This Medicare contractor will provide limited coverage for the Percepta
Bronchial Genomic Classifier (Veracyte, Inc., South San Francisco, CA) to
identify patients with clinical low- or intermediate-risk of malignancy, after
a non-diagnostic bronchoscopy, who may be followed with CT surveillance in
lieu of further invasive biopsies or surgery. A patient's clinical risk of
malignancy may be ascertained by the McWilliams or Gould risk assessment
models. Coverage does not include clinical high risk patients or patients with
known lung cancer.

Lung cancer is the leading cause of cancer deaths in the United States1. New
screening programs are expected to save lives through early detection, but are
also expected to increase the number of patients who undergo invasive
procedures to evaluate suspicious lung nodules and lesions.2

Traditionally, following the identification of a suspicious lung nodule or
lesion, clinical characteristics are utilized to determine risk and to
determine whether patients should proceed to an invasive biopsy. Clinical
characteristics that have statistically correlated with a higher risk of
malignancy in risk assessment models include older age, smoking history,
nodule size and spiculation.3,4 Anatomic location, solid versus part-solid or
non-solid characteristics, and time since smoking discontinuation have had
less consistent correlation. However, variation in cohort demographics and
data availability used in developing these models, including prevalence of
malignancy (3.7% to 54%), have challenged consistent utilization of these
models when used alone in clinical practice.

The American College of Chest Physicians (CHEST) published clinical
guidelines in 2013 to assist clinicians with assigning risk allocation5.

Table 1: CHEST - Assessment of the probability of malignancy based on
clinical factors alone.5

**Probability of Malignancy**  
---  
**Low ( <5%)** | **Intermediate (5-65%)** | **High ( >65%)**  
Young, less smoking, no  
prior cancer, smaller nodule  
size, regular margins,  
and/or non-upper-lobe  
location | Mixture of low and high  
probability features | Older, heavy smoking, prior  
cancer, larger size,  
irregular/spiculated  
margins, and/or upper-lobe  
location  
  


At the current time, in the absence of definitive guidelines, patients
assigned with a physician-assessed low or intermediate risk for malignancy may
be considered for serial CT surveillance or invasive biopsy5, and many of
these patients ultimately undergo surgery for benign disease.6

Newer predictive models, which incorporate a number of radiological and
clinical features to predict malignancies, may be more predictive than
physician assessment alone in preventing invasive procedures in patients with
benign nodules.3,4 Even with these risk models, supplementary methods to
improve diagnostic accuracy are important to prevent unneeded morbidity,
mortality and costs from invasive procedures, without increasing the risk of
missing a malignancy.

Bronchoscopy is a non-surgical diagnostic method that enables physicians to
visualize and collect cells from the patient's lung airways. An estimated
250,000 patients undergo bronchoscopy each year in the United States to
evaluate lung nodules that are suspicious for cancer.7 Up to 40% of
bronchoscopy procedures result in a non-diagnostic outcome, which means the
clinician could not reach a clinically actionable benign or malignant
diagnosis.4 Physicians are then faced with the dilemma of whether to monitor
these patients with CT surveillance or proceed to a surgical lung biopsy or
transthoracic needle biopsy associated with a greater risk of morbidity, such
as pneumothorax or hemorrhage, or mortality.8, 9

**Percepta  Bronchial Genomic Classifier (Percepta BGC) Test Description
and**  
 **Performance**

The Percepta BGC is a messenger-RNA assay measuring gene expression of 23
lung cancer associated genes and patient age. The assay is performed on
cytology brushings of bronchial epithelial cells collected during a
bronchoscopy from the main stem bronchus and stored in an RNA preservative at
4C immediately after collection. The assay results are reported as a
categorical result based on the patient's physician-assessed pretest risk of
malignancy as described below.

Table 2: Percepta Classifier Results

**Post Test Risk of Malignancy**  
---  
**Pretest Risk of Malignancy** | **Percepta  Negative Result** | **Percepta 
Positive Result**  
Low (<10%) | Very Low (<1%) | Low (<10%)  
Intermediate (10-65%) | Low (<10%) | Intermediate (10-65%)  
High (>65%) | High (>65%) | Very High (>85%)  
  
The clinical performance of Percepta BGC has been demonstrated in two
prospective-retrospective, multicenter and blinded trials.8,10 The results
from these trials showed that the classifier is able to detect cancer with a
high sensitivity exceeding the performance of bronchoscopy alone.11 In the low
and intermediate pretest risk groups, negative classifier results identified
patients at a low risk of malignancy with a high negative predictive value
(NPV) of 100% (95% CI 89-100%) and 91% (95% CI 75-98%), respectively, who may
be followed with CT surveillance in lieu of further invasive investigation.

The analytical and clinical performance of the Percepta BGC is summarized
below.

General

Intended Use | To assess the risk of primary lung cancer in current or former
smokers (>100 cigarettes in lifetime) 21 years of age or older with no
concurrent or prior cancer who (1) are assessed by their physician to have a
low or intermediate pretest risk of malignancy and (2) have had an
inconclusive bronchoscopy  
---|---  
Validated Specimen Type(s) | Bronchial epithelial brushing specimen preserved
in RNAProtect at the point of collection  
  
Analytical Performance

**Description** | **Results (with 95% Confidence  
Intervals if applicable)1**  
---|---  
  
Precision, inter-assay total  
variability

(2 operators; 3 independent runs; 3  
manufacturing reagent lots;  
10 unique samples run in  
triplicate with expected  
scores ranging from -1.10  
to +3.29; all in CLIA lab)

|

Qualitative (categorical call concordance): 86.7% (26  
of 30; 95% CI: 69.3% -96.2%)

Quantitative (score): pooled SD = 0.259 (95% CI  
0.217 to 0.304) (Represents 4.3% of score  
range, roughly -3 to +3)  
  
Reproducibility

(2 operators; 2  
independent runs; 2  
manufacturing reagent lots;  
46 unique samples run in  
singlicate with expected  
scores ranging from -1.77  
to +4.21; R&D and CLIA  
labs)

| Qualitative (categorical call concordance): 93.5% (43  
of 46; 95% CI: 82.1% -98.6%)  
Analytical sensitivity:  
Minimum input | Total RNA: 157 - 243 ng (standard input is 200 ng)  
RNA Integrity Number 4  
Critical reagent shelf-life stability (when stored per manufacturer's
recommendations) |

Ambion WT Expression Kit:  
24 months from manufacturing, 1 year from receipt

Affymetrix Gene ST Arrays:  
24 months from manufacturing, 1 year from  
Receipt

Qiagen RNAprotect: 2 years  
from manufacturing  
  
Specimen stability | 21 days at 2-8 C  
  
1Using Clopper-Pearson method  
Clinical Performance

**Description** | **Results (with 95% Confidence Intervals if applicable)***  
---|---  
Low pretest risk (n = 62) | Intermediate pretest risk (n = 101)  
Sensitivity | 100% (16-100%) | 88% (68-97%)  
Specificity | 56% (42-69%) | 48% (35-62%)  
Negative Predictive Value (NPV) | 100% (89-100%) | 91% (75-98%)  
Positive Predictive Value (PPV) | 7% (1-24%) | 40% (27-55%)  
Cancer prevalence | 5% | 41%  
  
*Using Clopper-Pearson method

The usefulness of the assay in the low and intermediate pretest risk groups
has been evaluated in 2 additional modeling studies.13 These studies suggest
that use of the classifier may safely reduce invasive surgical procedures
among patients with a low or intermediate pretest risk following a non-
diagnostic bronchoscopy. This Medicare contractor is aware that Veracyte is
also currently running the PERCEPTA Registry Trial to prospectively evaluate
the clinical utility of the classifier.

The potential usefulness of this test is that it allows physicians to
determine which patients with a low or intermediate physician-assessed pretest
risk and a non-diagnostic bronchoscopy may be candidates for CT surveillance
in lieu of further invasive biopsies or surgical procedures.

**Criteria for Coverage**  
Percepta BGC is covered only when the following clinical conditions are met:

  * Current or former smokers age 21 and greater, **and**
  * Physician-assessed low or intermediate pretest risk of malignancy based upon the following clinical characteristic stratification 3, 4 **and** :

**Low Risk ( <10%)** | **Intermediate Risk (10-60%)** | **High Risk ( >60%)**  
---|---|---  
Nodules < 10 mm <10  
pk/yr smoking history | Nodules 10 - 30 mm 10 to  
60 pk/yr smoking history | Nodules >30 mm >60  
pk/yr smoking history  
  


  * Bronchoscopy is non-diagnostic (actionable benign or malignant diagnosis cannot be reached), **and**
  * Percepta BGC results will be utilized to determine whether CT surveillance is appropriate in lieu of further invasive biopsies or surgical procedures as outlined below, **and**

**Pre-Test Risk:** | **Post-Test Risk:** | **Post-Test Diagnostic Strategy**  
---|---|---  
Intermediate | Intermediate | Proceed to further work up  
Intermediate | Low Risk | CT surveillance  
Low Risk | Low Risk | CT surveillance  
Low Risk | Very Low Risk | CT surveillance  
  


  * Test is ordered by physician certified in Percepta Certification and Training Registry  
(CTR), **and**

  * Patient is monitored for malignancy (suggested monitoring includes serial CT scans at 3 to 6, 9 to 12, and 18 to 24 months, using thin sections and non-contrast, low-dose techniques), **and**
  * Physician will report outcomes in all risk groups including those monitored initially and those who undergo immediate intervention, **and**
  * Clinical management is consistent with the post-test diagnostic strategy described above in 80% of tested patients.

Note: The Percepta BGC test should not be ordered if a physician does not
intend to act upon the test result.

**Certification and Training Registry Program**  
The Percepta Bronchial Genomic Classifier will be made available only to
Medicare patients through physicians who participate in a MolDx approved
Percepta Certification and Training Registry (CTR) program. This CTR serves
to assure the appropriate selection of patients and follow-up to ensure the
benefits of the test outweigh its risks. As part of this requirement Veracyte
will provide to this Medicare contractor reports every 6 months in a mutually
agreed upon format. The CTR will continue for 36 months from the issuance of
the final LCD or the presentation of prospective data demonstrating the
clinical utility and safety of the assay.

The goals of the Percepta CTR program are as follows:

  * To inform physicians and patients on the safe use of Percepta BGC, **and**
  * To ensure that physicians understand the limitations of the test based on its validation studies, **and**
  * Make a good faith effort to identify any safety concerns from the use of the test, **and**
  * To identify the clinical utility of the Percepta BGC test in the intended use patient population.

This Medicare contractor expects Veracyte to:

  * Establish and maintain the Percepta Certification and Training Registry (CTR);
  * Ensure that healthcare providers who order the Percepta BGC assay are registered and certified in the Percepta CTR program and that the Percepta BGC assay is available only through these providers for Medicare patients;
  * Report utilization data by final Percepta risk group;
  * Report clinical outcomes in each Percepta risk group;
  * Report all patients receiving a "Low or "Very Low" Percepta BGC assay result who are diagnosed with cancer during the CTR program;
  * Share all required data and reports in a HIPAA complaint fashion;
  * Publish final results in a peer-reviewed scientific journal with an impact factor of 4.5.

Level of Evidence:  
Quality - Moderate  
Strength - Limited  
Weight - Limited

This contractor recognizes that evidence for clinical utility for Percepta
Bronchial Genomic Classifier to identify patients with clinical low- or
intermediate-risk of malignancy after a non-diagnostic bronchoscopy is
promising at the current time. This contractor is aware that Veracyte is
currently running the Percepta Registry Trial to prospectively evaluate the
clinical safety and utility of the classifier. Veracyte will continue to
accrue patients in the Percepta Registry Trial and, at interim analyses,
demonstrate that in intended-use patients whose post-test risk is very low- or
low that there is a statistically significant decrease in the rate of nodule
progression as compared to current screening standards.  There is no coverage
for pretest 'High Risk' patients or 'never smokers.'  Continued coverage for
the Percepta assay will be dependent on semi-annual review of interim data
and/or peer-reviewed publications of clinical utility data demonstrates
decreased nodule progression and that patients can be followed with CT
surveillance in lieu of further invasive biopsies or surgery.