CEO SUMMARY: Automated cytology technology received a big boost when the FDA’s advisory panel voted to recommend that the FDA approve, with conditions, NeoPath’s AutoPap® System as a primary Pap Smear Screener. The company still awaits final FDA approval on this matter.
ON JANUARY 28, the Food And Drug Administration’s (FDA) Hematology and Pathology Devices Advisory Panel unanimously recommended that the FDA approve, with conditions, NeoPath, Inc.’s pre-market approval (PMA) supplement to authorize use of the AutoPap® System as a primary Pap smear screener.
The panel’s recommendation represents a milestone event in cytology and anatomic pathology. If the FDA rules favorably upon NeoPath’s PMA supplement, it marks the first time that a machine is positioned to make diagnoses from glass slides containing cells, without human intervention or review.
NeoPath’s AutoPap 300 System demonstrates the rapid convergence of three basic technologies: video imaging, morphology algorithms and CPU chip crunch-power. The sophistication and sensitivity of automated cytology systems is increasing at a steady pace. As the quality and performance of such instruments continues to improve, many clinical procedures in cytology and anatomic pathology will evolve.
This directly impacts pathologists, cytologists and laboratory executives. Both clinical practices and the economics of Pap smear testing will soon undergo radical change.
Cytologists and pathologists may be surprised to discover that these changes are for the better. THE DARK REPORT predicts that clinical practices involving Pap smears will quantifiably improve during the next 24 months. This will be accompanied by enriched reimbursement for services involving Pap smear collection, preparation, diagnosis and review. In the short term, NeoPath’s ability to sell the AutoPap System as a primary screener will stimulate these far-reaching changes to clinical practices and reimbursement.
The supplement NeoPath submitted to the FDA represents the company’s starting point for primary screening of Pap smears. As requested by NeoPath, the supplement would allow a maximum of 25% of the slides to receive AutoPap review only. Those slides would go directly to the archives as normal. The remaining 75% of the slides would undergo manual screening, aided by AutoPap’s ranking of each slide according to its risk of abnormality. Quality control rescreening would be done to 15% of the slides in both groups.
“We made a strategic decision not to request the highest sort rate that we feel the AutoPap can handle,” said NeoPath’s President and CEO, Alan Nelson, Ph.D. “In retrospect, that was the right decision. At the requested sort rate, 25%, we have demonstrable superiority and accuracy. This was substantiated in the clinical data reviewed by the FDA advisory panel.
“When the FDA issues a final letter approving the PMA supplement, AutoPap becomes the first FDA-approved machine in the world, strictly speaking, that is automatically identifying normal Pap smear slides,” observed Dr. Nelson. For those 25% of the slides ranked as normal, a report goes to the doctor and to the archives and a human never sees the slide. “Even though it does not produce a report which says ‘this slide has a high grade with the presence of HPV, for example, it does produce a report which says ‘this slide has a ranking indicative of the likelihood of abnormality.
“AutoPap’s accuracy improves as we continue to train the algorithms. Those algorithms shift upwards with every generation of refinements. Each time algorithm improvements are incorporated into the AutoPap System, we expect that clinical data will validate these improvements and allow us to gain approval for higher sort rates in the future.”
Nelson is describing an incremental strategy for validating the performance of the AutoPap System. Given NeoPath’s installed base of AutoPap Systems already operating in a QC (quality control) function at large laboratories throughout the United States, the essential next step was to document the system’s accuracy in primary screening at the requested sort rates, then obtain FDA approval.
“When the FDA issues a final letter approving the PMA supplement, AutoPap becomes the first FDA-approved machine in the world, strictly speaking, that is automatically identifying normal Pap smear slides.”
Armed with that approval, NeoPath intends to help its client laboratories incorporate primary screening to their existing AutoPap instruments. NeoPath’s strategy is viable because new CPT codes for automated cytology procedures became effective in 1998. These CPT codes make it easier for laboratories to negotiate reimbursement from insurance plans for automated cytology procedures.
“AutoPap technology has additional uses which spill over into other areas of cytology and anatomic pathology,” he continued. “NeoPath provided data to the FDA that exclu- sively involved Pap smears. In- house, we have lots of data on many different specimen types.
“We see a future for AutoPap to become an information node for cytology and anatomic pathology.” Nelson believes this is attainable because the AutoPap is 99.6% repeatable at a high rate of accuracy. “Given AutoPap’s high quality and consistency, it would be possible to create an electronic archive, instead of archiving the glass slide. In Japan, we already have physicians requesting this feature.”
“Managed care is information-intensive,” continued Nelson. “Pathologists will need to access and use clinical data in ways never before imagined. We believe that innovative pathologists will soon want to exploit the capability of our instrument to create an electronic archive of cytology and anatomic pathology slides.”
THE DARK REPORT already sees such developments. Michael Bechich, M.D., Ph.D. at the University of Pittsburgh School of Medicine, is one such pathologist actively pushing the boundaries. Using existing computer and imaging technology, he and his colleagues are actively striving to create “virtual” pathology practices that can function today.
But simply archiving cytology and anatomic pathology slides to eliminate glass storage is not the real value to pathologists. “It is the dual capability of analyzing a specimen and archiving the measurements electronically which pathologists will find most useful,” noted Dr. Nelson. “This gives any pathologist the resources to provide patient management plans with data never before accessible. At the same time, the pathologist can provide information in consultations with clinicians that improve clinical outcomes.”
THE DARK REPORT concurs. Any pathology practice which can develop these capabilities in advance of their competitors will have a “value-added” service for which both clinicians and managed care payers will generously reimburse. The ability to create unique “value-added” pathology services is what will separate pathology’s financial winners from its losers in coming years.
TIME LINE OF EVENTS FOR NEOPATH, INC.
Since FDA approval in 1995, events moved swiftly at NeoPath.
January, 1989: NeoPath, Inc. is founded in Redmond, Washington.
January, 1995: NeoPath, Inc. be- comes a publicly-traded company.
September, 1995: NeoPath’s Pre-Market Application (PMA) for the AutoPap® 300 QC System gains FDA approval for quality control and adjunct testing.
October, 1995: SmithKline Beecham Clinical Laboratories signs agreement for 12-15 AutoPap 300 instruments.
October, 1995: Quest Diagnostics Incorporated
(then known as Corning Clinical Laboratories) signs agreement
for multiple AutoPap 300 QC units.
March, 1996: Laboratory Corporation of America signs contract for evaluation of AutoPap 300 QC units.
March, 1997: AutoPap 300 approved for primary screening in Japan.
June, 1997: SmithKline purchases ten additional AutoPap 300s.
October, 1997: CPT code for the AutoPap 300 is awarded.
January, 1998: FDA advisory panel recommends that NeoPath’s PMA supplement for primary screening be granted with conditions.