Liquid Biopsy: 10 Years In & We’ve Only Just Begun

The TD Cowen Insight

We assess the state of the liquid biopsy market including the ‘beyond cancer’ opportunity, estimate TAMs/penetration, and consider the competitive landscape.

TD Cowen authored its first liquid biopsy Ahead of the Curve® Report 10 years ago. The market has arguably advanced faster than expected, but has recently been impacted given capital markets. Therapy selection is furthest along though ample growth remains. Minimal Residual Disease (MRD) is surging and screening is untapped.

Liquid Biopsy Testing in Oncology Becoming Routine

Liquid biopsy testing in oncology Dx has come a long way. We feel it’s just scratching the surface. Penetration is in its infancy across therapy selection, MRD testing and screening. The technology has evolved from something which ‘could be’ viable to becoming a more routine approach – more widely accepted in guidelines and growing rapidly.

Tissue-based oncology Dx approaches still dominate. Though, we expect blood-based approaches to take share and grow faster, given their non-invasive profile, ability to target tumors where tissue is inaccessible, faster time to result, and the opportunity for repeat testing.

Market Penetration for Blood-Based Testing

There is healthy enthusiasm for blood-based testing though tough capital markets (and the severe contraction in stocks for related companies) has weighed on sentiment. We remain bullish and expect material growth can unfold.

MRD is the most exciting area. Screening has the largest TAM (earlier in development). Therapy selection is the most penetrated (on a patient basis). Moreover, penetration of the revenue TAM is just ~15%, hence a material opportunity lies ahead (not to mention across biopharma).

Expected Catalysts

Across oncology Dx we estimate a TAM for liquid biopsy approaches of $100B+. We anticipate MRD trial outcomes will trigger:

1. NCCN inclusion and coverage
2. Successful CRC blood-based clinical trials/regulatory outcomes
3. An approved MCED regulatory path (NHS-Galleri early ’24 may help)
4. Traction with state biomarker bills (trigger commercial coverage)