Who Can Challenge Myriad's Monopoly In Breast Cancer Gene Tests?

Original post on Forbes.com by Mathhew Herper, 10/15/13

Four months after a Supreme Court decision that invalidated some patents on Myriad Genetics’ tests for breast and ovarian cancer risk, the Salt Lake City biotechnology firm is facing a new, and very big, competitor: Quest Diagnostics, the $7 billion (sales) maker of laboratory tests.

Quest will offer the most comprehensive version of the tests, which look at variation in the DNA in the BRCA1 and BRCA2 genes, for $2,500, about 40% less than Myriad charges. Simpler tests, which can look for particular spelling variation because of a patient’s family history or ethnicity, will cost $500.

“We’re certainly starting to see the classic race to the bottom I’ll be astonished if the price isn’t under $500 for the whole thing pretty soon,” says George Sledge, Chief of the Division of Oncology at Stanford University. “The actual analysis if you’re not using 1995 technology the prices should be super-cheap because the price of sequencing is following a super-Moore’s law track. It doesn’t make much sense from a technology standpoint that it should be this expensive.”

Not everyone agrees that a race to the bottom is in the works. Myriad has several advantages over other players: it has other patents that were not touched by the Supreme Court decision; it controls a proprietary database of which variants in the BRCA1 and BRCA2 genes increase the risk of breast and ovarian cancer, and by how much; and it has developed a good reputation among cancer doctors and gynecologists, who have no reason to switch to a new test just because it is cheaper so long as insurers pay for the old one. Myriad has reason to fight, because it gets much of its $613 million in annual sales from sales of the BRCA tests.

The first two challengers, Ambry Genetics and Gene-By-Gene, are already embroiled in a legal battle with Myriad. And Myriad isn’t showing any signs of backing down for Quest. When Quest sued it ahead of its product launch, a Myriad spokesman told GenomeWeb that it would be “premature to comment” but that the patents around the tests are “valid and enforceable.”

Sue Friedman, the executive director of Facing Our Risk of Cancer, a patient group that advocates for people with hereditary cancer risk, says she still hopes Quest’s entry is a move toward healthy competition. “We’re hoping that having another laboratory that has a reputation for high quality lab tasting to offer testing to patients will drive the cost down,” she says.

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