written by reader Cologuard by Exact Sciences

By Anonymous Questions, October 27, 2014

from morning news about new colon cancer dna test called cologuard by exact sciences mkt. cap $1.95B. Missed Oct. earnings, Down 1.3% premkt. Any information? What may be yours and Dr.Kss and Blind squirrels thoughts. signed an Avid follower. and of course many many thanks

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Travis Johnson, Stock Gumshoe
October 27, 2014 3:36 pm

The only analysis I’ve read recently on EXAS was negative, the short argument made by Whitney Tilson and others, and I know Dr. KSS has been negative on the viability of the company’s colon cancer test in the past. Part of the short argument was that the reimbursements couldn’t possibly be high enough for their Cologuard test to make them a profit, since the competing test is similarly effective and is extremely cheap (part was also that the patient’s task with cologuard is much “grosser” than with the standard test).

Part of that short argument took a hit a couple weeks ago when the reimbursements came out better than expected, so that’s what’s keeping the stock pretty elevated here — the small drop on earnings is backward-looking, seems to me that investors are very focused on the future with increased cologuard usage (and higher reimbursement) still. Haven’t read the company’s commentary and I’m not terribly interested in this one, despite my strong interest in colon cancer detection and prevention (family history) — I hope it helps, but most people I read don’t seem to think it really will be substantially better than existing screening, or get through to the people who are now unscreened.

That’s just my thoughts. The company is not expected to be profitable for a couple years, current earnings are pretty meaningless and revenues are tiny until Cologuard really ramps up (if it does) — just try to understand what you think the market really is and what share of it they can take, and how long it will take to get there, that’s probably what analysts are doing.

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richard spinthall
Member
richard spinthall
November 2, 2014 12:22 pm

Medicare will pay for it (cologuard)

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DrKSSMDPhD
November 2, 2014 3:15 pm

Yeah, for now….till they realize how much, how many billions of dollars, it wastes. If the test is positive, God be with you. You have colon cancer and you are in deep doodoo. If the test is negative, what have you learned? Why… nothing! Doctors will say, Hey your Cologuard is negative, you’re good and send you home with a bellyful of polyps all growing into cancer. A negative Cologuard tests means absolutely nothing. In five years, Medicare coverage for it will be gone. And Medicare coverage or non-coverage for ANYTHING has never been a barometer of legitimacy, merit, applicability or need. It nixed PVP Greenlight lasers for BPH when they first came out only to realize the approach saves millions and is far safer than TURP.

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DrKSSMDPhD
October 27, 2014 5:47 pm

Gastroenterologists everywhere, including me, are snickering at Cologuard and Exact Sciences.

I pose a challenge to ANYONE reading this who happens by: devise for me, if you will, a scenario in which Cologuard will be useful, save lives and be good for someone. Maybe I am blind, so point me in the right direction. Dream up a situation in which a smart doctor will direct a patient to use this, and it will HELP the patient, and be better than standard of care, and oh, while you’re at it, also NOT gratuitously cost the system money.

I’ll check back later, but I really want whoever posted the question in the lead-in part to answer my question. I am not out to humiliate you, but out to show you how INSANE Cologuard is.

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Tim
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Tim
October 27, 2014 6:03 pm
Reply to  DrKSSMDPhD

is this test like hematest or hemacult?

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DrKSSMDPhD
October 27, 2014 6:07 pm
Reply to  Tim

No, it tests only for DNA unique to colon cancer. A certain set of genetic markers typifies 90 plus percent of colon cancer.

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hedy1234
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hedy1234
October 28, 2014 1:49 pm
Reply to  DrKSSMDPhD

May I suggest this scenario as possibly adding some value for this product?
If a person has a great fear of surgery/colonoscopy and only wishes to do that as a last resort, can a negative result from this test be used a reasonably reliable basis for not having a colonoscopy or a second colonoscopy after 10 years?

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DrKSSMDPhD
October 28, 2014 2:03 pm
Reply to  hedy1234

I respect your point Howard. I would respond in these ways. One, I genuinely understand patient terror as few do. One reason I went into medicine is that I was born so neurotic that I routinely fainted when seeing blood or hearing a gory story up until when I began medical school. I wanted to overcome it, and even now, I am terrified of being a patient. I often share that with terrified patients because I want them to know I do not belittle them. I have sometimes shown them videos or had them speak with other terrified patients who lost their fear of colonoscopy after having one.

Second: What is the goal of colonoscopy? It is NOT to look for colon cancer. It is to look for polyps. ALL cancers begin, 5-15 years before they become cancer, as polyps. The goal of colonoscopy is to find all polyps and cleanly, painlessly use a thermal snare to remove them. If you wait til cancer is at hand, the barn has burned down. A negative Cologuard does not mean you do not have polyps and does not exclude cancer or pre-cancer, as absence of evidence is never evidence of absence. A negative Cologuard test in no way doesn’t mean one doesn’t need colonoscopy.

What’s going to happen is a Laurel and Hardy fine mess: people will skip colonoscopies, get cancer, get Cologuard, then get colonoscopy, then be diagnosed with cancer, then need surgery……and the whole system will be paying 10x what it does now! And after they have their colon removed and get a colostomy, they will still need annual colonoscopy for the next 10 years!

It is ALL prevented by screening colonoscopy beginning at 50 for most, at 45 for people of African ancestry, and for people with a first degree colon cancer relative, colonoscopy 10 years earlier than that relative’s age at diagnosis.

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Travis Johnson, Stock Gumshoe
October 28, 2014 2:16 pm
Reply to  DrKSSMDPhD

And on the effectiveness front, I think the argument for cologuard’s DNA component is really slim — compared to a much cheaper standard of three hemoccult tests it didn’t do significantly better as I remember. It did do slightly better than a single hemoccult, if my memory is correct (haven’t re-checked), but the cologuard also includes their version of the hemoccult test. This is one where logic really seems like it might win out, on costs if nothing else, and it is hard to see it making sense to do something so expensive that has limited (or maybe no) added value and might deter something that really does have added value (colonoscopy).

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Claude26
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Claude26
March 18, 2019 10:59 pm
Reply to  DrKSSMDPhD

Hi DrK, I was listening to a local Dr. on the radio this weekend that likes the Cologuard because he had a patient that tested positive with Cologuard and was referred out for a follow up with a scope. The second Dr. didn’t find anything with the scope but, because of the test results, did more searching and found an area at/ in the appendix area that was malignant. The primary Dr. credits the test for saving his patients life.
Truthfully, I could be fuzzy on the details since the main reason I looked for a discussion on this topic here was to see if it might be something to invest in. After reading thru everything else I see that it likely is not going to be setting any records but just wanted to throw in what seemed like a good anecdote.

hedy1234
Irregular
hedy1234
March 19, 2019 10:02 am
Reply to  Claude26

Claude

Please note that Dr KSS has left this building. He no longer reads or posts here. You responded to a note that is more than four years old.

If you are interested in bio tech investing, he started his own website called biopubkss.com. It requires a paid membership.

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DrKSSMDPhD
October 28, 2014 3:15 pm

Agree Travis. The thing is, if one is afraid to undergo colonoscopy, is that person really prepared rationally to deal with a positive Cologuard test result,

Martin Mull is fond of saying: “Smoking? Hey ANYONE can quite smoking, but it TAKES A MAN to face lung cancer.” Same with Cologuard. When that test comes back positive, you are hosed: you have waited way too long! Get your colon run when you’re younger, before you can have cancer and get the polyps plucked before they ripen into something wayward, and Cologuard becomes useless. By the way, a negative Cologuard test in no way excuses you from needing colonoscopy. Colonoscopy is not to look for cancer. It’s to look for polyps, and remove those before cancer sets in. No other human cancer has the precise, predictable progression of hyperplastic polyp —->adenomatous polyp—–>malignant polyp—–>invasive colon cancer. This gives years to intervene.

I will be both shocked and disappointed if private payers ever cover it. I suspect Medicare will drop coverage soon. It is an irrational use of resources!

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gard
Guest
November 3, 2014 11:27 am