By Paul Goldberg
Caris Life Sciences Inc. last week reduced its workforce by 50 people—about 20 percent, sources said.
While a 50-person reduction in force is small by pharma industry standards, the development could be significant because Caris is a key player in the emerging market for molecular therapies.
Company officials characterized the layoff as an effort to manage personnel expenses.
“The company’s revenue and case volume has grown by over 50 percent so far this year,” Caris officials said in a statement to The Cancer Letter. “Evaluating and maintaining the appropriate staffing levels is a constant effort for the company as we keep our offering on the cutting-edge. Of course, we will continue to monitor this to ensure that we provide the highest quality and most advanced molecular profiling service available, which our customers have come to expect and which their cancer patients deserve.”
The privately held company markets the Caris Molecular Intelligence assays, which are widely used by oncologists, primarily outside of academic medicine.
Caris is not involved in the NCI trials of molecularly guided therapies.
The layoff affected the evidence review, IT, and quality assurance staff as well as administrative and facilities employees, sources close to the situation said to The Cancer Letter. The company’s lab staff and the sales force have been left largely unaffected.
As is always the case when pharma and biotech companies reduce staff, bitter anonymous comments appeared on the CafePharma website.
Caris assays use IHC, FISH/CISH, PCR, and next-generation sequencing. In the past, Caris declined to disclose the prices of its services (The Cancer Letter, Aug. 8).
On its website, Caris says that its assays were used in making treatment decisions for as many as 60,000 people in 59 countries since 2006.
“[Caris Molecular Intelligence] can provide up to 51 potentially relevant FDA-approved drug associations,” David Halbert, Caris’s top executive, wrote in a recent letter to the Boston Business Journal, claiming that it’s “the only profiling service offering a comprehensive analysis of all relevant drug associations currently supported by strong medical evidence.
“By comparison, [the Foundation Medicine Inc.] test can make no more than 19 drug associations,” he wrote.
The reference to “potentially relevant FDA-approved drug associations” may be confusing even to insiders. The agency approves drugs, not associations between targets and biomarkers. In some cases, FDA approves drugs and biomarker assays known as companion diagnostics, where the testing and treatment based on this testing shows a favorable outcome.
In a recent interview with The Cancer Letter, Daniel Hayes, a breast cancer expert at the University of Michigan, said Caris may have “over-interpreted the test they provide that might suggest that a drug won’t work” (The Cancer Letter, Aug. 8).
Hayes and other experts say that they fear that in some cases the findings on such tests may prompt doctors to rely less on evidence-based guidelines and instead base treatment decisions on findings of molecular tests and interpretations that are far from definitive.
“On their website they say they’ve done 60,000 cases,” Hayes, the university’s Stuart B. Padnos Professor of Breast Cancer Research and a member of a recent Institute of Medicine committee that issued a report on omics, said in his recent interview with The Cancer Letter. “That’s a lot of patients, and I am not sure they were treated properly, based on results that I am not sure we can trust.”
There is no question that big changes are brewing in the market for molecular tests.
• FDA is phasing in regulation of so-called “laboratory-developed tests,” a category that includes the Caris product, starting with assays that may lead patients to select one treatment option over others (The Cancer Letter, Aug. 1).
• Tests that provide genomic information lie at the foundation of the new generation of NCI-sponsored trials (The Cancer Letter, June 20).
• Pharma companies, as they develop drugs intended to target specific markers, have been pressing FDA to regulate laboratory-developed tests. As it stands, the many assays currently utilized in clinical practice don’t have to demonstrate safety and efficacy and are largely billed in such a way that Medicare and private insurers cannot identify what is being tested and why.
• Payment policy for tests is also in flux. Medicare and private insurers have no way to distinguish the majority of genomic tests from each other and no way to decide whether these tests are medically necessary, insiders say.
A few tests—for example, Oncotype DX—have specific codes, but the majority are lumped together in two classifications: “Tier 2 Molecular Pathology Procedures” (CPT codes 81400-81479) and “Multi-Analyte Assays with Algorithmic Analysis” (CPT codes 81500-81599).
The codes tell payers what the laboratory did, without saying what the test is for. Medicare is trying to unblind this process through a program called MolDX.
Caris is also facing a lawsuit filed by two former employees, who allege that their former employer violated the federal anti-kickback statute by routinely waiving some of its fees to induce referrals to federal healthcare programs.
The suit, filed in the U.S. District Court for the Northern District of Texas, Dallas Division, also alleges that over one very hot summer, Caris ran tests on hematology specimens that were compromised by heat. If this is correct, the results of these tests would have been uninformative and treatment choices based on such findings questionable.
Caris’s court filings deny all allegations, and in a statement to The Cancer Letter, company officials described the action as a nuisance lawsuit.
Scientific justification for the use of the Caris Molecular Intelligence tests is based on a single-arm study conducted in 66 patients with solid tumors who had failed two prior therapies. The study used a novel metric: the patients’ progression-free survival on therapies chosen by the test was compared to PFS reported on their previous progression.
The findings were presented by the researcher Daniel Von Hoff at the plenary session of the 2009 annual meeting of the American Association for Cancer Research and published in the Journal of Clinical Oncology the following year. “In 27 percent of patients, the molecular profiling approach resulted in a longer PFS on an MP-suggested regimen than on the regimen on which the patient had just experienced progression,” the paper concluded.
Von Hoff is identified as executive director of Caris Life Sciences Clinical Research on the company’s website. He is also the physician in chief and director of translational research at TGen in Phoenix, Ariz.; the chief scientific officer for US Oncology and for Scottsdale Healthcare’s Clinical Research Institute; and a clinical professor of medicine at the University of Arizona.
Critiquing the Von Hoff et al. paper in a separate JCO article, James Doroshow, director of the NCI Division of Cancer Treatment and Diagnosis, wrote that the findings are inconclusive in part because it’s unlikely that the patients’ PFS on previous recurrence could have be measured in a uniform fashion.
A randomized study would be required to confirm the positive results, Doroshow wrote.
Doroshow’s division at NCI has reorganized the institute’s clinical trials infrastructure to focus on studies of interventions based on biomarker data (The Cancer Letter, June 20; June 6; May 16; May 2; April 11; April 4).