DTC Genomics adjusts for regulations. 23andCGC?

In a blatantly obvious, why the hell werent they doing that in the first place? move.


23andSerge acknolwedges, finally, that they ARE Providing clinically important work. Duh,

Since the website won't let me copy the presser, I will quote, with my own translation through business BS speak.

"23andMe customers now have the option to speak with a board certified genetic counselor"

-Translation, we realized that by testing BRCA mutations we put people at risk and needed some back up from someone who knows what the FCUK they are doing opposed to a VC billionaire babe and ruby on rails programmer kids.

-Because, frankly, we don't want to get sued or go to jail......Like Liz Dragon......

"We chose Informed because they were the leading independent genetic counseling provider"


-Translation, we alienated/pissed off the entire rest of the FCUKING community by saying they were stupid. Thus these were the only guys who would work with a company getting ready to be pilloried by Congress

IMHO, Informed are a great service, we are modeling genetichub after them, but... No one else would work with them on this. NO ONE, or so I am told......

"We wanted to be sure that the information our customers receive would be completely objective"

-Translation: We didn't want to have egg on our face when the geneticists said, "Well Andre, that finding essentially means nothing to your long term health and happiness"

"Customers who want a more thorough review of their family and medical histories can chose the Comprehensive Clinical Genetic Counseling"


-Translation: Yes we know we have been pushing this "It's not clinical" thing, but let's face it, no one is buying it. So we said Clinical, yes we did. See Henry, we are trying Congressman. See. Please no pre-market review.

The Sherpa Says: Well 23andMe, I am proud you came around. Too bad it only took an FDA review and being called to testify before congress before you "acted" in the best interests of your customers. 3 years later and I can say it. I told you so......

Holy Crap! MedCo Follows in CVS footsteps

By December 21st the writing was on the wall. It was pretty obvious CVS/Caremark had jumped over the number one PBM in the field MedCo.....

How so?

Well, the increased ownership in Generation Health that CVS/Caremark laid down was the way.....

The newest of the benefits management companies.....this time the focus was on genetic testing benefits.

Personally, this type of company should have been formed in 2005 when Insurers were hemorrhaging cash from those BRCA tests........

But, slow and deliberate do Insurers move....

On the 21st it of December it was all but decided for MedCo. Ummm, Ummmmm, who looks like this Generation Health company?????

I knew back then and now everyone knows today.

MedCo buys DNADirect.....

In 2005 when My Partner at the time Leslie Manace went out to "see" Ryan...... In what turned to be a huge probe of Leslie by Ryan, Ryan revealed......"We are interested in PGx" Which was funny because so were we. So much so that we really thought that this was the bees knees and in fact was likely the only useful and scalable testing to come out in the next 5 years.

The DTC Genomics companies were merely a twisted dream at the time.

Well, Ryan. Our hunch paid off.

By Diversifying your DTC genetic testing company into something useful such as a GBM, you have moved shrewdly. And when the PBM leader gets trumped by CVS, you reap the rewards.

I look forward to the first quarter report from MedCo to see exactly how much they acquired you for.

I have been saying on this blog that the answer for these DTC genomics companies is to follow your lead. Now the question is, which big insurer will now but a DTC genomics company?

For MedCo, I am a little disappointed that you decided to choose the exact type of company as Caremark did. There are lots of other solutions out there. I hope you still plan on increasing your footprint in this space. Because it would be bad if CVS/Caremark continues to gobble these companies up and you end up buying the second in class.....

Not that DNADirect is second in class, but Heather Shappell et.al. ARE First Class.......

The Sherpa Says: There has got to be a way to make these companies less reliant on people. Even in the genetics testing space, there is a way to automate.

Congratulations Generation Health. Nice pick up!

Is it any surprise that insurance companies have no clue what the hell is going on with genetic testing?



You see, there are a set of ICD9 codes that can mean 2C19 testing or hepatitis pcr........



The coding system doesn't allow the companies to run their algorithms accurately......



Insurers have no clue which is which and they are getting banged out for these tests.



Don't believe me, just take a look at what United has done with their BRCA testing (which BTW has their own codes)



"By instituting a prior notification policy and placing Myriad in charge of determining which patients get tested, United Healthcare can monitor more closely which of its policy holders are receiving testing on BRACAnalysis."



Add in the SGO guidelines which suggest a 5% BRCA carrier risk may be worthwhile and you can see why the companies are looking to stop the carnage or testing overuse.



Myriad on the other hand would beg to differ. They see years of under utilization as something to combat. And they are very successful at it, just check out MYGN.



The answer is somewhere in the middle. What is a responsible insurance company to do?



Answer: Generation Health.



What happens when genetic testing costs less than 100 bucks? Well, then maybe Generation Health will need to speak with me regarding a diversification company we are working on.....



With other PBM companies actively looking at new automated strategies for GBM (not glioblastoma multiforme) Generation Health is an interesting play.



I remember speaking with a certain player who also was involved with the DTC companies, who agreed with me. DTC is a bull$h!t play, benefits management of real testing, hyperlipids, HCM, etc are where the puck will be......From the Genome Web article (HT Turna Ray)



"The partnership will also “allow the companies to explore future programs in the medical diagnostics arena to encourage appropriate and cost-effective testing for certain hereditary diseases, and eliminate unnecessary testing where evidence for clinical validity and utility is lacking,” the collaboration partners said in a statement. "



We talked about this for some time (unnamed MD and myself) and then.....radio silence.......Only to show up with funding and some small hits.



They chose genetic counselors instead of my band of geneticists......



These guys are moving in the right direction. The industry is shaping up and guess what the killer app for genetic testing is?????



That's right, actual, honest, regulated medical testing........ Go figure.



Now, who gets what, how is it paid for, how is it used?



These are the questions that will need to be solved.



Until of course the accuracy and cost of a genome is less than 500 USD Which could be quite a while.



Meaning, Generation Health has about 10 years of life as the company it is right now. Not bad.



Imagine saving insurers millions per year, then taking 10-20% of those savings......... per year CVS/Caremark is a great partner and now owner/investor.........A very strategic investment.



My guess is that the DTC companies will fall in line or perish. Then labs will have to start marketing better, offer faster turnaround times and there will be "preferred" lab status.....per insurer.



Basically creating a super confusing land mine for physicians and patients. Just like radiology, just like surgery, just like chemo, just like......medicines



The Sherpa Says: Finally, corporations and investors are figuring out what IS important. Staying alive and having your medications work!!