Dermtech Offers A Simple Way to Detect Melanoma
The skin is the largest organ of the body, and therefore not surprisingly, skin cancer is the most common of all cancers accounting for nearly half of all cancers in the United States. Skin cancers can be cured easily if they are found early on. The problem is that they cannot be diagnosed visually as the below example shows:
Since visual diagnosis is not an option to test for skin cancer, a biopsy would need to be performed instead. A shave, punch or excision of the skin is needed, and these invasive methods are painful and can result in complications such as scarring. The process is not appealing to patients and therefore they are not likely to ask for a biopsy for every suspicious skin pigment change on their bodies. One company, Dermtech, is looking to provide patients with a quick and painless way to diagnose skin cancer with perfect accuracy using adhesive tape.
San Diego-based Dermtech was founded in 1996 and according to Crunchbase has taken in $22.4 million in funding so far. In 2007 the Company adopted a new strategy to focus on PCR assays that can be used to detect skin cancer. Gentherm filed for an IPO in May of this year and is presently looking to raise $15 million from the offering. As of June 30, 2014, Dermtech had an accumulated deficit of $40.6 million had not yet received any revenues from sales of their test products.
The Dermtech Melanoma Test
Dermtech’s initial test, the Pigmented Lesion Assay, detects melanoma. While melanoma accounts for only a small percentage of skin cancers, it is far more aggressive than other skin cancers and causes 75% of skin cancer deaths. Instead of using a biopsy, the Dermtech test uses an adhesive patch with a proprietary process that allows then to extract RNA from the patch using a gene expression analysis that can detect cancerous cells. The procedure is performed using the below steps:
The test detects melanoma 100 percent of the time, with 12 percent false positives. This is much more appealing to a patient than a test with a likelihood of a false negative. The test will be introduced in the second half of 2014 and will be marketed directly to a concentrated group of 250 to 500 dermatologists that treat a majority of the 750,000 patients with the highest risk of melanoma in the United States. Dermtech has protected their technology with five issued U.S. patents, of which two are broadly directed to the use of an adhesive to collect samples containing RNA from the skin for analysis. According to an interview with 10 News, DermTech CEO George Schwartz expects sales of the test in the high-risk population in the U.S. to exceed $1 billion a year. Revenue growth will be a key metric to watch going forward as it will be a proxy for how well the product is being adopted as a result of the Company’s direct marketing efforts.
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