SEATTLE - Adaptive Biotechnologies (NASDAQ:ADPT) Corporation (NASDAQ:ADPT) announced today that its clonoSEQ assay has received expanded coverage from Palmetto GBA, a Medicare Administrative Contractor, to include Medicare patients with mantle cell lymphoma (MCL). This decision allows for the detection and monitoring of measurable residual disease (MRD) in this patient population.
MCL, a subtype of non-Hodgkin lymphoma, accounts for roughly 4,000 new cases annually in the United States. It is known for its aggressive nature and the likelihood of patient relapse. The clonoSEQ MRD test, which can be performed on blood samples, offers a minimally invasive option to assess treatment response and monitor for potential relapse in MCL patients.
Dr. Anita Kumar from Memorial Sloan Kettering Cancer Center emphasized the importance of MRD testing in MCL for tailoring patient treatment and improving monitoring strategies. The expanded coverage is particularly significant as the majority of MCL patients are of Medicare age.
The updated Medicare coverage includes all lines of therapy for MCL patients and aligns with the existing Medicare episode payment structure, which has recently set the clonoSEQ test price at $8,029. This price adjustment follows the Clinical Laboratory Fee Schedule's annual payment determination process.
This new policy broadens the use of clonoSEQ, which is already covered by Medicare for MRD testing in multiple myeloma, chronic lymphocytic leukemia, and B-cell acute lymphoblastic leukemia, as well as circulating tumor DNA-based MRD testing in diffuse large B-cell lymphoma.
Ben Eckert, Senior Vice President of Market Access at Adaptive Biotechnologies, stated that the coverage expansion will facilitate the integration of clonoSEQ into lymphoma care pathways, potentially improving patient outcomes.
clonoSEQ is the only FDA-cleared in vitro diagnostic service for MRD detection in certain blood cancers. It is also approved by New York State's Clinical Laboratory Evaluation Program for clinical use in MCL. The test is performed at Adaptive's CLIA-certified lab in Seattle.
The information in this article is based on a press release statement from Adaptive Biotechnologies.
In other recent news, Adeptus Biotechnologies has reported notable developments. The company's key product, ClonoSEQ, has received In Vitro Diagnostic Regulation (IVDR) 2017/746 Class C certification in the European Union, marking it as the first and only minimal residual disease (MRD) test to meet the EU's stringent quality and safety standards. This certification broadens the use of ClonoSEQ for assessing MRD status and disease burden changes during and after treatment in patients with B-cell malignancies.
Financially, Adeptus Biotechnologies reported a 36% year-over-year increase in MRD revenue for the second quarter of 2024, totaling $43.2 million. Furthermore, the company has revised its full-year MRD revenue guidance upwards to between $140 million and $145 million.
Goldman Sachs (NYSE:GS) recently initiated coverage on Adeptus Biotechnologies with a Neutral rating, emphasizing the growth potential of ClonoSEQ. Concurrently, Piper Sandler confirmed its Overweight rating on Adeptus Biotechnologies, acknowledging the recent Medicare reimbursement update for ClonoSEQ as a positive development.
Despite these advancements, Adeptus Biotechnologies is exercising caution with the rollout of NovaSeq and has deprioritized the LIMS overhaul project. These recent developments reflect Adeptus Biotechnologies' continued focus on growth and operational efficiency.
InvestingPro Insights
Adaptive Biotechnologies' recent Medicare coverage expansion for its clonoSEQ assay aligns with the company's financial performance and market position. According to InvestingPro data, Adaptive's market capitalization stands at $847.97 million, reflecting its significant presence in the biotechnology sector.
Despite the positive news, it's important to note that Adaptive Biotechnologies is currently facing some financial challenges. An InvestingPro Tip indicates that the company is "quickly burning through cash," which could be a concern for investors considering the capital-intensive nature of biotechnology research and development.
However, the market seems to be responding positively to recent developments. Another InvestingPro Tip highlights a "significant return over the last week," with the stock price showing an impressive 18.8% total return in the past week. This surge could be attributed to the expanded Medicare coverage announcement and its potential impact on the company's revenue stream.
The company's revenue for the last twelve months as of Q2 2024 was $168.77 million, with a revenue growth of -10.99% over the same period. While this indicates a contraction, the expanded coverage for clonoSEQ could potentially help reverse this trend in the coming quarters.
It's worth noting that Adaptive Biotechnologies is trading near its 52-week high, with its current price at 99.14% of the 52-week peak. This suggests that investors are optimistic about the company's prospects, possibly due to developments like the expanded Medicare coverage for clonoSEQ.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for Adaptive Biotechnologies, providing a deeper understanding of the company's financial health and market position.
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