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Cologuard, made by Exact Sciences, sponsored a golf tournament this year. Photo: Darren Carroll/Getty Images

Exact Sciences, maker of the colon cancer test Cologuard, has signed a multimillion deal with drug giant Pfizer to increase and share in the costs of marketing the test — a move Wall Street cheered yesterday.

The bottom line: Physicians and other medical professionals should be ready for an onslaught of calls and face-to-face pitches from the companies' sales armies, even though there is evidence the costly Cologuard test can lead to false positives.

The big picture: This marketing blitz inevitably will push more people to get checked for colon cancer, which public health experts say is a good thing. Colon cancer is the second-leading cause of cancer death in the U.S.

But experts also say it will come at a steep price with potentially harmful and wasteful care.

  • A doctor must prescribe Cologuard, an FDA-approved home kit where people mail their stool to a lab for DNA testing.
  • Medicare pays $509 for Cologuard. Most other commercial health insurers cover it, and likely pay more than Medicare.
  • The U.S. Preventive Services Task Force says Cologuard is acceptable for colon cancer screening. But when compared with cheaper tests, Cologuard was tied to "more false-positive results, more diagnostic colonoscopies, and more associated adverse events per screening test," and it "may potentially lead to overly intensive surveillance," according to the USPSTF.
  • "Worried patients and/or providers may feel obligated to order additional tests — which could be imaging or invasive — to determine whether there could be a cancer elsewhere in the body, thus potentially adding to the costs and risks of Cologuard screening," Richard Hoffman, a professor of internal medicine and epidemiology at the University of Iowa, said in an email.
  • An Exact Sciences spokesperson referred to a company-funded study on why it believes Cologuard is better than other tests.

By the numbers: The financial terms of the agreement are lucrative for both sides.

  • Pfizer will spend nearly $70 million in Cologuard marketing and promotion from October through the end of 2021.
  • Exact Sciences will maintain its baseline marketing spend of at least $80 million per year and match Pfizer's additional spending.
  • Any profits that are earned over certain Cologuard revenue thresholds will be split 50-50, and Pfizer can get a royalty of up to 3% of Cologuard sales for three years after the deal ends in 2021.
  • A Pfizer executive told investors it made the deal because it had a sales team for Lyrica, a drug that is losing market exclusivity, that could shift to Cologuard instead.
  • Exact Sciences expects to bring in at least $1.2 billion in Cologuard revenue by 2021.
  • CEO Kevin Conroy made almost $50 million over the past three years, including $32.3 million in 2017.

Go deeper

Mike Allen, author of AM
43 mins ago - Economy & Business

America on borrowed time

Illustration: Aïda Amer/Axios

Economic recovery will not be linear as the world continues to grapple with the uncertainty of the pandemic.

Why it matters: Despite being propped up by an extraordinary amount of fiscal stimulus and support from central banks, the state of the global economy remains fragile.

Scoop: Gina Haspel threatened to resign over plan to install Kash Patel as CIA deputy

CIA Director Gina Haspel. Photo: Win McNamee/Getty Images

CIA Director Gina Haspel threatened to resign in early December after President Trump cooked up a hasty plan to install loyalist Kash Patel, a former aide to Rep. Devin Nunes (R-Calif.), as her deputy, according to three senior administration officials with direct knowledge of the matter.

Why it matters: The revelation stunned national security officials and almost blew up the leadership of the world's most powerful spy agency. Only a series of coincidences — and last minute interventions from Vice President Mike Pence and White House counsel Pat Cipollone — stopped it.

Updated 13 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Coronavirus deaths reach 4,000 per day as hospitals remain in crisis mode — CDC warns highly transmissible coronavirus variant could become dominant in U.S. in March.
  2. Politics: Biden says, "We will manage the hell out of" vaccine distribution — Biden taps ex-FDA chief to lead Operation Warp Speed amid rollout of COVID plan — Widow of GOP congressman-elect who died of COVID-19 will run to fill his seat.
  3. Vaccine: Battling Black mistrust of the vaccines"Pharmacy deserts" could become vaccine deserts — Instacart to give $25 to shoppers who get vaccine.
  4. Economy: Unemployment filings explode againFed chair: No interest rate hike coming any time soon —  Inflation rose more than expected in December.
  5. World: WHO team arrives in China to investigate pandemic origins.