) subsidiary, Genzyme, recently announced that it has entered into
a co-promotion agreement with Veracyte, Inc., to provide a
personalized solution for thyroid patients.
As per the agreement, Genzyme will shoulder the
commercialization responsibilities of Veracyte's Afirma Thyroid
fine needle aspiration (FNA, a minimally invasive procedure in
which suspected cells are extracted for test) analysis, which helps
in competent thyroid nodule diagnosis. Genzyme will commercialize
the product in the US first and later in rest of the world.
Detailed terms of the agreement were not provided.
The agreement follows the announcement of a positive coverage
decision taken by Palmetto GBA, a national Medicare benefits
administrator, on January 9, 2012.
Genzyme currently has a thyroid cancer product, Thyrogen
(thyrotropin alfa for injection), in its portfolio. Thyrogen is
approved as an adjunctive diagnostic tool for serum thyroglobulin
(Tg) testing with or without radioiodine imaging. It is also
approved as an adjunctive treatment for radioiodine ablation of
thyroid tissue remnants in patients who have undergone complete or
close to complete thyroidectomy for well-differentiated thyroid
cancer and who do not have evidence of advanced thyroid cancer.
Afirma and Thyrogen together will facilitate better diagnosis
and treatment of thyroid cancer patients. Veracyte's product will
obtain more visibility in the US and rest of the world using
Genzyme's sales force and infrastructure.
Thyroid nodule FNAs are a popular method of diagnosing thyroid
cancer, with approximately 450,000 such procedures being performed
in US annually. However, in approximately 30% (135,000) cases, the
results are inconclusive.
Among the unclear FNA results, approximately 20% - 30% patients
have a chance of suffering from thyroid cancer. Thus, for better
diagnosis, surgery is recommended for most of these patients.
Surgery is both invasive and costly and can lead to several side
Afirma has the potential to prevent many unnecessary surgeries.
According to a study published in the
Journal of Clinical Endocrinology & Metabolism
, routine use of Afirma would reduce the direct cost by more than
$600 million in a span of 5 years.
We currently have a Neutral recommendation on Sanofi. The stock
carries a Zacks #5 Rank (Strong Sell rating) in the short run.
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