Quest Diagnostics Acquires Haystack Oncology and its MRD Platform
By Alex Keown
April 27, 2023
Diagnostics powerhouse Quest Diagnostics expanded its capabilities in oncology through the all-cash acquisition of Baltimore’s Haystack Oncology, an early-stage company focused on minimal residual disease (MRD) testing.
MRD testing is a fast-growing category of liquid biopsy tests that identify circulating tumor DNA (ctDNA) in the bloodstream of patients following surgery and treatment for cancer. MRD testing can accurately detect residual or recurring cancer and better inform treating physicians for future treatment. Based on a simple blood test, MRD testing is considered less invasive or inconvenient than current lab tests.
ctDNA molecules are a marker of the presence of cancer. They indicate the disease will recur.
Haystack’s MRD testing platform is designed to help inform clinical interventions through the creation of personalized diagnostic panels to customize optimal treatment plans for each patient, independent of a tumor’s origin.
Founded in 2021, Haystack, which is located in Baltimore’s City Garage Science and Technology Center, developed a highly-sensitive liquid biopsy technology that can detect circulating DNA from residual or recurring tumor cells. Company data showed its technology is able to identify stage 2 colon cancer patients with residual disease for adjuvant chemotherapy. This reduced chemotherapy use in the overall patient population without compromising recurrence-free survival, the company noted.
Speaking in a conference call, Jim Davis, chairman and chief executive officer of Quest Diagnostics, expressed excitement about Haystack’s best-in-class ctDNA MRD technology, which was licensed from Johns Hopkins University. The addition of Haystack’s technology will allow Quest to play a leading role in guiding therapy selection for cancer patients. Davis said Haystack’s platform will complement Quest’s existing TSO-500 oncology assay, Davis said.
Neither surgery nor adjuvant therapy necessarily eliminates residual cancer molecules. This leads to regular monitoring of patients for potential resurgence of the diseases. Davis said Haystack’s MRD technology, combined with Quest’s existing platform, will play a significant role in the course of cancer treatment.
“Haystack’s liquid biopsy technology, combined with Quest’s strengths in screening, pathology and sequencing, will now position us to lead in the fast-growing MRD category. Working with Haystack, we have an opportunity to broaden access to MRD insights and potentially improve favorable long-term outcomes from cancer,” Davis said.
Dan Edelstein, president and chief executive officer of Haystack Oncology, said the merger of the companies will result in a “major step forward” in liquid biopsy research and development. The combination of diagnostic capabilities will create clinical laboratory services that are “highly reliable and broadly accessible.” He noted that MRD development has been “challenging” to date.
“With Quest, we expect to increase and accelerate access to important tests that will improve the quality of cancer MRD detection and recurrence monitoring for patients. Working together, we have the potential to greatly transform the patient journey and save lives,” Edelstein said in a statement.
Under the terms of the agreement, Quest paid $300 million in cash at closing, which is expected in the second quarter of this year. An additional $150 million will be paid depending on future performance milestones.
Following the close of the acquisition, Quest Diagnostics will adapt the MRD test as the basis for new clinical lab services available beginning in 2024. Development efforts will focus initially on MRD tests for colorectal, breast and lung cancers, the company noted in its announcement.
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Alex Keown is a freelance journalist who writes about a variety of subjects including the pharma, biotech, and life science industries. Prior to freelancing, Alex has served as a staff writer and editor for several publications.
