This story has been updated with additional details from UnitedHealthcare's coverage policy.
NEW YORK – UnitedHealthcare has issued a positive coverage decision for Myriad Genetics' GeneSight Psychotropic pharmacogenetic test, Myriad disclosed in a filing with the US Securities and Exchange Commission today.
The GeneSight test gauges variants associated with drug response and uses a color coding system to provide information about which drugs patients are likely to respond to best based on their genetic makeup. In a coverage policy slated to take effect on Oct. 1, UHC said that pharmacogenetic multi-gene panels are medically necessary for guiding use of antidepressants and antipsychotic drugs for patients with major depressive disorder or anxiety, who have failed to respond to one or more treatments, and the multi-gene pane has no more than 15 relevant genes.
The insurer deems all other indications for pharmacogenetic multi-gene panels, for example in guiding pain management therapy, cardiovascular treatments, anthracyclines, or polypharmacy, to be unproven and not medically necessary.
UHC decided to cover panel testing to help guide psychotropic drug use based on the findings of the GUIDED study, Piper Jaffray analyst William Quirk wrote in a note to investors. While Myriad had hoped that this study would bolster reimbursement prospects for GeneSight, some market observers had been more cautious since that study failed to meet its primary endpoint, though it showed that patients receiving GeneSight-guided treatment had significant improvements in remission and response rates.Â
Quirk estimated that UHC's decision extends coverage for approximately 34.5 million lives, and if fully reimbursed at $2,000 per test starting Oct. 1, current test volumes may be worth more than $4.00 per share in earnings power. "We view the positive decision from UnitedHealthcare as a potential inflection point for private payor coverage," he wrote, adding that several large insurers, including Aetna, Anthem, and Independence BCBS have referenced the GUIDED study but have yet to issue coverage.Â
In morning trading on Nasdaq, Myriad's stock price was up more than 40 percent to $40.92.