Summary
The State of New York's decision to regulate direct to consumer (DTC) companies that provide genetic testing services is yet another example of increased in regulatory genetic test oversight. NY State regulations stipulate that these labs must obtain a permit from the State of NY and that the tests must be ordered by a NY State licensed physician. These regulations could limit the potential market for labs offering genetic testing on a DTC basis.
Analysis
Over 7 billion lab tests are performed in the US each year. Total 2007 revenues exceeded $52 billion. The esoteric segment is the fastest growing segment driven by breakthroughs in genomics/proteomics, personalized medicine and an aging population.
New State of New York regulations of companies offering genetic testing on a direct to consumer adds to a a growing list of public and private agencies. calling for regulatory genetic testing, laboratory developed tests (LDTs), and In Vitro Diagnostic Multivariant Assays (IVDMIAs).
These regulations could restrict the market potential for genetic testing firms such as 23andMe, deCode Genetics, Navigenics and many others.
There is also growing concern regarding LDTs from public and private groups. These include Genentech (NYSE:DNA), HHS's Secretary’s Advisory Committee on Genetic Testing (SACGT), the Genetics and Public Policy Center and others. LDTs have long offered clinical diagnostic test developers a quicker go-to-market path than the traditional FDA 510(k) approval route. There are obvious advantages to this strategy, along with associated risks.
For more information on the evolving regulation of the high growth, molecular diagnostics/genetic testing markets and companies, please contact your GLG representative and schedule an individual consult.
