Biodesix execs discuss company’s first major acquisition, Indi

BOULDER — Biodesix Inc., a Boulder-based biotech firm specializing in blood-based diagnostic tests for lung-disease patients, has acquired Seattle-based Integrated Diagnostics Inc., also known as Indi.

Biodesix, which has offices in Boulder and Steamboat Springs, makes tests that can help physicians determine how a patient will respond to certain lung disease treatment options, given certain protein-based and genomics-based

signalers in their bloodstream. Indi makes another blood-based diagnostics test in the lung-disease space: a test that can help identify whether a mass on the lung is not cancer without requiring a biopsy.

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BizWest sat down with some of Biodesix’s leadership staff to discuss the company’s first major acquisition, what Theranos has meant for blood-based diagnostic companies and what diagnostics can mean for lung-disease patients.

What does Biodesix do?

Robin Harper Cowie, chief financial officer: We have made diagnostics tests for lung disease. Lung disease is complicated and requires difficult decisions. We started with a single test, VeriStrat, a protein-based test that assesses how a patient is doing with treatment and treatment strategies. We’ve since added a genomics-based test, GeneStrat, because doctors need to be able to understand both sides of what’s happening. The genomics test helps understand what is going on in a tumor, and the protein test understands a patient’s immune system. Those blood-based tests are administered by a doctor and then shipped to our lab. We can then get results in less than 72 hours. Because when it comes to lung cancer, time is of the essence. Lung cancer can be a dire diagnosis, with the median survival rate 12 to 14 months.

How can you do it so quickly?

Harper Cowie: We have great technology. We say we’re multi-omic. You’ll hear of companies that are genomic or proteomic. Some companies are so focused on their one technology. But we have multiple technologies we use depending on the issue. We look at the clinical question of what do we need to answer and then we find the best technology for that and bring it on.

Why lung cancer?

Harper Cowie: Our founders have been using machine learning since before there was that buzzword for it. One of our founders was asked by researchers to answer questions in lung cancer and we’ve just continued in that space. It’s the second-largest cancer and the first killer. Physicians and patients need help.

When people think of blood-based diagnostics, a lot of them will first think of Theranos and that catastrophe. How do you differ?

Harper Cowie: Theranos was working on a little box that could be dropped into every lab, CVS, Walgreens that would take a quick blood prick and then spit out all these different results. We don’t do devices. People do a draw and then send it here. We have a lot of very big equipment we’re using. I think what differentiates us — and other companies in this space — from Theranos is our commitment to publishing clinical data. We’ve done studies that understand our tests’ impact on patients and have published peer-reviewed data. We’ve also registered with all the significant regulators. There’s a commitment to quality here. And we continue to study our tests and how they impact payers, physicians and patients. We’re focused on getting the right patient the right medicine.

Scott Hutton, chief operating officer: We’re also agnostic to any drugs on the market.

Harper Cowie: But we welcome question on Theranos and the gene space. They’ve been a black eye. We think having a dialogue about it is the best possible way to move forward.

Hutton: And Theranos hasn’t changed the demand or need from physicians for guidance.

Can you tell me more about what exactly you’re testing for in these studies. Since you’re not a pharmaceutical company making treatments, I’m guessing it’s not the efficacy of the drugs, since you don’t make any.

Linda Traylor, vice president of scientific and medical affairs: VeriStrat has an ongoing registry of 2,000 patients evaluated. What we’re assessing is our utility by physicians in the ever-changing treatment landscape. We’re looking at the ways the information our tests provide affects the treatment decisions of patients and physicians.

Hutton: Treatments are ever changing, we’re giving them critical information they need.

Paul Beresford, chief business officer: This is an exciting time in the industry. There are a lot of new immunotherapy treatments for lung cancer that we are partnering up with. Our diagnostic tests are detecting the underlying signals in a patient’s blood that can indicate how a patient will react to a drug. So our studies map a profile of patients, have them go through a clinical trial with a drug we partner with and then see hour the patient profiles compare to results and what indicators line up with reactions to treatments.

Tell me about Indi and this acquisition.

Harper Cowie: We’ve been aware of Indi for a number of years. The lung diagnostics company world is small and we all know each other. They have made a great test, called XL2. What often happens is, if a patient goes into the doctor and they see a mass on the lung, the question is whether to biopsy it or not. If there’s just a small spot on the lung, the doctor is usually comfortable with just watching it. If there’s a huge mass, they’re going to biopsy it because it is likely something serious. But there’s a question about what to do if a mass is sort of in-between those two choices. Doctors often default to getting it biopsied. But this patient group often has other health issues and the biopsy process is invasive. They usually go in-between the ribs with a large needle, that can often collapse the lung, or they go down the throat, but that can be difficult to get a sample of the mass and sometimes needs to be done multiple times. It’s invasive and the cost to the healthcare system is enormous, especially when it turns out to be benign. The XL2 test is a blood draw that uses machine learning to identify is a mass is benign without a biopsy. And it is very good at identifying that something is not cancer. If the test says it’s not cancer, you can feel good about that.

Hutton: And doctors will still monitor it.

But why acquire Indi? Why not just partner with them?

Harper Cowie: Commercializing tests is hard. We already have the infrastructure for it. We’re able to leverage what we already have. And by bringing them on, we can provide answers to questions our customers were already asking. Indi has had great validation of the XL2 test. By acquiring them, we can get this out to patients quickly. They’re a small company, about 10 employees, that has been focused on validating the test. And after that they would launch.

Hutton: They would have had to build out significantly.

Harper Cowie: Our combination made a lot of sense. We’ll be bringing over pretty much everyone except for their CEO and CFO.

Hutton: And we’ll be keeping their lab in Seattle intact. We’ll now operate out of Steamboat Springs, Boulder and Seattle.

What comes next?

Harper Cowie: We’ve already started the transition. XL2 is slated to have a limited release during the fourth quarter and we’ll expand that in 2019.

Hutton: To be a blood-based diagnostic company in the lung space with three tests is rare.

If you now have offices on the coast in Seattle, why keep your headquarters in Boulder?

Harper Cowie: Boulder is a great area for biotech. Having the university here is wonderful and there are a lot of other lab companies here. We’re not Silicon Valley or Boston, yet. But Colorado is up and coming. There’s tremendous talent and support.

Editor’s note: This interview was edited and condensed.