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Veracyte Achieves Major Medicare Milestone for the Envisia Genomic Classifier

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First Test for Improved IPF Diagnosis Receives Draft Local Coverage
Determination Through the MolDx Program

Veracyte,
Inc.
(NASDAQ:VCYT) announced that it has received a draft Medicare
local coverage determination (LCD) for the Envisia Genomic Classifier
through the MolDx program. WPS Health Solutions posted a draft
policy
 today, and the three other MACs (CGS, Noridian Health
Solutions and Palmetto GBA) that participate in the Palmetto
GBA-administered MolDx program are expected to issue similar LCDs. The
Envisia classifier, which is built on next-generation RNA sequencing and
machine learning technology, is the first test to achieve this
significant Medicare coverage milestone for use in diagnosing idiopathic
pulmonary fibrosis (IPF). Upon anticipated finalization, Envisia will
become Veracyte's third genomic test to gain Medicare coverage since the
company's founding in 2008.

Veracyte estimates that each year in the United States and Europe, up to
200,000 patients are evaluated for suspected interstitial lung diseases
(ILD), including IPF, which is among the most common, deadly and
difficult to diagnose of these lung-scarring diseases. Veracyte
estimates that half of the patients evaluated in the United States are
covered by Medicare.

"We applaud the MolDx program for taking this important step to make the
Envisia classifier widely available to Medicare patients," said Bonnie
Anderson, Veracyte's chairman and chief executive officer. "The evidence
supporting use of the Envisia classifier met MolDx's high bar for
coverage and strongly positions us to expand commercialization of the
test in 2019."

The draft policy is open to a 45-day comment period and Veracyte
anticipates that the final policy will go into effect in early 2019.
Veracyte's tests for improved diagnosis of thyroid cancer (Afirma) and
lung cancer (Percepta) received Medicare coverage in 2012 and 2016,
respectively.

"Timely, accurate diagnosis of IPF is essential so that patients can
receive optimal treatment, including new therapies that can slow
progression of this deadly disease," said Fernando J. Martinez, M.D.,
chief of the Division of Pulmonary and Critical Care Medicine at Weill
Cornell Medicine, who is also a scientific advisor for Veracyte (the
Envisia test maker). "Alas, IPF remains difficult to diagnose, with a
challenge in distinguishing it from other interstitial lung diseases
that can lead to diagnostic delay and, potentially, inappropriate
therapy."

The Envisia Genomic Classifier helps differentiate IPF from other ILDs
without the need for surgery. The test is used as a complement to
high-resolution computed tomography (HRCT) to enable clinicians to make
a more confident diagnosis. Envisia evaluates patient samples that are
obtained through transbronchial biopsy, a nonsurgical procedure that is
commonly used in lung evaluation. The 190-gene test detects a genomic
pattern of usual interstitial pneumonia (UIP), a hallmark of IPF, with
high accuracy (88 percent specificity and 70 percent sensitivity).

In May 2018, Veracyte launched an Early Access Program to begin making
the Envisia Genomic Classifier available to patients through select
institutions around the country. The company estimates that the market
opportunity for the Envisia classifier in the United States and Europe
is approximately $525 million.

About Interstitial Lung Disease

Each year in the United States and Europe, up to 200,000 patients are
evaluated for suspected ILD, including IPF, which is among the most
common, deadly and difficult to diagnose of these lung-scarring
diseases. Physicians routinely use HRCT along with a clinical work-up to
help identify IPF, but this approach frequently provides inconclusive
results, leading many patients to undergo invasive and potentially risky
surgery for a more definitive diagnosis. Other patients are too frail to
undergo surgery and may never receive an accurate diagnosis, which can
result in suboptimal - and potentially harmful - treatment.

About Veracyte

Veracyte (NASDAQ:VCYT) is a leading genomic diagnostics company that
improves patient care by providing trustworthy and actionable answers to
challenging clinical questions. The company's products uniquely combine
advanced genomic technology, clinical science and machine learning to
provide answers that give physicians and patients a clear path forward,
informing both diagnosis and treatment decisions without the need for
costly, risky surgeries that are often unnecessary. Since its founding
in 2008, Veracyte has commercialized three genomic tests, which are
transforming the diagnosis of thyroid cancer, lung cancer and idiopathic
pulmonary fibrosis and collectively target a $2 billion market
opportunity. Veracyte is based in South San Francisco, California. For
more information, please visit www.veracyte.com
and follow the company on Twitter (@veracyte).

Cautionary Note Regarding Forward-Looking Statements

This press release contains "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements can be identified by words such as:
"anticipate," "intend," "plan," "expect," "believe," "should," "may,"
"will" and similar references to future periods. Examples of
forward-looking statements include, among others, our belief that our
genomic tests will transform the diagnosis of thyroid cancer, lung
cancer and idiopathic pulmonary fibrosis; statements regarding the
anticipated offerings under the launch of our Early Access Program; and
statements regarding the ability of the Envisia Genomic Classifier to
improve IPF diagnosis. Forward-looking statements are neither historical
facts nor assurances of future performance. Instead, they are based only
on our current beliefs, expectations and assumptions regarding the
future of our business, future plans and strategies, anticipated events
and trends, the economy and other future conditions. Forward-looking
statements involve risks and uncertainties, which could cause actual
results to differ materially, and reported results should not be
considered as an indication of future performance. These risks and
uncertainties include, but are not limited to: our ability to achieve
Medicare coverage for our tests, the market opportunity for the Envisia
classifier, the benefits of our tests, the applicability of clinical
results to actual outcomes; the laws and regulations applicable to our
business, including potential regulation by the Food and Drug
Administration or other regulatory bodies; our ability to sell our
Afirma tests and successfully transition to our next-generation Afirma
GSC; our ability to successfully achieve and maintain adoption of and
reimbursement for our products; the amount by which use of our products
are able to reduce invasive procedures and misdiagnosis, and reduce
healthcare costs; the occurrence and outcomes of clinical studies; and
other risks set forth in our filings with the Securities and Exchange
Commission, including the risks set forth in our quarterly report on
Form 10-Q for the quarter ended June 30, 2018. These forward-looking
statements speak only as of the date hereof and Veracyte specifically
disclaims any obligation to update these forward-looking statements or
reasons why actual results might differ, whether as a result of new
information, future events or otherwise, except as required by law.

Veracyte, Afirma, Percepta, Envisia, the Veracyte logo, and the Afirma
logo are trademarks of Veracyte, Inc.

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