(Bloomberg) -- NantHealth Inc., a health-care company founded by the world’s richest doctor, has found a buyer of its pricey cancer test in Israel, helping NantHealth earn revenue as it struggles to sell the test in the U.S.
From last June to mid-April, the company was reimbursed for 110 of its GPS Cancer tests, according to spokeswoman Jen Hodson. Almost all of those payments -- 97 -- came through a reseller agreement with Oncotest-Teva, a unit of Teva Pharmaceutical Industries Ltd., according to Hodson. Eight were cash payments by patients, and five were paid for by U.S. insurers or employers.
It’s the first time NantHealth has released reimbursement data on its $11,000 GPS Cancer Test, which company founder Patrick Soon-Shiong calls the “nation’s first comprehensive molecular test of tumor and normal-tissue measuring.”
Hodson declined to say how many tests were ordered because the company hasn’t reported its first-quarter results yet. Lior Soussan-Gutman, managing director of Oncotest-Teva, confirmed that it makes payments to NantHealth upon order by a local doctor. Oncotest-Teva is then responsible for getting reimbursed by patients’ insurers or the patients themselves.
U.S. insurers have been slow to provide coverage for the genomic test. Though NantHealth has gotten a handful of insurers and employers to sign deals saying they will reimburse the cost, Bloomberg News reported April 24 that they’ve barely ordered any tests, suggesting that the company probably has been giving most of them away for free.
In its third and fourth quarter financial reports, NantHealth reported a combined 670 “commercial orders” for the tests in the second half of last year. Those numbers suggest a robust launch, but Bloomberg News, checking with each of the insurers that covers the test, found that six were ordered in the U.S., all from Sanford Health, a hospital system in the Dakotas.
NantHealth is still waiting to receive reimbursement from Sanford Health, according to Hodson. It isn’t clear how many of the other 664 ordered tests represent sales to Teva, orders to insurers yet to be reimbursed, or NantHealth give-aways directly to doctors and hospitals to promote the test.
Soon-Shiong says the $11,000 list price, almost double the price of other tests on the market, is justified because it provides far more information than the other tests. While he has an ambitious vision of conquering cancer, he’s also been a controversial figure, with recent media reports detailing questionable methods for promoting his businesses. Some investors are losing confidence, driving down NantHealth shares 68 percent since the beginning of the year.
NantHealth reported $100.4 million in 2016 revenue but didn’t break out how much came from the diagnostic tests. The company also sells various software services to payers and hospitals.