Abbott's Game-Changing PLEX-ID Receives CE Mark

| About: Ionis Pharmaceuticals, (IONS)

Abbott (NYSE:ABT) reported that the PLEX-ID system has received a CE mark which allows it to be sold in Europe and several other countries. The PLEX-ID was originally called the Ibis and was owned by Isis Pharmaceuticals. Isis (ISIS) had some initial success with the device while it was in a research stage working with the US military and CDC to identify strains of organisms responsible for several outbreaks. Isis sold its Ibis division to Abbott for $215 million plus an earn-out back in 2008 so it could focus on pharmaceutical development, particularly its now named Kynamro anti-ApoB100 drug that was submitted for EU approval last year and FDA approval this week. I was highly skeptical of the decision to sell Ibis at the time and would rather have seen a JV or a sale with a minority stake being retained by Isis. As it stands, Isis will receive single digit royalties on sales of the PLEX-ID for about another 10 years. Since it took another 3+ years to further develop and validate the PLEX-ID for commercial use, one would presume Abbott has invested significant additional dollars for its development, money that Isis didn't have.

Why is this device game changing? Infectious disease doctors and even family physicians use clinical knowledge and educated guesswork to treat many infectious diseases. Tests like Rapid Flu exist, but are highly specific and are not much used for emerging diseases. Antibiotics are prescribed according to what a physician thinks is the root cause of a problem. The physician takes a sample, sends it off for culture and a resistance profile, prescribes the patient a treatment regimen based on their best guess, and then waits a few days for a report. If they chose the correct culture assay for the organism they get a report confirming the organism and a profile of resistance to treatment. This gets added to the patient chart and if a change in prescription regimen is needed it is prescribed.

The problem with this process is that a physician is treating something based on a best guess. That guess is often wrong and as a result a patient receives a completely useless treatment regimen. Many times a patient gets better on their own anyway so they think the antibiotic "worked" to clear an infection, when in reality it was their own immune system that did the work. When they don't get better and a positive culture comes back the physician may decide to change a prescribed antibiotic because even though the organism ID was correct, the prescription was wrong because the causative organism is resistant to the antibiotic prescribed. When a culture comes back negative and the patient is still not better it is back to square one. In all of these cases the patient has been prescribed an antibiotic that did nothing except make the patient pay for a drug they didn't need and expose everything in their body to the antibiotic prescribed, which breeds antibiotic resistant organisms.

With the PLEX-ID, a physician doesn't necessarily need to correctly guess the organism since the PLEX-ID will tell you what it is. This is the only clinically available technology for doing so, though several companies are working on similar assays using different technologies, none of which is out of the development stage. Not only will it give an answer, but will do so in about 8 hours, making it possible to withhold presumptive treatment, and its resistance breeding effects, until the PLEX-ID produces a result in all but the sickest patients, who will still receive presumptive treatment because of the urgency of the clinical presentation. The end result is less guesswork, faster and more accurate results, less unneeded antibiotic use, and better clinical management of patients. In other words, this technology has the ability to radically change the diagnosis and treatment of infectious disease.

Disclosure: I am long ISIS.