This Medicare contractor will provide limited coverage for the (BDX-XL2) test
(Biodesix, Boulder, CO and Seattle, WA) for the management of a lung nodule,
between 8 and 30mm in diameter, in patients 40 years or older, and with a pre-
test cancer risk (as assessed by the Mayo Clinic Model for Solitary Pulmonary
Nodules) of 50% or less. The intended use of the test is to assist physicians
in the management of lung nodules by identifying those lung nodules with a
high probability of being benign. These lung nodules would then be candidates
for non-invasive computed tomography (CT) surveillance instead of invasive
procedures.

Lung nodules are rounded densities, under 30mm in diameter, detected by chest
radiograph (CXR) or CT scan. Nodules are mostly surrounded by lung tissue and
are also called coin lesions, solitary pulmonary nodules or lesions, or a
"spot" on the lung. The edges of a nodule can be described as smooth or
irregular (stellate or spiculated) with irregular edges somewhat more
indicative for cancer. Heavily calcified nodules with smooth edges are
generally benign and solid nodules that have not shown growth over time are
considered benign. For a comprehensive review of nodules and their evaluation,
see the 2-part series by Patel, et al.1,2

Lung nodules are detected incidentally or through lung cancer screening. Lung
cancer screening now has Medicare coverage in the United States (US). As of
April 26, 2016, there were 806 sites registered for screening.22 The estimated
number of new lung nodules incidentally detected annually in the US is 1.57
million, whereas it is anticipated that another 1.5 million are detected by
screening annually in the US.3

Early detection of lung nodules is an opportunity to reduce lung cancer
mortality, but it comes with significant risks. These risks are both for
patients and health care delivery networks. For patients, a major problem is
the risk of unnecessary invasive procedures to find the minority of nodules
that are cancer. For health care delivery, the risks are both costs and
overloading the health care system.

Of the expected 3 million nodules per year found incidentally or by lung
cancer screening, the majority will be Medicare age. Four recent studies
underscore the importance of lung cancer evaluations to the Medicare
population:

  * The mean age of 377 eligible patients in an 18-site retrospective chart review study was 65.4
  * A prospective study across 12 sites and 475 patients found 62.5% of patients were 65 years of age or older.5
  * A recent study reported that between Jan 2009 and Dec 2011, 8,979 Medicare patients from a random sampling of 5% of Medicare claims, underwent lung cancer evaluations because of an abnormal chest CT scan.6
  * In the National Lung Screening Trial (NLST), over 57% of enrollees were over 65 years of age.7 Also, the rates of nodule detection increased dramatically with age.3 Medicare enrollees are more likely to meet lung cancer screening criteria and have more nodules detected.

A set of guidelines for lung nodule management is published and updated by the
American College of Chest Physicians (ACCP). The ACCP guidelines for lung
nodules, updated in 2013, is the primary reference used by pulmonologists in
the US.8 The ACCP Guidelines state: "Although clinical and radiographic [CT
scans] characteristics cannot reliably distinguish between benign and
malignant nodules in most individuals, it is nevertheless important to
estimate the clinical probability of malignancy before ordering imaging tests
or biopsy procedures". The pretest probability of malignancy (pCA) is
estimated by using clinical judgment or with a quantitative risk model.9,10
Establishing a pCA creates 3 risk stratification groups, namely, Low,
Intermediate, and High probability, with Low risk having pCA below 5% and High
risk having pCA above 65%. The general concept is that Low risk patients will
be observed with CT surveillance to watch for growth if a nodule is malignant.
Conversely, the guidelines suggest those patients in the High-risk group go
directly to surgery. The logic is that the probability of cancer is high
enough that a negative biopsy will not change the care pathway. The
Intermediate risk group (5-65% pCA) are recommended to enter the diagnostic
odyssey that often includes positron emission tomography (PET) scanning as the
next step. A negative PET suggests a benign nodule, so the patient is followed
with CT scans. A positive PET scan goes on to surgery or biopsy. This is the
overall concept, but PET has sensitivity and specificity challenges. In
particular, current estimates of PET sensitivity from 72% to 94% are reviewed
in the 2013 ACCP Guidelines in section 4.2.3.8 False positive PET scans for
nodules are an additional problem with estimates of the false positive PET
scan rate of 39%.4

A pulmonary community practice observational chart review of 18 practices and
377 patients found a wide variation in management of nodules.4 The surgery
rate for benign nodules was 35%, and the rate of surgery was the same for Low,
Intermediate, and High risk patients. The risk categories were calculated by
the study and despite a Low risk, 28% had biopsies and 17% had surgery. The
rates of surgery for benign nodules range between 10% and 55%. A survey of 196
pulmonologists supports the potential of a non-invasive biomarker to
positively improve lung nodule management decisions.11

Biopsies can be obtained through a bronchoscope, or a needle passed through
the chest wall with CT image guidance. A community practice chart review found
38% of patients had a form of biopsy.4 Complications with biopsies or surgery
are increased with age, smoking history, and other lung disease. Biopsy
through the bronchoscope has the lowest risk with a 2-4% risk of bleeding or
pneumothorax.8 A disadvantage of this procedure is inaccurate sampling of the
nodule. Correct sampling averages about 50%.8 The correct sampling rate may
improve with modern navigation techniques that are being adopted.
Bronchoscopic biopsy use for nodules is currently about 20% of nodules.6
Needle biopsies are done in about 15% of patients with nodules with a 1% risk
of bleeding, and a 15-19% risk of pneumothorax.12 About half (7%) of patients
with a pneumothorax require chest tube placement with a significant period of
hospitalization.12 Most needle biopsies are diagnostic, but the risk of a non-
diagnostic result with a malignant nodule is about 20%.8 Biopsies (combined
bronchoscopy and needle) are performed in about 25% of nodules (200,000), and
the procedures are for benign nodules in 42-62% (104,000). Complications from
biopsies result in hospitalization in 2-7% of cases.6,12 That translates into
4,680 excess hospitalizations per year that are potentially avoidable.

Eventually, most malignant nodules go to surgery for resection and about
15-25% of patients have biopsy attempts before surgery. The overall surgery
rate is about 34% (270,000 per year) for benign and malignant nodules in the
nodule population.4 Complications include death (2% in Medicare population),13
prolonged lung air leak (3-5%), and pneumonia (1-8%).8 Published rates for
surgery for benign nodules range from 31-44%.4,7,17 This translates into an
estimated 102,000 surgeries and 2,052 deaths per year that are avoidable for
patients that do not have lung cancer.

**Test Description and Intended Use**  
BDX-XL2 is a proteomic risk predictor that integrates the expression levels of
2 proteins with 5 clinical risk factors. The BDX-XL2 assay is performed on
fresh-frozen EDTA plasma samples using mass spectrometry.15,16 Results are
reported as "Likely Benign" when the post-test probability that a lung nodule
is benign is 90% or higher. Otherwise, the test reports "Indeterminate" when
the post-test probability is less than 90%. "Likely Benign" test reports also
include the post-test probability that the lung nodule is benign, ranging from
90% to 98%. This is further detailed in Table 1 below, along with the
performance of the test at each post-test probability.

The intended use of the test is to assist physicians in the management of lung
nodules by identifying those lung nodules with a high post-test probability of
being benign. These lung nodules would then be candidates for non-invasive CT
surveillance instead of invasive diagnostic procedures such as biopsy or
surgery.

**Clinical Validation**  
The discovery, clinical validation, and analytical performance of earlier
versions of the assay were previously reported.15-17 The current version of
(BDX-XL2) is a refinement that incorporates clinical risk factors (nodule
size, age, smoking history, nodule location, and nodule spiculation). BDX-XL2
was retrospectively validated on the prospective observational PANOPTIC study
(NCT01752114) of lung nodule management. PANOPTIC enrolled 685 subjects across
33 sites in the US and Canada. Validation of BDX-XL2 followed the National
Academy of Medicine's guidelines for rigorous test development.18

In the PANOPTIC study, 178 subjects met the intended use population of BDX-
XL2. This consisted of 149 benign lung nodules (as determined by
histopathology after biopsy or surgery, or by stable CT surveillance of a lung
nodule after at least 1 year) and 29 malignant lung nodules (as determined by
histopathology after biopsy or surgery), yielding a cancer prevalence of
16.3%. Per protocol, this cohort of patients was split into separate
verification (n = 69) and validation (n = 109) subsets, with pre-specified
interim and final analyses on each subset, respectively, to determine the
performance characteristics of the test. Since the test system and clinical
endpoints were unchanged between the interim and final analyses, all analyses
were blinded, and the 2 patient cohorts were mutually exclusive; the 69 and
109 patients are combined below.

For these 178 subjects, BDX- XL2 yielded a sensitivity, specificity, negative
predictive value (NPV) and positive predictive value (PPV) of 97% (CI:
82%-100%), 44% (CI: 36%-52%), 98% (CI: 92%-100%), and 25% (CI: 17%-34%),
respectively. We note that the post-test probability of BDX-XL2 is equivalent
to its NPV.

Procedure use and clinical factors were collected in the PANOPTIC study
permitting the comparison of BDX-XL2 performance to:

  * current practice, as characterized by physician pre-test risk assessment, denoted as pCA, which is based on the physician's clinical assessment of risk using a clinical risk model, and/or clinical judgement,
  * PET, and
  * clinical risk factor models including the 'Mayo', 'VA', 'Brock', and 'Herder' models (9, 10, 19, 20).

Using area under the curve (AUC) as a general performance measure, the
respective AUCs for XL2, pCA, PET, and these 4 clinical factor models were:
76% (CI: 69%-82%), 69% (CI: 62% - 76%), 58% (CI: 46%-69%), 69% (CI: 62%-76%),
60% (CI: 53%-67%), 71% (CI: 63%-77%), and 67% (CI: 56%-78%). BDX-XL2 had
statistically significant improved performance over all above diagnostic
modalities with p-values 2.1xE-11 (pCA), 0.001 (PET), 0.0009 (Mayo), 2.7xE-7
(VA), 0.005 (Brock) and 0.02 (Herder).

**Clinical Utility**  
Current practice has been previously characterized,4,11 as well as, the
potential clinical utility of an earlier version.5 The clinical utility of
BDX-XL2 is measured in terms of its potential to reduce unnecessary invasive
procedures, such as biopsies and surgeries, on benign lung nodules while not
significantly increasing the number of malignant lung nodules routed to CT
surveillance, thereby delaying surgical resection. Assuming strict adherence
to management recommendations based on assay results (i.e., active
surveillance if "likely benign"), an earlier version of Xpresys Lung
demonstrated a potential 32% reduction in invasive procedures on benign lung
nodules without increasing the number of malignant nodules routed to CT
surveillance5 based on a retrospective analysis of a prospective observational
study of lung nodule management (NCT01752101). Similarly, in the PANOPTIC
study, the potential clinical utility of the current version of (BDX-XL2) was
assessed retrospectively. Specifically, if BDX-XL2 were used to guide lung
management (and assuming a post-test probability of 98%), then invasive
procedures on benign lung nodules would have been reduced 36% (CI: 22%-52%)
with only 3% (CI: 0%-18%) of malignant nodules routed to CT surveillance
(compared to 45% with current practice in the PANOPTIC study).

**Summary of Analytical and Clinical Performance**  
 **General**

Intended Use | BDX-XL2 is intended for the evaluation of 8-30 mm lung nodules
in patients 40 years or older with a pre-test cancer risk (as assessed by the
Mayo Clinic Model for Solitary Pulmonary Nodules) of 50% or less.  
---|---  
Validated Specimen Type(s) | Plasma from K2 EDTA vacutainer tubes  
  


**Analytical Performance**

**Description** | **Results  
(with 95% Confidence Intervals if applicable)**  
---|---  
  
Repeatability (within run precision)

8 samples tested 3 times within a run, 1 instrument, 2 operators, 3 runs, 3
non-consecutive days, 1 manufacturing reagent lot for critical reagents.
Qualitative results represent only 2 possible final results (i.e.,
indeterminate and likely benign) with post-test probabilities for the latter
from 90 to 98%

| Analytes (analytical repeatability):  
ARRLG3BP CV = 7.0% (3.6%-10.3%)  
ARRC163A CV = 5.9% (3.6%-8.2%)  
  
Score (analytical repeatability):  
Score CV = 9.0% (3.4%-14.6%)  
  
Qualitative (clinical concordance):  
62.5% (5/8; 24.5%-91.5%)  
  
ARR is defined as the ratio between the peak area for the endogenous
quantifier peak and the peak area of the corresponding SIS peptide, multiplied
by a calibration factor that is specific for each SIS lot.  
  
Score is defined as Log2[ARRLG3BP/ ARRC163A]  
Intermediate precision (between run precision)  
  
7 samples tested once in 3 different runs, 1 instrument, 2 operators, 3 runs,
3 non-consecutive days, 1 manufacturing reagent lot for critical reagents.
Qualitative results represent only 2 possible final results (i.e.,
indeterminate and likely benign) with post-test probabilities for the latter
from 90 to 98%. | Analytes (analytical repeatability):  
ARRLG3BP CV = 14.5% (10.1%-18.9%)  
ARRC163A CV = 12.8% (9.1%-16.6%)  
  
Score (analytical repeatability):  
Score CV = 6.0% (3.7%-8.4%)  
  
Qualitative (clinical concordance):  
85.7% (6/7; 42.1%-99.6%)  
Reproducibility (between sites) | Not applicable  
Minimum input quantity | 20 L plasma  
Limit of blank (LOB) | Defined as the upper 99.5% confidence interval (CI) for
the response ratio (ARR) observed in negative controls.  
Limit of detection (LOD) | The lower limit of response for each analyte in
samples and positive controls is defined as the lower limit of quantification.  
Limits of quantitation (LOQ) | The lower limit of quantification (LLOQ) is
defined as the lowest response ratio within the linear range where the
coefficient of variation (CV) was equal to or below 0.20, where linearity was
established using 5 replicate measures at each concentration.  
  
The upper limit of quantification (ULOQ) is defined as the highest response
ratio within the linear range where the coefficient of variation (CV) was
equal to or below 0.20, where linearity was established using 5 replicate
measures at each concentration.  
  
LG3BP:  
ULOQ = 42  
LLOQ = 0.043  
  
C163A:  
ULOQ = 71  
LLOQ = 0.053  
Linearity | Not applicable for qualitative interpretation (i.e., likely benign
or indeterminate)  
For individual analytes, the linear response range was established between the
LLOQ and ULOQ  
Interfering substances | Visual inspection to detect hemolysis (100 mg/dL of
hemoglobin rejected).  
  
MRM-MS chromatograms for each analyte in every sample are inspected for
interference, with any interference resulting in QC failure.  
Specimen stability, primary (EDTA whole blood) | 3 hours at 2-8 C based on
validation study (manuscript in preparation)  
Specimen stability, intermediate (plasma) | 24 months at -70 C based on
validation study (manuscript in preparation)  
  
2 freeze-thaw cycles when stored at -70 C based on validation study
(manuscript in preparation)  
Reagent closed/shelf-life stability | 24 months at -70 C for 2 critical
reagents (i.e., Human Plasma Samples (HPS) and SIS peptides). ARR for 623
samples evaluated with slope not significantly different from zero (p = 0.77).  
  
Non-critical (general purpose) reagents are stored and expired per
manufacturer recommendations.  
Reagent open/in use stability | Critical reagents: Not applicable since single
use aliquots  
  
Non-critical reagents are stored and expired per manufacturer recommendations.  
  


**Clinical Performance: Validity**  
BDX-XL2 integrates the relative abundance of 2 plasma proteins (LG3BP and
C163A) with 5 clinical risk factors (age, smoking status, nodule diameter,
nodule spiculation status and nodule location). From these 7 markers, a
numerical value, _XL_2(k)_ , for a patient k, is calculated.

_XL_2(k)_ ranges between 0 and 1 and its value is used to index the post-test
probability (i.e., NPV) validated in the PANOPTIC study (see Table 1 below).

Table 1: XL2 Performance and Test Reporting (n= 178 subjects).

**XL_2(k)Value** | **Post-Test  
Benign  
Probability  
(i.e. NPV)  
(95% CI)** | **Sensitivity  
(95% CI)** | **Specificity  
(95% CI)** | **PPV  
(95% CI)** | **Test  
Report**  
---|---|---|---|---|---  
0 to 0.131 | 98%  
(92% - 100%) | 97%  
(82% - 100%) | 44%  
(36% - 52%) | 25%  
(17% - 34%) | Likely Benign  
>0.131 to 0.1613 | 97%  
(91% - 100%) | 93%  
(77% - 99%) | 49%  
(41% - 57%) | 26%  
(18% - 36%) | Likely Benign  
0.1613 to 0.172 | 96%  
(90% - 99%) | 90%  
(73% - 98%) | 54%  
(45% - 62%) | 27%  
(19% - 37%) | Likely Benign  
>0.172 to 0.176 | 95%  
(89% - 99%) | 86%  
(68% - 96%) | 55%  
(47% - 63%) | 27%  
(18% - 37%) | Likely Benign  
>0.176 to 0.1785 | 94%  
(87% - 98%) | 83%  
(64% - 94%) | 56%  
(47% - 64%) | 27%  
(18% - 37%) | Likely Benign  
>0.1785 to 0.193 | 93%  
(86% - 98%) | 79%  
(60% - 92%) | 57%  
(44% - 65%) | 26%  
(18% - 37%) | Likely Benign  
>0.193 to 0.195 | 92%  
(85% - 96%) | 76%  
(56% - 90%) | 58%  
(49% - 66%) | 26%  
(17% - 37%) | Likely Benign  
>0.195 to 0.2306 | 91%  
(84% - 96%) | 69%  
(49% - 85%) | 64%  
(56% - 72%) | 27%  
(18% - 39%) | Likely Benign  
>0.2306 to 0.354 | 90%  
(84% - 95%) | 55%  
(36% - 74%) | 83%  
(75% - 88%) | 38%  
(24% - 54%) | Likely Benign  
>0.354 | - | - | - | - | Indeterminat  
  


**Clinical Performance: Utility**  
PANOPTIC was a non-interventional study; however, the potential clinical
utility of BDX-XL2 can be estimated by evaluating how many benign (benefit)
and malignant (harm) nodules would have been routed away from invasive
procedures into CT surveillance if BDX-XL2 had been used to guide patient
management in the study (and assuming complete compliance). Table 2 summarizes
the potential clinical utility of BDX-XL2 at each post-test probability.

Table 2: Potential Clinical Utility of BDX-XL2v

**Post-Test  
Probability  
of Being Benign** | **Reduction in Invasive Procedures  
of Benign Nodules  
(95% CI)** | **Malignant Nodules Sent to  
CT Surveillance  
(95% CI)**  
---|---|---  
98% | 15/42 = 36%  
(22% - 52%) | 1/29 = 3%  
(0% -18%)  
97% | 17/42 = 40%  
(26% - 57%) | 2/29 = 7%  
(1% -23%)  
96% | 19/42 = 45%  
(30% - 61%) | 2/29 = 7%  
(1% -23%)  
95% | 20/42 = 48%  
(32% - 64%) | 2/29 = 7%  
(1% -23%)  
94% | 20/42 = 48%  
(32% - 64%) | 2/29 = 7%  
(1% -23%)  
93% | 22/42 = 52%  
(36% - 68%) | 3/29 = 10%  
(2% -27%)  
92% | 22/42 = 52%  
(36% - 68%) | 4/29 = 14%  
(4% -32%)  
91% | 25/42 = 60%  
(43% - 74%) | 4/29 = 14%  
(4% -32%)  
90% | 32/42 = 76%  
(61% - 88%) | 7/29 = 24%  
(10% -44%)  
  


In the PANOPTIC study, there were 178 intended use subjects (when the
verification and validation sets are combined) of whom 29 had malignant lung
nodules and 149 had benign lung nodules. Of the 149 benign lung nodules, 42
had at least 1 invasive procedure. Hence the denominator of "42" in column 2
of Table 2. Of the 29 malignant lung nodules, 13 were routed to CT
surveillance. That is, 13/29 = 45% of malignant nodules were routed to CT
surveillance in PANOPTIC. This is substantially larger than the largest
corresponding value in Table 2 (i.e., 24%).

**Coverage Summary**  
The BDX-XL2 assay is reasonable and necessary to assist physicians in the
management of lung nodules by identifying those lung nodules with a high
probability of being benign. This assay is only covered when the following
conditions are met:

  * Patient is at least 40 years of age and has a lung nodule of diameter 8 to 30mm, and
  * The pre-test risk of cancer as determined by the Mayo risk prediction algorithm (10) is 50% or less

Note: The BDX-XL2 test should not be ordered if a physician does not intend to
act upon the test result. It is expected that physicians will advise nodule
surveillance for at least 80% of patients with a post-test probability of 98%
or higher.

Level of evidence

Quality - Moderate  
Strength - Moderate  
Weight - Limited

This contractor recognizes that evidence of clinical utility for the (BDX-XL2)
assay for  40-year-old patients with an 8 to 30 mm lung nodule and a pre-test
cancer risk (as assessed by the Mayo Clinic Model for Solitary Pulmonary
Nodules) of  50% is promising at the current time.  Clinical Studies underway
at this time are expected to demonstrate clinical utility.  These studies are
designed to show a statistically significant reduction in the number of benign
lung nodules experiencing invasive procedures between a prospective group of
patients managed by BDX-XL2 and a contemporaneous group not managed by BDX-
XL2.  A secondary end-point will show that the management of lung nodules by
BDX-XL2 does not (i.e., is statistically non -inferior to) the number of
malignant nodules routed to CT surveillance (determined at 1-year interval) as
compared to current practice without BDX-XL2.  Continued coverage for BDX-XL2
testing will be dependent on annual review of prospective data and peer-
reviewed studies.

Data collected by Biodesix through ongoing studies will support utility
including:

 All clinical risk factors to calculate the Mayo, VA, and Brock cancer risk
predictors  
 PET result (if used)  
 Physician-assessed pre-test cancer risk assessment  
 Physician post-test lung nodule management recommendation  
 Any subsequent procedures (non-invasive or invasive)  
 Clinical diagnosis based on those procedures (i.e., benign or malignant)