Antitrust changes force ‘multi-cancer’ testing firm to curtail research

Grail executives spoke about efforts to contain costs, pulling back from efforts to help doctors track cancer in patients who already have it, and focusing on efforts to gain regulatory and insurance company support for its existing Galleri cancer test.

Grail is also seeking regulatory approval for a second version of the Galleri test, which will detect fewer indicators of cancer and will be cheaper and easier to make available to more people.

The company’s executives discussed the changes Tuesday during a conference call with securities analysts.

Grail is making the changes because of an October 2023 decision by the European Commission to force Illumina, the large biotech company that once owned Grail, to spin off Grail into a separate company. The commission argued that allowing Illumina to keep Grail would stifle innovation and competition in the market for blood-based cancer tests.

The separation from Illumina limited Grail’s access to investor funding.

What does it mean

Employers who were hoping to offer their employees the Grail cancer test may have to wait.

Investors and regulators aren’t necessarily rushing to Grail’s aid just because the company has a blood test for early cancer detection.

The path to commercialization

Bob Ragusa, CEO of Grail, said the company’s employees remain passionate about its mission.

“In practice, Galleri has detected many of the most aggressive cancers in their early stages, including pancreatic, head and neck, esophageal, liver and stomach,” Ragusa said. “For most of these cancer types, there are no other screening options available.”

Grail sold 35,200 tests in the second quarter, which ended June 30, executives said.

The current version of Grail’s Galleri cancer screening test costs $949 and is not typically covered by health insurers or employer-sponsored health plans.

Grail has already proven that the test is safe and detects cancer, but research is still ongoing to show whether the test can help reduce the number of advanced cancers in people who undergo it, or whether the test simply reveals many small or slow-growing cancers that would otherwise be unlikely to cause serious health problems.

Grail worked with Munich Re to convince life insurers such as John Hancock and MassMutual to offer the Galleri test as an additional benefit to their policyholders.

Some insurers have considered offering voluntary or workplace insurance products that would cover the types of genetic sequencing procedures used in the Galleri test and in certain studies to diagnose and treat cancers that doctors learn about through the Galleri test, other screening tests, or patient complaints about symptoms.