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by Franziska Moeckel, MBA

Consumer-Directed products, in the context

of this article, are services that may or may

not be marketed directly to consumers and

can be purchased directly by the individual

but that require a healthcare professional to

order the test or test bundle. Some recent

examples include Color Genomics – a company

that offers affordable genetic testing, including

BRCA1 and BRCA2, to help understand genetic

risk for breast and ovarian cancer; Arivale – a

business dedicated to providing individuals a

scientific path to wellness; the Health Nucleus

– a wholly owned subsidiary of Human

Longevity Inc. that is the first-of-its-kind

genomic enhanced, research based health

platform; Veritas Genetics – “the first

company in medical history to offer

individuals the opportunity to easily and

affordably unlock the secrets of their

entire genome.” While Color Genomics

focuses on making genetic testing accessible

and “allow[ing] people to catch cancer at an

earlier and more treatable stage or prevent it

altogether,” Arivale focuses on wellness “by

leveraging an individual’s unique genetic

makeup, clinical lab data and lifestyle to

optimize wellness and avoid disease.” The

Health Nucleus, also concentrating on

wellness, “uses whole genome sequence

analysis, advanced clinical imaging and

innovative machine learning – combined with

a comprehensive curation of personal health

history – to deliver the most complete picture

of individual health.” In comparison,

Veritas Genetics promises that “you can

sequence your entire genome and gain a

completely new understanding of what’s

possible when it comes to using your genetic

information together with your doctor to

improve your health and longevity.”

There are many other choices. Healthcare

providers – independent practitioners,

physician groups, and health systems alike,

are increasingly confronted with DTC and CD

products as part of their day-to-day practice,

a trend that is anticipated to only grow in the

future as the sophistication and curiosity of

empowered, educated individuals regarding

their genetic makeup (and other organisms

living within the human body) matures.

W ith more and more Direct-to-Consumer (DTC) and Consumer-Directed (CD) ‘Omics products hitting the US market, leading providers, physician groups and healthcare systems in the field of personalized or precision medicine have a decision to make. Should they be active participants in the Consumer-Directed and/or Direct-to-Consumer movement; should they invest in alternative offerings; or should they even separate themselves from such products completely? Experts in the field define Direct-to-Consumer (genetic) testing as testing sold directly to consumers via various marketing channels, including TV, the internet, social media platforms or other marketing venues without involving a healthcare professional or insurance company. Companies such as 23andMe – a leading personal genetics company with the goal to help people access, understand and benefit from the human genome, and uBiome – a citizen science project that allows the public access to cutting edge sequencing technology to understand their microbiome, are just two prevalent examples for DTC testing. While 23andMe markets itself as the “first and only genetic service available directly to you that includes reports that meet FDA standards” and includes reports on carrier status, ancestry, wellness, and personal traits, uBiome, on the other hand, allows an individual to “explore your microbiome” by extracting bacterial DNA out of an individual’s sample.

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People who have participated in one of the

DTC testing services approach their primary

care physician (or specialist) and present

their results with the expectation that the

information is either understood by their

doctor or that this information should be

part of the treatment pathway and medical

record moving forward.

Regardless of what the situation may be,

providers have a choice to make: to either

participate and partner with patients and

these companies, to build their own version

of DTC and CD offerings, or to ignore this

trend altogether. They can choose to lead

the movement, follow the leader, or watch

from the sidelines (Figure 1). Yet, there is

no black-and-white answer to this question.

When taking an active approach to this

overarching strategic issue, assessing whether

or not a product is worth the investment by

evaluating many competing elements before

making a business decision is crucial. The

framework below can assist in making these

decisions.

l Legal: Reviewing company policies and

compliance with the Food and Drug

Administration (FDA) regulations if applicable

– especially for DTC services.

l Media: Researching paid and earned media

content. Is the tone positive, neutral, or

negative?

l Marketing: Estimating the company’s

marketing engine and strength in conjunction

with the associated brand awareness and value

in your market.

l Core Competencies: Understanding the

company’s core competencies in comparison

to your own, e.g. clinical testing quality, report

information comprehension levels, customer

service, etc.

Product Overview and Fact Gathering

To understand which product(s) and service(s)

the company is offering and associated

customer group(s). This step includes:

l Test Benefits & Target Market: Summarizing

product offerings and benefits for each target

customer group – especially the individual;

assessing user interfaces based on user-

friendliness and a certain “fun” factor.

l Cost Structure: Listing test costs as part of

the service package, incl. individual and bundle

test costs, discounts, membership models,

affiliation programs, premium versus standard

services etc.

l Technical Test Specifications: Reviewing

the list of genes (or other test specifications),

laboratory environment (can be multiple

laboratories at different locations) where each

of the tests is performed (internal/external

laboratory, Clinical Laboratory Improvement

Amendments (CLIA) / College of American

Pathologists (CAP) certified / research setting),

technology used (platform(s)/machine(s)),

depth of coverage (for whole genome and

whole exome sequencing) and associated test

report details.

l Customer Service: Understanding customer

service standards and access points (phone,

email, chat) for both the individual and the

physician.

Figure 1. Precision Medicine Implementation Lifecycle

Introduction &

EducationLimited AcceptanceLow UtilityHigh CostNo Reimbursement

Uti

lity

Time

Awareness &

UndestandingGrowing AcceptanceIncreasing UtilityHigh CostLimited Reimbursement

Awareness &

AdaptationHigh AcceptanceConstant UtilityReduced CostWide Reimbursement

Awareness &

AbandonmentDiminished AcceptanceDecreased UtilityConstant CostWide Reimbursement

Innovators Early Adaptors Majority Laggards

First MoverThreshold

Organizational Fit

To determine organizational fit between your

entity and that of the company providing DTC

or CD services – it encompasses how the

company aligns with your mission, vision,

business objectives, and overall strategy. This

step includes:

l Company Profile: Assembling a company

profile, incl. the type of entity you are evaluating

(for-profit vs. not-for-profit, mission/vision,

core values, etc.) and how it compares to your

purpose.

l Leadership: Reviewing the leadership team,

incl. the medical and research team, board

of directors, and advisory board (balance

between scientific, clinical, and business

experts is important), as well as the number

of staff employed, etc.

l Investments: Profiling the company’s

investors (if any) and the type of investments

made, incl. the amount and type. This history

is also crucial for assessing investment

potential (if applicable).

A B

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Figure 2. Direct-to-Consumer and Consumer-Directed

Product Assessment Framework

Categories Objectives Assessment Components

• Company Profile / Core Values

• Leadership Team

• Investments

• Legal/Government Regulations

• Media Coverage

• Marketing Plan

• Company Core Competencies

• Test Benefits & Target Markets

• Cost and Pricing Structure

• Technical Test Specifications

• Customer Service

• Company Fact Sheets

• Current Customers

• Data Sharing Models

• Report Templates & Integration

• Support Services

• Competition

• Research Projects

• Test Panel Composition

• Clinical Validity and Patient Benefits

• Research Application

• Physician Interaction

• Quality Controls

• Partnership Model

• Staffing Requirements

• Buy versus Make Decisions

• Electronic Health Record (EHR)

Integration

• Payment Terms

• Education & Training

• Product Modification / Enhancements

l Fact Sheets: Reviewing company fact sheets

(scientific and non-scientific).

l Customers: Researching company partners

and current customers.

l Data Sharing: Investigating data sharing

principles with the individual and physician

and in which format, incl. information shared

with individuals as part of coaching process.

l Reports: Reviewing report templates

and content, including support tools for

both the individual and physician, as well

as interpretation benchmarks.

l Support Programs: Evaluating existing health

coach or genetic counselor programs and

format thereof (face-to-face, group setting,

phone, email, video conference, etc.)

l Competition: Comparing product(s) to

other similar internal and or external products

available, incl. cost, list of genes and associated

reports, customer support services, etc.

l Research: Understanding whether or not

the data generated is used for research.

Clinical Validity and Physician Uptake

To clarify whether or not the product or

service has clinical validity (is evidence-based)

and to gauge physician acceptance. This step

includes:

l Test Panel Composition: Analyzing test

details, tests included and not included in an

assay and reasons for doing so.

l Clinical Validity: Establishing if test(s) are

based on evidence and have clinical validity

that can be supported by peer-reviewed

research studies, research data, publications,

etc., as well as assessing which patient/

consumer benefits are derived from offering

the test(s).

l Research: Determining whether or not

data is used for the company’s research

endeavors, and, if so, whether or not the

study has undergone International Review

Board (IRB) approval, incl. informed consent

forms used, research goals established, etc.

l Physician Interaction: Setting expectations

for physician interactions and requirements,

such as test ordering and report returns, as well

Organizational Fit To determine organizational fit between your entity and that of the company providing DTC or CD service – it encompasses how the company aligns with your mission, vision, business objectives, and overall strategy.

Product Overview To understand whichand Fact Gathering product(s) and service(s) the company is offering and associated customer group(s).

Clinical Validity and To clarify whether or not the Physician Uptake product or service has clinical validity (evidence-based) and to gauge physician acceptance, and benefits to patient care.

Business Approach To define the business model most appropriate for your provider(s).

as addressing how the use of the test will add

or reduce time spent on clinical workflows.

l Quality Controls: Agreeing on what quality

controls must be in place at both institutions.

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Business Approach

To define the business model most appropriate

for your provider(s). This step includes:

l Partnership Model: Negotiating partnership

details such as a pilot project and beta sites,

patient benefits for participation, cost and

profit sharing terms, volume discounts and

requirements, additional services provided as

part of the partnership agreement, distribution

channels (concierge medicine, employees,

insurance plan participants, all patients, etc.)

l Staffing: Understanding any additional

internal staffing requirements if any.

l Buy versus Make: Agreeing on which

laboratories will be used for which test

(internal/external) and environment (research

versus CLIA/CAP certified) and understanding

the impact on market share if any.

l Electronic Health Record (EHR) Integration:

Defining whether or not the platform used

by the company is compatible with your

Information Technology infrastructure and

whether or not one- or bi-directional data

sharing is permitted.

l Payment Terms*: Determining who pays for

test offering and through which channel – your

entity, the company (as a pilot project), the

individual, or the insurance plan*.

l Education & Training: Agreeing on which

entity is responsible for consumer education

and physician training. This includes an

evidence-based library, marketing materials,

and type of education channels (print, video, etc.)

l Product Modification / Enhancements:

Evaluating if product modifications or

enhancements are beneficial to the new

offering, e.g., your own organization’s

(add-on) services.

l Data Storage and Management: Facilitating

an agreement making determinations about

data sharing, research use of data and by which

parties, specific data access points, and the

responsible party for data storage and management.

l Intellectual Property: Understanding who

owns the rights (if not shared) to intellectual

property created as part of the business deal.

Workflow Integration

To determine how the new test or offering

will be integrated into any existing internal

processes and workflows. This step includes:

l Information Technology: Identifying any

requirements for technology integration and

interoperability, such as with an EHR, third

party billing system, laboratory reporting

platform, as well as data sharing structures,

ICD-10 medical necessity coding requirements

for reimbursement (if any) and the location

and management of these systems.

l Legal and Compliance: Following internal,

state, and federal regulations specific to your

company, as well as assessing other existing

partnership agreements and contingencies.

l Managed Care Contracting*: Understanding

any impact on existing managed care contracts

for medically indicated testing services similar

to the product being assessed.

l Marketing / Communications: Facilitating

an integrated marketing and communications

plan if needed.

l Pricing (Charge Master): Determining a price

for a product that has either been modified,

enhanced, or will be promoted and sold

directly by your entity.

l Laboratory Interface: Facilitating the

integration of internal laboratory services

into the new process, such as phlebotomy,

courier services, etc.

Franziska Moeckel, MBA. Franziska Moeckel is

the Assistant Vice President, Personalized Health

at Inova. In her role, Franziska is leading business

operations and product launch activities for molecular

diagnostic testing as part of an in-house, CLIA-certified

genomics laboratory, and is assessing and promoting

new ‘omics features for clinical practice, including

consumer-directed and direct-to-consumer products

and services.

As part of the new Inova Center for Personalized

Health team, she is providing strategic direction

and thought leadership around the integration of

precision medicine and individualized wellness.

“ Regardless of what the situation may be, providers have a choice to

make: to either participate and partner with patients and these

companies, to build their own version of DTC and CD offerings,

or to ignore this trend altogether.”

These steps are suggestions and may or may

not apply to your organization as DTC and

CD products evaluated may differ and as

company goals, management structure, as

well as overall sophistication levels and

technological integration requirements vary

from entity to entity.

*Generally, Managed Care Contracts and

insurance plans currently do not cover or

reimburse for Direct-to-Consumer (DTC)

or Consumer-Directed (CD) tests due to the

lack of medical necessity. However, a forward

looking approach has been taken in this

assessment and for this framework.