Interpace Biosciences CEO Jack Stover On Diagnostics Business: 'Much Of The Growth Opportunity Is Around Awareness'

Interpace Biosciences IDXG provides complex molecular analysis for the early diagnosis and treatment of cancer. The company also supports the development of targeted therapeutics. Benzinga interviewed Jack Stover, Interpace's president and CEO, about the business. 

Benzinga: One of Interpace's business partnerships is with Genecast Biotechnology in China. Can you give some insight into this partnership?

Stover: Genecast is associated with our biopharma business. They also provide clinical trial services to Chinese companies looking for drug approval. Interpace will be bringing to them U.S. pharmaceutical companies that need a Chinese clinical component for their trials, while Genecast will be bringing to us Chinese companies that need a U.S. clinical component to their trials.

So this is a first step for us in international expansion, along with a few others in Western Europe.

Benzinga: What is Interpace's approach to expand in the molecular testing sector?

Stover: Our core business is broken into two pieces, both around a molecular diagnostic environment.

The diagnostic business (classic) is focused on molecular diagnostics, which are around specific therapeutic areas — primarily gastrointestinal and thyroid. This provides a molecular analysis to biopsies in those spaces.

In addition, the new acquisition of the biopharma business of Cancer Genetics CGIX is focused around molecular diagnostics and providing information. The information is not provided to patients and hospitals, but to pharmaceutical companies that are looking to develop a new drug. This has expanded the opportunity for pharmaceutical companies to pick the right drug and get it approved by the FDA in a shorter period of time.

In terms of size, Interpace has nearly doubled in size since the acquisition. But much of the growth opportunity is around awareness.

Benzinga: How do biopsies help patients with pancreatic cancer, and how do they help physicians?

Stover: Interpace primarily receives biopsy results in thyroid and pancreatic cancer. But if a biopsy is malignant, then it's not an area that we can help. If the biopsy is benign, then they don’t need our help.

When a biopsy is indeterminate, that’s when we can help, because in most cases it's in a form of a cyst. With the evaluation process, we are able to help the physician. We provide them with the information to determine if a surgery is needed or not. We are also able to identify the potential for the cyst to migrate to an aggressive form of cancer.

Benzinga: How difficult is it to get paid by the insurance companies?

Stover: It depends, but generally speaking it's hard to do. The issue is around medical necessity. The insurance companies don’t use the same data or same information. If a patient wants to try a new drug or treatment which has been successful in the past, the insurance companies might say it hasn't been successful enough.

To put it in perspective, 40% of the tests we issue are not paid for by insurance companies.

Benzinga: The thyroid and pancreatic products have seen a substantial growth in recent years. How do you attribute the growth? 

Stover: As the awareness improves, then the expansion and utilization by doctors improves as well. In regards to pancreatic cancer: the regulatory barriers have been lessened. This allows the opportunity to use our tests on a more regular basis. These barriers have been dropped across the country.

In addition, all of our tests are covered by Medicare, which is really important because the majority of pancreatic cancer is in older patients who are more likely to be on Medicare.