Freenome has entered an exclusive licence agreement with Exact Sciences, granting the latter the rights to commercialise Freenome’s blood-based colorectal cancer (CRC) screening test in the US.
Exact Sciences plans to accelerate the market adoption of the CRC blood test by leveraging its commercial infrastructure.
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Under the agreement, Exact Sciences will pay Freenome an upfront cash payment of $75m that is payable by this November.
Freenome is set to receive up to an additional $700m, contingent upon reaching specific milestones related to its CRC screening tests.
These milestones include a $100m payment upon receiving first-line approval from the Food and Drug Administration (FDA) for their inaugural test and another $100m for the approval of a subsequent, next-generation test that meets or exceeds certain performance criteria, such as a minimum of 19% advanced precancerous lesions (APL) sensitivity and 83% overall CRC sensitivity.
However, should the performance fall below these benchmarks, the payment would be adjusted accordingly.
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By GlobalDataFurthermore, Freenome could earn $500m if its test is classified as a first-line A or B test in the US Preventive Services Taskforce (USPSTF) guidelines or if it achieves certain payer-contracted coverage requirements.
Again, a decreased payment is applicable if the test is included in the USPSTF guidelines as a second-line A or B test.
Freenome could be entitled to obtain royalties that vary between 0% and 10%, depending on the profitability of the test, while also adhering to standard provisions for royalty stacking. However, if specific conditions are not fulfilled, Exact Sciences reserves the right to end the agreement.
Exact Sciences noted that it is committed to investing $20m annually over three years in joint research and development to further utilise the technology.
Freenome retains rights to its CRC blood test when combined with other cancer screening tests.
The license agreement also includes a senior convertible note purchase by Exact Sciences, amounting to $50m, with a coupon rate of 5% due in 2030.
Freenome’s PREEMPT CRC Study, which involved nearly 49,000 adults at average risk, demonstrated the CRC test’s ability to identify 81.1% of CRC, including 63.5% at stage one, and 13.7% of APL, with a specificity of 90.4%.
Freenome is also working on an “improved version” of the test, which has shown enhanced performance in detection rates, and plans to submit a supplemental premarket approval application to the FDA once final clinical validation data are available.
In a recent development, Exact Sciences expanded its collaboration with private insurer Humana to make the Cologuard Plus test available to eligible Humana Medicare Advantage members as an in-network service across the US.
