Overcoming regulatory and economic challenges facing pharmacogenomics.

The number of personalized medicines and companion diagnostics in use in the United States has gradually increased over the past decade, from a handful of medicines and tests in 2001 to several dozen in 2011. However, the numbers have not reached the potential hoped for when the human genome project was completed in 2001. Significant clinical, regulatory, and economic barriers exist and persist. From a regulatory perspective, therapeutics and companion diagnostics are ideally developed simultaneously, with the clinical significance of the diagnostic established using data from the clinical development program of the corresponding therapeutic. Nevertheless, this is not (yet) happening. Most personalized medicines are personalized post hoc, that is, a companion diagnostic is developed separately and approved after the therapeutic. This is due in part to a separate and more complex regulatory process for diagnostics coupled with a lack of clear regulatory guidance. More importantly, payers have placed restrictions on reimbursement of personalized medicines and their companion diagnostics, given the lack of evidence on the clinical utility of many tests. To achieve increased clinical adoption of diagnostics and targeted therapies through more favorable reimbursement and incorporation in clinical practice guidelines, regulators will need to provide unambiguous guidance and manufacturers will need to bring more and better clinical evidence to the market place.