LungLife AI gains Medicare coverage approval for lung cancer test
Globally, lung cancer kills 1.8m people annually (135k in the US), primarily because many smokers are unfortunately diagnosed only once the disease has either spread, or become metastatic.
This is hopefully about to change.
Today, () - a developer of next-generation early-stage lung cancer tests - said that its patented LungLB diagnostic had received Medicare coverage from 22nd Sept'24, subject to approval of a Technical Assessment (which I understand is standard practice). Here the price has been set at $2,030/unit for the risk-stratification of indeterminate lung nodules under a Local Coverage Determination (LCD).
This is an important milestone in terms of full commercialisation since Medicare is the US government's healthcare insurance program for the disabled and elderly (ie >65 years old) - representing 18.7% of the population or 67.3m people.
Following the publication of the LCD, the next step is for to submit the Technical Assessment in order to receive payment from Medicare. Thus enabling first revenues to commence.
As a recap, LungLB has already successfully passed a pivotal 425 person, 17 site, validation study with flying colours under 'real-world' conditions. Indeed, LungLB achieved a 81% Positive Predictive Value (PPV) in patients with smaller nodules (<15mm) vs 60% and 67% respectively for CT (current standard of care) and PET scans.
Small nodules are the most problematic area for early detection and represent the greatest challenge for physicians. Moreover, the blood test outperformed the highly-respected Mayo Risk Model evaluation tool, with an area under the curve (AUC) of 72%, compared to 62% for Mayo.
CEO Paul Pagano commenting: "Having a Local Coverage Determination for risk stratification testing of indeterminate lung nodules represents a key opportunity for our company. It enables us to progress to the next stage of commercialisation by providing a clear pathway to make our innovative LungLB test more accessible and reimbursable under Medicare. This supports our commitment to enabling 80% of lung cancer to be detected early."
In terms of the addressable market, it's impossible to be too precise - albeit as a rough estimate, I suspect that approx. 1m (worth $2bn) of the 1.5m indeterminate nodules detected each year in the US are both small and relate to patients who would otherwise have had a tissue biopsy.
Lastly, I wouldn't be too surprised either if ultimately decides to team up with a much larger medical diagnostics firm (eg Roche, Thermo Fisher, Natera, etc) in order to accelerate the commercialisation process worldwide - which hypothetically could be anytime over the next 12 months.
House broker Investec has a 220p/share target price on the stock. Watch this space.
stock moved 9.4% higher on the announcement.
Follow News & Updates from LungLife AI:
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.