Estimating the Value of a Genomic Test

One of the barriers to the adoption of new diagnostic techniques is the cost in the face of uncertain value they might provide in terms of improvements to treatment decisions. In this study, we develop an approach to estimate the value of a new Genomic test in the context of care after cardiac stent surgery by analyzing the physician’s choice of medication. Using the data from a matched set of patient groups, one arm of which receives the test and another does not, we show that the proposed approach can be used to estimate the value a patient will receive from the Genomic test more accurately than a set of benchmark approaches. We follow this up to study the implication for patient welfare, adoption of new technology, and optimal revenue neutral pricing policy to minimize the total patient disutility. (SSRN)

with: Kellas Cameron, Nitin Joglekar, and Jugnu Jain (Sapien Biosciences)