Dunedin-based biotechnology company Pacific Edge's bladder cancer test is now available to about one-quarter of the North American population following the signing of a new deal.
By the end of the year, it seems possible the Cxbladder test will be available to half of the North American population, as two more deals are being negotiated.
Chief executive David Darling announced yesterday Pacific Edge had entered into a new agreement with MultiPlan for diagnostics laboratory testing.
The agreement included Pacific Edge's participation in the MultiPlan, PHCS and PHCS Savility Networks.
The agreement was the fourth signed with national provider networks by Pacific Edge since October last year and was another step in the company's commercial rollout of Cxbladder in the United States, the world's largest healthcare market, he said.
The agreement with MultiPlan, in addition to the agreements with FedMed, America's Choice Provider Network and Stratose, made Cxbladder available to a large proportion of US residents.
''National and regional provider networks are a key component in the commercial fabric, ensuring health care providers and technology suppliers are paid by healthcare for treatment provided to patients.
''Our participation in these networks will give a large number of Americans access to Cxbladder and its positive benefits as a quick, cost effective, non-invasive and highly accurate cancer detection test that is particularly appealing to US healthcare professionals, patients and insurers,'' Dr Darling said.
Craigs Investment Partners broker Chris Timms said the challenge for Pacific Edge was to turn the positive market announcements into positive cash flow.
The company had previously set a target of $100 million of sales.
The shares had been drifting recently as, like some investors in Xero, shareholders had become ''momentum driven''.
Once the flow of news stopped, people with little understanding of what the company was doing sold out of the stock, he said.
Also, some key stakeholders had sold some of their shares.
''People put two and two together, got eight, and followed others out of the company.''
Other investors believed in what the company was doing and had waited a long time for the results, Mr Timms said.
The latest contract added to the credibility of Pacific Edge in the market.
''Biotechnology companies have a long gestation period. People have to be patient.''
The incremental cost of distributing the Cxbladder tests widely must be outweighed by the benefits.
''If the processes are in place, it won't make much of a difference how many tests are shipped. It is like a hopper.
"When you keep tipping things in the top, it doesn't mean an increase of costs at the bottom. Any increase in sales should go straight to the bottom line,'' Mr Timms said.
Pacific Edge is set to report its latest financial results on Thursday.
Dr Darling said Pacific Edge's agreement with MultiPlan would give MultiPlan's participating providers and its client members access to Cxbladder.
About 900,000 providers participated in MultiPlan's provider networks and an estimated 68 million consumers had access to one or more of those networks.
Pacific Edge Diagnostics US chief executive Jackie Walker said her sales and marketing teams were focused on the urologists and clinicians treating the largest number of bladder cancer patients to ensure they fully understood the value and benefits Cxbladder provided to them and their patients.
''We are advancing relationships with large commercial payers and the Centre for Medicare and Medicaid Services which provided healthcare insurance for 100 million people - or nearly a third of the American population.''
Progress was being made with key customer segments, including integrated Healthcare Systems, the Veterans Administration and Large Urology Groups, which were the point of contact for many patients presenting with haematuria - blood in the urine - an early indicator of possible bladder cancer, she said.
More than one million Americans a year undergo medical investigation for potential bladder cancer at an estimated cost of more than $US1 billion ($NZ1.17 billion).
Bladder cancer is one of the most expensive cancers to treat.
The very high recurrence rate of this disease, requiring some patients to receive expensive monitoring for the rest of their lives, causes bladder cancer to have the highest total medical costs of any cancer from detection to death.
In the US, the total medical cost approaches $US220,000 per patient.
Cxbladder
Cxbladder is a proprietary, accurate molecular diagnostic test enabling the non-invasive detection of bladder and other urinary tract cancers from a small volume of urine. Cxbladder is commercialised in the United States as a Laboratory Developed Test (LDT). It provides physicians and clinicians with a quick, cost-effective and accurate measure of the presence of the cancer and provides urologists with the opportunity to reduce their reliance on the need for invasive tests such as cystoscopy.
