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Natera Expands Into Transplantation Market, Focusing on Rejection Detection

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SAN FRANCISCO (GenomeWeb) – Natera outlined its plans for entering the transplantation market this week, which include launching a clinical test in 2019 to detect acute rejection in kidney transplantation.

During a conference call with investors, Natera CEO Matt Rabinowitz discussed the firm's entrance into the transplantation market and highlighted progress it has made in the breast cancer market.

The call followed an announcement last week in which Natera said that it had harnessed its cell-free DNA technology to identify markers of kidney transplant rejection. At next week's Transplantation Society International Congress in Madrid, Spain, the company plans to present data from a retrospective study it conducted with researchers at the University of California, San Francisco. Natera originally struck a collaboration with UCSF in 2016 to harness its technology to identify cell-free DNA markers for kidney transplant rejection, but has been quiet about its progress in this area until now.

For the study, Natera and UCSF researchers analyzed 300 plasma samples from 193 kidney transplant patients, 52 of whom experienced acute rejection. Looking at cell-free donor-derived DNA, the researchers were able to identify 48 out of the 52 acute rejection cases.

During the call, Steve Chapman, Natera's chief operating officer, noted that the total transplantation market is estimated to be around $2 billion in size. For Natera's first entry into that space, Chapman said, the firm could launch a test with limited investment in sales and marketing. Unlike the market for noninvasive prenatal testing, which is decentralized among many Ob-Gyns, around 80 percent of kidney transplant patients are treated at just 100 centers in the US, Chapman said. "We could target this market with a modest sales team," he said, and leverage existing infrastructure the firm has already put in place, such as automatic blood draws.

Natera is also looking into partnering with another company that already has a sales effort at transplantation centers for the commercialization of a kidney transplant rejection monitoring test, a partner Chapman said.

To reach international customers, Natera would leverage its Constellation infrastructure, whereby external labs license the technology and run the test in house.

Chapman said that the firm aims to pursue reimbursement for the test. It anticipates that the Centers for Medicare and Medicaid Services may crosswalk the assay to another cell-free DNA test, marketed by CareDx, which is priced at $2,800.

Following last week's announcement, Mark Massaro, an analyst with Canaccord Genuity, wrote in a note to investors that although Natera's move into the transplantation market came "out of left field," it "shows the versatility of its technology platform." In addition, while Natera's initial data concerns kidney transplantation, "over time we think it could be expanded to other organs like heart, lung, and liver," constituting a total addressable market of more than $2 billion, he wrote.

Massaro also noted that although Natera's initial data was promising and even appeared favorable compared to CareDx's published data, Natera's study was retrospective and included samples from just one center, while CareDx ran a multi-site prospective study.

William Quirk, a senior research analyst with Piper Jaffray, wrote in a note to investors last week that although "Natera is a credible threat to CareDx," the firm would likely face reimbursement challenges, which could inhibit adoption, and would likely face a patent lawsuit from CareDx.

Indeed, during the call this week, investors questioned Natera's ability to crosswalk its assay to CareDx's test, noting that CareDx secured its $2,800 price in part due to its participation in a registry study of outcomes. Quirk said in a note after the call that Natera "would likely have to agree to a similar protocol," a process that could take around two years.

Natera also provided an update on its circulating tumor DNA assay, Signatera, during the call. Solomon Moshkevich, the firm's senior vice president of products and strategy, said that based on recent data for the assay in three breast cancer studies, Naetera has identified two promising applications that it plans to pursue.

One study, with collaborators at the University of Leicester and Imperial College London, tested Signatera in a cohort of 49 breast cancer patients who were at least three years post treatment. Without going into details, Moshkevich said the study showed that one application of Signatera could be to help physicians make treatment decisions for HER2 positive patients. Patients who are HER2 positive and have finished at least one year of trastuzumab (Herceptin) therapy are eligible for the tyrosine kinase inhibitor neratinib, which was approved last year. The drug is intended to prevent recurrence, but "side effects are significant," Moshkevich said, making it most appropriate for patients at an increased risk of relapse. Signatera may be able to help physicians determine which patients are at increased risk, he said.

A second indication for the test in breast cancer might be recurrence monitoring. Currently, after treatment, most patients are monitored via mammography and clinical examination. However, over 70 percent of relapses are distant, so not picked up by mammography, Moshkevich said. Being able to monitor with Signatera has the potential to improve outcomes, he said, because it could catch relapse sooner and enable treatment right away.

Rabinowitz said that Natera plans to pursue several commercialization strategies for Signatera. For indications that fall within current guidelines, such as determining which breast cancer patients should receive neratinib, Natera will pursue a local coverage determination. For more complex indications that will require larger studies to demonstrate clinical utility, the firm plans to work with pharmaceutical companies or academic groups that have access to large cohorts of patients to conduct those studies, after which it would pursue a parallel review from the US Food and Drug Administration and CMS.