Proactive Genetic Testing Has a Life Insurance Problem — Sam Raha

Uh an NBA player, rather than that, now we're using something specific to an individual. We often call it a biomarker. something that's related to the genomics or genetics, DNA or RNA based it could be related to protein or a protein profile or some combination, but it helps us. When I say us, I mean the industry, science and medicine. To better match a particular drug or a treatment with an individual with a much higher likelihood of it having the intent.

for for a drug, right? That's been the motivating factor. And just to be clear, if I were a pharma executive or from a pharma perspective, Precision medicine for a long time was not seen as a friend because for a pharma company it's like, hey, a drug that works for everyone is the ideal thing.

But the recognition that, you know, often that y you know, the sort of clinical studies or the evidence that are required are much more difficult across just the generalized population. Then increasingly we have targeted therapies, particularly for cancer, for other dr um other sorts of diseases too has led to, you know, the uh the rise of the importance of biomarkers, which is tied to then precision medicine being used for

uh particularly drugs that uh that are you know in in the cancer arena again. I will tell you, I said there's two part two part answer. The other part is I I I think a a huge important mega trend that's happened over the last five to ten years, particularly we saw it through the the pandemic. We can talk about the pandemic now as if it was truly five, six years ago. We saw that humanity is really interested in better understanding, monitoring and managing

our own health, right? People are and and not just folks that have a a scientific background. For example, right, dur during the pandemic, next thing you know, the general public's talking about spike proteins on on COVID COVID nineteen. I say this because, you know, the combination of this interest, the combination of wearable devices to monitor our sleep, to monitor our heart rate, all of these to me are are important leading indicators or co factors.

That I think will drive further adoption of really managing individualized health on a more prescriptive, tailored basis.

And precision medicine absolutely has a correlation with that. We are going to as individuals and society seek out in a course of treatment, uh a drug being one form other things we can do therapeutically, treatment wise other forms where this approach of precise medicine for an individual I think is gonna become a a bigger and bigger thing over the next decade and decades to come.

We are at Myriad a leading precision medicine and molecular diagnostic. So what we do, the core of our business, is to develop and provide testing solutions, cancer being the most important area of our focus where we think and really continue to be a leader and and, you know, redefine the new myriad, if you will, of serving the full cancer care continuum.

while also serving prenatal health and mental health. But our job is to do that. Testing solutions, serving healthcare providers, healthcare systems, ultimately patients. We served over 1.5 million patients last year, working with 55,000 healthcare providers. Now it is very important to you know, that I convey the importance of pharma as a a critical partner. So we work with pharma companies who are seeking to develop uh or to leverage precision medicine by having diagnostic tests.

that help individuals select or better identify individuals who can benefit from their

companion diagnostic tests. In this case, it is our HRD, which is homologous recombination deficiency. It's a sort of a thing in terms of DNA repair. Using HR D one can really more effectively select individuals that can benefit from PARP and So we are the companion diagnostic test, it's called My Choice, that is on the label, for example, for AstraZeneca's lymphar.

Now, this is this is very interesting that it starts there, but then often, you know, oncologists or doctors they can have the opportunity at their choice, at their medical discretion, to use the companion diagnostic.

How unique are those ones where it's really a one to one and how much of this is kind of like, Hey, your odds go from thirty percent to fifty percent depending on, you know, is it more of a spectrum?

through clinical studies that show uh a very strong correlation to the level you can say there's extreme high confidence and you know that's where the FDA in this country and other regulatory bodies around the world have its role. Now Tad the question you ask is very important because In science, what we know is in a very simplified way, as many of us learned decades ago, the simpleton view of genetics is one gene is

be it eye color or whatever, right? And and that's called monosystronic, meaning one gene, one condition. But more often than not, just like you said, things that happen that that manifest in how we feel, how we look. what diseases or prevalences we have or correlated with multiple genes. And there's a very important factor of the genetic basis combined with what we call epigenetic.

Things that are happening not just in the our program DNA, but things that are beyond that and all the other things in our body, and of course, environment, right? Nature versus nature.

of precision medicine, it's millions and millions, if not tens of millions, of people. per year are being prescribed drugs based on precision medicine. So I think it has arrived, Tad, but I think the opportunity for further adoption and precision, pun intended, of how it's used is ahead of us, again, particularly to be, I think, incorporated using other lifestyle monitoring capabilities like wearable.

protein profiling uh to do. So yeah, I I think I think it's there. You talked about drug delivery. I think it's fascinating the advances that are happening there. And you think about these truly next gen sort of drugs that are happening based on SIRNA or these, you know, silencing RNA and um oligo-based drugs. Uh and you know that to deliver that, there's new methodologies, right, beyond oral subcutaneous injections.

to IV and other things, how do you actually get into the cells? How do you, you know, deliver with precision to the targeted region of a organ or tissue? So a huge advance is happening there as well. Fully, yeah, it's not my area of expertise, but I was pretty close to it at Agile for a while. But um, you know, genomics has has a huge opportunity to to to help with profiling and and management of health going forward as well.

you know, even something which we've been using for pardon me for a long time because you talked about heart disease is, you know, eth ethnic background. So Sri Ram, for example, you and I, my friend, it's just a known fact through Millions of people that have been observed that, you know, being an East Asian individual, there's an elevated risk of heart disease.

It's due to, you know, how fats and lipids are metabolized and and so forth in our bloodstream or, you know, therefore what happens in our bloodstream. That's precision medicine, by the way. It it's a gross form at a very high level. But knowing that, you know, the sort of care vigilance that an East Indian man should have by the time they're in their thirties or forties.

is different from certain individuals of other ethnicities, right? Now, what we're talking about is advancing precision medicine. Clearly we're talking about biomarkers, things that we can't see with our eyes or observe, so we're actually using you know, very high end, high resolution science that's been backed with extreme clinical evidence and studies, which is exciting because then we're talking about, you know, the sort of determinations that are only enabled by

Or you know, some other way of looking at this. Generally as somebody who if somebody's inve interested in investing in, you know, pharma, biotech, that sort of thing, how does this the increasing prevalence of it change that investment landscape?

will realize okay this is working. And I'm just thinking monetarily, if it works, a course of treatment, that should lower the burden not only for the patient of healthcare, but that should lower the cost for the healthcare And if that's the case, if I was a healthcare system, be it a doctor, administrator, and insurance carrier, I am more likely to support that.

you know, include that as something I cover, and that would lead to further adoption of that drug. And that adoption was enabled by Precision Medicine. So that is why I think that You know, this is uh supporting reasoning for why precision medicine can not only be good for patients, but I think can really be good for overall economy and and for investors.

And therefore all the value stream I was talking about have broader adoption. So once they recognize that, they will reach out or, you know, companies such as Myriad uh will be in constant conversation with the leading pharmaceutical companies to say, hey Where else can precision medicine benefit?

So through that there's an agreement that is structured specifically be it on the evaluation, identification of biomarkers that could be relevant to a particular drug, to the then the um the validation of biomarkers, to the actual development of the companion diagnostic Through to the registration with the FDA here or the other relevant regulatory bodies around the world. So all of those pieces.

are either combined into one more sizable comprehensive agreement or they can sometimes be more a la carte, but that is a contracted body of work. Now so that the the economics are there, we're getting paid, you know, for for for the work that we're doing. Separate than that, when a Drug then comes to market and the competing diagnostic gets approved for it. Companies such as us then benefits by being the

the companion diagnostic test on the label, therefore the adoption, the utilization by the marketplace, right? That means docs, oncologists who are saying, hey, I want to determine if my patient is, you know, would benefit from this drug. So what's the companion diagnostic test that I need? And it should be set up where, hey, myriad is is who they call and they place the order with it and

How does that, you know, first is that settled law now? And then given where the law has settled, how do you have the economics of making these big investments in R and D if you can't patent some of the key things that you're researching?

we being the most famous one, uh, the ability to, you know, have that sort of emote, if you will, or competitive advantage over anyone else being able to do that. Uh yes, it did go to the Supreme Court and, you know, there was a decision Uh broad standing that was made that as you said, genes are not patentable. They belong to all of us. Wan I wanna say that a hundred percent with complete, you know, not just confidence.

Full emotion, we at Myriad, the New Myriad, for a long time, have 100% stood behind the ruling because we believe, yes. Genes belong to all of us. That being said, there are other ways that we can still differentiate and retain differentiation. A lot of that so there's still patents that can be applied for and granted related to techniques and to into how you isolate DNA.

to the specific set of biomarkers, which includes not only how you analyze but the the interpretation, the the the methodologies that are used. For bioinformatics. All of those things together provide some level of differentiation, which I think is important, that allows us to, if you will, protect.

some of our work for some time. So I I think that the world has changed and we're we're glad for it. And in the new world a differentiation is earned based on a differentiation of excuse me, the merits of how your test is differentiated, also how well you're able to have reputation and reach to serve the broader

with this sort of cluster of other kinds of things you can patent, does that end up putting you in a similar situation where you can make massive investments in R and D with confidence that you'll recoup them? Or do you have to have to move more of your investment into, you know, sales and manufacturing and branding and those other, you know, less IP heavy activities.

There's a lot of trade secret too on fundamentally how do you actually process samples, the efficiency you could do that with, the quality and the turnaround time that you could do it with. And these are areas that Myriad is absolutely among the leaders. Huge differentiation that, you know, really makes a difference when you're serving millions of patients is your cost structure.

And so how effective you are in in being able to do that at a cost point that really gives you meaningful margins. For example, for Myriad, our gross margins are around 70%, which is industry best. that also gives us the ability to invest, like you said, Tad in these

which are important ways to reach more and more healthcare providers and ultimately patients through sales, marketing, awareness, the other things that you do, um, in a medical setting, right? It's different than the consumer world or different than the life science tools world, but we have to in our space very effectively at the same time be able to ha share the value proposition and answer questions for patients, for actual healthcare providers, doctors, nurses, as well as healthcare systems.

But all of those things together provide, I think, meaningful difference.

you know, coming off, uh oh, you know, it's a huge, you know, what do you do at that shelf? That sort of thing is no longer, you know, as much of an issue.

you know, areas of discovery, where do you see AI in in your field? Is it more rapid development of new technologies? Is it expanding your product suites? Is it improving margin? Where do you kind of see some of the the major impact that your teams are seeing.

how it's being used, for example, even to better batch and make our labs more efficient every day. As the samples come in, you know, how do you make sure you're you're getting the best combination collection? So, you know, it helps us turnaround time all the things and And um and that. On the other hand, or so the other end of operational part of it, diagnostic companies, microdiagnostic companies like us, one very important reality for us is working with insurance companies.

and the denials uh that they have and you have to submit just a litany of answers to questions that come. We have already used AI so insurance companies now, it's been a couple of years where they've used their bots and other AI to take away humans and do you know to keep serving up new questions, if you will. we have then created our capabilities to work alongside or I don't know if you want to say combat but to engage with their bots and we've taken what previously would have taken

Six months down to like weeks. So that's an example of real well-time AI. So that's category one, operational. Category two, very importantly, is the customer. All the way and this is not unique of course to our industry. We all experience it. You go to a site, there's an enhanced way to learn about what we're looking for and get the support that we need, both on the front end and then equally for us.

when you're getting an answer of a test report, both for patients and the healthcare docs and providers of like, what does this mean? What do I do? Here are my the and questions that I have. How do I get that support without always needing a human, right? But the third area which is equally exciting and happening AI becomes a fundamental component of the product or of the test. We're actually very excited this quarter by June, we will be launching our first AI-enabled prostate.

And what this means is you're actually there's a component of the test where an algorithm essentially has been tuned to be able to discern in a digital way by looking at cell morphology something that would otherwise take hours and hours of for an individual to do and one couldn't even do without the database of thousands of other samples that have been looked in a certain way. The punchline is now using that together with molecular is gonna provide a level of confidence

for doctors of what to do, particularly on s certain patients that previously were like, the gray line, I'm not sure if you should have this treatment or if you should just wait. Now it's like boom. I think th you know, I have confidence here's what you should do. And in cancer few things are as important as time and being able to move and and make make a decision. So

Three areas of AI that are very that are this is just kinda like your question, Tad earlier is precision medicine. Is it gonna happen or is it happening? AI in our space is happening every day. We're adopting it, we're leveraging it, we're trying to make it we're trying to be aggressive in allowing it to to really be important.

when we use Claude or we use whatever chat GPT, the ability to synthesize from so many different points of information and to draw a conclusion, which humans always should, you know, through the clinical studies confirm that this is making the right call. I think it adds a whole different level of power.

This medicine's more likely to work. You're saying AI is kind of taking it to that final step of for Sam Raha in particular, given his exact genome, it's as though you had a team of scientists looking at your genome and got to the answer. So it's most precise medicine is that? a kind of fair way to think about what it's doing.

precision medicine approach, right? So I think about it that way. And I can't wait it wait for it to be what you said because that sounds fantastic.

What I appreciate is they are open to and want to engage and learn even before we bring a um you know bring a test in front of them to approve. So I I think that as an industry, you know, between companies, between academia, thought leaders, and regulators like the FDA, we're we're gonna evolve together, I I hope, pretty quickly. The one part Tad that I I I I wonder often lags in our industry is how you get

It's the reimbursement. So there it is a little bit, I think might be it might take a l might lag a little bit on the full incorporation, if you will.

because rightfully I would say doctors and healthcare systems that are treating patients, along with companies like Myriad, we want to provide broad access to individuals So, you know, it is more often than not that we are not gonna hold back. timely manner providing a test. Even though we know on the back end we're gonna have to go through a process to be able to collect from, you know, private insurance companies, which, as you know, is a very big part of how companies like Myriad get paid.

So that is the that's the reason. I think it is just another new step of the process. Listen, working with them and they're they're great humans there too to find a way to ensure we get paid on a timely basis the amount we

we deserve is is something we're we're collectively working on. I I happen to be on on the board of one of the leading industry groups. We call it ACLA, the American Clinical Laboratory Association, which also has membership. And you can take a look at all the other CEOs from the other big companies.

And we we care a lot about both getting properly remunerated as an industry for the work that we're doing and ensuring that AI is also thought about a and not to take us backwards from getting paid, but Consistently is something that we are contemplating and and and working on right now.

can make a determination of what to do or not to do with that information in combination with all other rich information about their health and and health management. Now sometimes knowledge of one's genomics, genetics can be unsatisfying because we can find out that there is a mutation or something, but there isn't a obvious treatment.

So that is a, you know, true limbo. It's like great. If the check engine light didn't come on, I'd been pretty happy even though chances are the the car might not work in two years. using that analogy. So I I think this is where science continues to advance. We continue to learn about more conditions. It'll be more satisfying. But I fundamentally believe that knowing more

gives us an opportunity to do something with that information or not and can lead to other investigation and other pursuits that can ultimately help an individual and or their families, even if not them, right? That's the other thing. It's not only about optimizing for an individual because genetics are such a way there is often a very strong correlation of what could be happening for that individual.

Not only children, siblings and others, so there can be a benefit even if not to that individual. But I I absolutely understand that it is. It is not it is complex. And and for some individuals, having information and not always having uh A leads to B is not something that they're comfortable.

there have been cases where they felt like even if you do nothing or even if the probability risk adjusted analysis of X leading to Y or choices you make, but it it ends up being a you know a preexisting known condition is a strong word because a condition is all relative, but a pre-existing piece of information that

you know, has caused in denial of claims, unfortunately, in some cases. Um I don't think you have a response to a question there, but trying to I think that's been sort of a Personally also I've kind of said, Well, do I really want to go through a Grail or a Pranuvo or all these kinds of things that could be illuminating for better or for worse to give more knowledge but then create sort of a system of per literally a permanent record that

could otherwise have other challenges for myself. Any thoughts on that?

Y you know, which which which doesn't seem like the right way to go. Particularly because Sri Ram, as you said, there are things going back to a question you asked me earlier. At the very beginning, very few things are just directly tied to 1G. And if you have this 100% you're gonna get this, or 95% or more. It is about levels of likelihood in in many cases.

There are the whole purpose and the value is if you can find out and there's levels of probability, then you're able to combat and lead to a different better outcome.

So I think in some ways there has to be other there has to be information, data, policy that comes together, including all the constituents like insurance companies, because they benefit too if the people that they're covering actually have the knowledge and Work and seek out, you know, different lifestyles, different medications, other things that they can do, that could ultimately ultimately benefit them.

And the other thing, because you didn't quite ask me a question, right? You gave me a statement, you allowed me to opine so I'm opining here. I think I just saw earlier this week or in the weekend that Australia just passed a law um something along the lines of restricting insurance companies to use genetic information in an We we should check that out if that's true, but that would be a landmark in terms of a country uh you know advancing in the

for different markers of me personally. And I got this firsthand. Like, you know, I did my regular blood tests and I had a r I had my normal PCP and they were like, well, this number doesn't fit on this line and we need to go further. And then I recently switched PCPs for different reasons. And he was like, no, this is totally you're South Asian. We just have a generic.

you know, set of high and low and you're not anywhere you're high in the generic American data set, which if you dig deeper, that American data set is highly biased ethnically, no fault of anyone's, but just happens to be the way it's set up.

So I happened to switch for different reasons, but I would have been moderately alarmed because of this. So I guess all that to say You know, how much agency should people be putting and you know, I I have friends are relying on these tools, they're uploading their functional blood tests into

you know, a number of these chat bots even to get better anal or analyses, I shouldn't say better, but getting analyses and so much and then the education of the doctors and the medical professionals themselves.

Wrapping it all up, how would you how much onus or would you say our individuals should be placing on this set of data and taking control of it and being equipped, but also not coming to the doctor and like Asking Web MD questions and they're like, oh no, here's another one trying to like be a doctor themselves, and I've gone through fifteen years of training.

I mean there's some very important factors that that are tied to that. One, you know, doctors in this country, if we stay in this country, because it is, I think, country by country, even though there's commonalities in this country, doctors are able to spend very little time

Right, with an actual patient. Often they see eight to ten to twelve patients within an hour. And the pre work and the postwork that they're able to do to really understand is is limited. That's just the system. Two, as you said. Often, even if a doctor, without going deeper, looks at a data set, they're going to look at the generalized set, which is often based on cohorts that don't represent.

An individual who happens to be in front of them or is asking questions. I think those are facts. I think the the other thing is The science is moving so fast. And an individual can often today, and it's getting better, because truly, fifteen years ago it was WebMD, that was one source, but now you you we're able to triangulate through multiple sources. Seek out answers. And I think that understanding oh, the I was going to give you another huge structural thing, right? On average,

In this country, an individual is with a particular insurance provider for two to three years, no more than three years. So even that, there's like information lost, even fundamentals of carrying our own x rays, test records, and all that, we're trying to make it better. But these electronic medical systems often don't talk to each other. So if we don't care about our own health and carrying that information,

and to advocate for ourselves, right? Again, our sis healthcare system this country primarily is about until it ain't broken, we're not gonna do much. It's only for uh, you know, acute serious conditions that there's treatment. Other than that's like defer, defer, defer. I know from my standpoint I don't want to defer, right? I think proactivity is the way

or for my children or you know, grandchildren one day, it it's all about being proactive. So I've got a strong perspective. We've got to control our manage our own destiny by understanding and bringing information.

which is to to better understand the correlation between, you know, parents and a child to help that. Screening, like uh Hallmark Test. It's the market leader for genetic basis of cancer. We call it my risk. Absolutely. You know, my my um my family has done it. I think we we should all it's not only for one

So we're men too, we should do that. But there's more. And I think Tad what I find really fascinating is so our son's twenty two, our daughter's twenty five. Even me being proactive, like to them, like these wearables, this w knowledge, understanding so much more like they've grown up in the digital and the AI.

time frame, they're also carrying in a whole different way. I mean they have com whereas like maybe when we were younger we talk about we get together and this is this is gonna be a I don't know, this is a good example. Talk about the baseball, what's going on in baseball, football around us or you know current effect.

current events, I I hear my kids get together like, Hey, tell me about your score. What did you see on your profile? I mean, th it's a whole different conversation set that's happening. So I think that's gonna be good. I think there's interest and That's gonna lead to, hey, what other tests can I do proactively to better manage? I think one has to be vigilant too. You you shouldn't go get every test. perspective because you can go a little overboard with that as well.

think people should be exploring it.

and do. So that's one thing. I think another thing is increasingly uh there are actual courses that are offered um, you know, online, uh, not just in person that that that that that's happening. By accredited you institutions, you could even do it at your local community colleges, but you know, major universities offer that. I remember I it had a huge impact on me. I I am that geek that isolated DNA when I was thirteen, which was a big deal. Now our kids all do it.

First grade or second grade with strawberries, right, in an Inzaplock bag. But you know, so going and getting hands on, working in a lab with genetics, I think can really help with with a different level of understanding beyond the books. And you know, and and there are so many folks who are in the space that are willing to spend time. So find STEM related

organizations that they can they can learn from or be a part of. I think all of these things or reach out to companies like Myriad. We have a great program for for internships and other ways of learning, right? So all of these things are avenues I think young young folks makes me feel very old to say young folks or young people can pursue.

But along the way, as I say, crossed over leading businesses, which I've done for twenty five years now. And so my particular passion is bringing together truly groundbreaking science that can make an impact in a way that it makes financial. value.