Strata Oncology Inc. is planning to give away 100,000 free gene sequencing of tumors for cancer patients over the next 2 to 3 years . How really cool is this. (It helps to have $12M in funding). Below is an article which is a reprint from Crains Detroit.

Photo by Tom HendersonDan Rhodes plans to offer 100,000 cancer patients free gene sequencing of their tumors.

Strata Oncology Inc.‘s business model calls for it to give away at least $300 million in free medical diagnostic services over the next three years.

Venture capitalists seem to think it’s a giveaway model that makes sense, having raised $12 million in equity capital for the startup, which is based in Scio Township, west of Ann Arbor.

It’s a model intended to help fulfill the promise of a field called personalized medicine by linking those with cancers caused by mutations to clinical trials of drugs targeted for them.

The disconnect now, which makes it extremely difficult for personalized cancer treatment to actually be personalized, is that most cancer patients have no idea if their cancer is caused by a mutation, and that pharmaceutical companies trying to do clinical trials on drugs targeting cancer mutations waste years trying to enroll enough patients.

According to Dan Rhodes, Strata’s co-founder and CEO, the company plans to break the logjam by offering 100,000 cancer patients free gene sequencing of their tumors over the next two to three years. Private companies, including Foundation Medicine of Cambridge, Mass., charge between $3,000 and $5,000 per patient for such a sequencing.

“Strata will revolutionize drug trials to help deliver on the promise of precision medicine. Most importantly, Strata has the opportunity to give hope to those in need in their fight against cancer,” said Paul Brown, a partner in Ann Arbor-based eLab Ventures, a VC firm with ties to Silicon Valley that joined this round of funding.

ELab also provided an undisclosed amount of seed funding to help launch Strata last October.

Jan Garfinkle, managing director, Arboretum Ventures LLC

This round was led by Ann Arbor-based Arboretum Ventures LLC, whose managing director, Jan Garfinkle, a member of Crain’s recent list of the state’s 100 Most Influential Women, is joining Strata’s board.

Chicago-based Baird Capital also joined the round.

Many cancers are caused by specific gene mutations. Large pharmaceutical companies have drugs in the pipeline that they hope will treat patients with those mutations. As it stands now, said Rhodes, cancer patients generally don’t know if their cancers are caused by a specific mutation or not, and without knowing what mutation they might have, they have no way to get into trials that might help them.

Consequently, drug companies spin their wheels, often for years, trying to recruit enough of the right patients to win approval from theU.S. Food and Drug Administration to go to market.

According to the MIT Technology Review, the drug company GlaxoSmithKline says it had to test 11,000 patients to find just 23 it needed for a study of a lung cancer drug targeting a specific DNA mutation, and the company said it could take 14 years to find enough patients for a large phase-three FDA trial.

Insurance doesn’t cover gene sequencing of tumors, and the cost makes sequencing prohibitive for the average patient, since most cancers are not caused by mutations and most patients paying for their own sequencing wouldn’t qualify for a trial.

“This is a really exciting area. Precision medicine offers enormous opportunities, but the system is broke,” said Rhodes. “There are dozens of precision medicines in trials, but most patients don’t know if they are eligible. You need to sequence the tumor, but the Catch-22 is insurance companies don’t cover it and medical centers aren’t going to pay for it because most patients’ cancers aren’t caused by mutations.

“Pfizer took four years to find 50 patients for a trial. We could cut that to six months,” he said.

Strata’s plan is to offer free sequencing of tumors at medical centers around the country. Patients whose cancers are caused by mutations can then be enrolled in drug trials targeting their mutation.

Strata will get an up-front fee from pharma companies and then a per-patient fee as mutations are uncovered.

Rhodes said he is in serious discussions with 12 pharma companies and expects to sign his first two contracts soon and to have as many as six signed by the end of the year.

Brown said Strata’s three co-founders have national reputations that make investing easier, and finding willing partners in big pharma, too.

Rhodes was a co-founder and CEO of Compendia Bioscience, a 2006 University of Michiganspinoff that marketed an oncology database that pharmaceutical companies used to develop new drugs. It was sold in 2012 to Life Technologies.

Most recently, Rhodes was vice president of oncology strategy at Thermo Fisher Scientific, which is in partnership with Strata, contributing sequencing systems and other equipment. Rhodes said the sequencing machines are capable of sequencing 50,000 tumors a year.

Co-founder Keith Flaherty is an oncologist at Massachusetts General Hospital in Boston, a professor of medicine at Harvard Medical School and a principal investigator with theNational CancerInstitute‘s MATCH program.

MATCH stands for Molecular Analysis for Therapy CHoice. It is a research study that began last July of at least 1,000 patients, matching tumor abnormalities with drugs.

Co-founder and lab director Scott Tomlins is a pathologist and researcher in cancer genomics at the UM Medical School.

Strata employs 15. Rhodes said it could be up to 25 by year’s end.

“Strata’s model makes a huge amount of economic sense. There’s a huge need for improving the efficiency of human trials, which are massively expensive,” said Erik Gordon, an assistant professor in UM’s Ross School of Business, who focuses on entrepreneurship, technology commercialization and the biomedical industry.

“It can take four years to get enough patients to run a clinical trial, and for drug companies, that’s a disaster,” he said. “Time is money. If a drug will generate $1 billion in sales a year, that’s $4 billion lost.”

Gordon said that getting 100,000 patients sequenced over three years may prove to be overly ambitious. That would require Strata to recruit 91 patients a day.

“It’s a great idea, but there could be a problem finding enough cancer patients that fast whose cancer isn’t being treated already,” he said.

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Original link: http://www.crainsdetroit.com/article/20160619/NEWS/160619785/ann-arbor-startup-opens-doors-to-cancer-trials

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