Ashley,
Thanks for starting this thread. I'm disappointed to hear that you chose to sell based on the prospects for competition.
While in principle the technology can be recreated by someone else, there is a huge barrier to entry in getting market acceptance (doctors + insurance companies) and, in the future for these kind of tests, FDA approval.
Oncotype DX has quite a lead in acceptance, despite not having official "FDA approval" (wasn't necessary when the product was launched). The closest competitor, "Mammaprint" (by foreign company Agendia) has FDA approval but very little market acceptance. I do not believe Agendia has the financial ability to market and sell its product, so the FDA approval is not relevant.
Of course, if Agendia teams up with a large U.S. company to sell their product, the landscape could change. But I'm not sure the market size is big enough for one of the big pharmas to want to compete with a player already entrenched in the niche. Genomic Health is already teamed with Pfizer to develop a similar test for Renal Cell Carcinoma, so they are way ahead on the big pharma front as well (not to mention a solid acquisition target in the future...although I hope that doesn't happen)
In Geoffrey Moore's terminology, Genomic Health is, by Randy Scott's intelligent design, in the bowling alley. They are dominating a small niche (a single pin) that is too small for the gorillas to care much about, with plans to move on to other pins. Once they have a handful of pins, they can set their sights on "crossing the chasm" to evolve into a gorilla.
The management team of GHDX has the DNA necessary to turn this into a multi-billion $ enterprise. It will take some luck and perseverance, but it's within the realm of possibility that GHDX is to Pfizer what Google was to Yahoo a handful of years ago (or what Yahoo was to AOL a few years before that): a little partner providing a small but essential function. Nothing to worry about...
Brad |
