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After IPO, Exagen Seeks to Make Further Strides in Autoimmune Diagnostics

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NEW YORK – Two months after going public, Exagen has big plans for its future in the autoimmune diagnostic arena.

With nine tests currently on the market and several more in the pipeline, the company is using its proprietary cell-bound complement activation products (CB-CAPS) technology to expand its offerings and provide more options for patients with autoimmune disorders, a market that Exagen CEO Ron Rocca estimated at $5 billion annually. 

The CB-CAPS technology, which leverages flow cytometry, has benefits beyond traditional methods that measure serum proteins complement component 3 (C3) and complement component 4 (C4), said Rocca. Since activation of the complement system is a key part of systemic lupus erythematosus (SLE) progression, low levels of C3 and C4 can indicate lupus. However, variability in C3 and C4 levels can be caused by other factors not related to lupus, making them less reliable. 

Exagen has the rights to two biomarkers that are the fragments that cleave off C3 and C4 and then covalently bond to cells, called erythrocyte-bound C4d (EC4d) and B-cell lymphocyte-bound C4d (BC4d), and which are considered more reliable for lupus diagnosis than C3 and C4. Exagen exclusively licenses the CB-CAPS technology from the University of Pittsburgh. 

Its flagship test and main moneymaker, the Avise CTD, was launched in 2012 and is a two-tier lupus assessment test that includes the Avise Lupus, a proprietary 10-marker test, plus 12 associated autoantibody markers. Exagen has not yet received 510(k) clearance for the test, and the company markets it as a laboratory-developed test.  

For the third quarter, during which the Vista, California-based firm went public, it reported a 29 percent increase in Avise CTD volume to 27,159 tests, which drove total revenue growth of 27 percent. 

Two recently released studies have validated the clinical utility of the test. One, published in Lupus Science & Medicine in September, found a statistically significant difference in the physician-reported likelihood of SLE when using the Avise Lupus test compared to standard diagnostic laboratory testing.

The other, published in Arthritis & Rheumatology in August, found that complement activation can be detected with higher frequency by CP-CAPS and a multianalyte assay panel than traditional serum complement protein levels. 

Rocca said the company plans to use the studies as evidence to support insurance coverage for its Avise CTD test. According to it prospectus filed with the US Securities and Exchange Commission ahead of its IPO, Exagen has no contract with any "significantly large private payors," but Rocca noted that Exagen has completed its analysis of data and other information — including clinical and analytical validity, clinical utility, and healthcare economics for the Avise product — that it will submit to payors as part of their discussions around reimbursement, which are expected to begin in 2020, Rocca said.  

The company's other diagnostic test is the Avise APS, a specialized test to aid in the diagnosis and management of antiphospholipid syndrome. The firm is reimbursed for the test based on pre-existing reimbursement codes, and Rocca said there's no short-term plan to change the company's approach to reimbursement for the test. 

Additionally, Exagen offers test for the prognosis and monitoring of patients with lupus, along with tests for other autoimmune disorders. The Avise SLE Prognostic is a supplementary test panel to help assess risk for organ involvement and thrombotic events, and the Avise SLE Monitor helps clinicians assess the patient's disease progression.  The Avise PC4d measures a biomarker shown to have significant association with thrombosis and ischemic stroke in SLE patients. 

In the rheumatoid arthritis sphere, the company has its Avise Anti-CarP to measure anti-carbamylated protein antibody to help identify RA patients with an increased risk for joint damage, and its drug monitoring test Avise MTX, which optimizes methotrexate therapy for RA patients. In addition, the Avise HCQ measures hydroxychloroquine levels in whole blood. 

Further along in the pipeline, Rocca said the company owns the rights to all the fragments that cleave off proteins C3 and C4, but only currently monetizes three. He declined to elaborate on specific plans but noted that the company is looking into the other fragments to continue developing the CB-CAPS portfolio, including fragments that bond to T-cells.  

The company also has a fibromyalgia product it's looking to launch in the second half of 2021, another Avise product for thrombosis with a launch date in the first half of 2021, and a project to use the complement system to determine transplant organ rejection, which is currently in the pilot phase with an expected launch in 2023. 

These areas were chosen, Rocca said, because they will either serve a large relative population or address situations where severe negative outcomes need to be avoided. 

Although there are large general reference labs as competitors, Rocca said there are no competitors doing specifically what Exagen does, since larger labs are focused on traditional testing in a high-volume setting, rather than specific testing in a dedicated lab. 

Exagen's IPO, which raised $58 million, will allow it to continue the expansion into other autoimmune disorder spheres, Rocca said. "With the additional capital, we can continue to look at other potential markers that are out there that are underutilized that can be developed further," he said. 

The success of Avise's commercialization was a driver on the company's decision to go public, Rocca said, as was the need for access to more capital to drive market penetration and integrate the promotion of testing products and therapeutics. Going public was a component of the company's full strategic plan, which also includes doubling the sales force and growing its R&D pipeline, Rocca said. 

Late last week, the company announced it has extended an existing collaboration with GlaxoSmithKline. Exagen did not provide details of the deal, saying only in a statement that it was aimed at raising awareness of the importance of a timely diagnosis of SLE, and "at the center of the program are the proprietary Avise laboratory tests." It and GSK originally inked their deal last year and they "will continue to support the shared goal of helping SLE patients shorten the time to their diagnosis." 

As the company moves forward, it expects to stay firmly in the autoimmune space. "We have this own-the-hilltop strategy," Rocca said. Autoimmune is "the area we feel we could contribute the most value to society, patients, and the doctors."