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Both employers and employees benefit from genetic testing

Personalized medicine cuts costs and improves health outcomes

Illustration of a double helix

Precision medicine is an approach for disease treatment and prevention that accounts for individual variability in genes, environment and lifestyle for each person. This approach allows doctors and researchers to predict more accurately which treatment and prevention strategies for a particular disease will work in which groups of people. It stands in contrast to a one-size-fits-all approach, in which disease treatment and prevention strategies are developed for the average person, with less consideration for the differences between individuals.

Pharmacogenomics is a part of precision medicine.  Pharmacogenomics is the study of how genes affect a person’s response to particular drugs. The discipline combines pharmacology (the science of drugs) and genomics (the study of genes and their functions) to develop effective, safe medications and doses that are tailored to variations in a person’s genes.

Of the $34B paid in health insurance benefits in 2017, $11.3B was spent on drug benefits.  Drug and disability costs rise at a rate exceeding inflation by two or three times. Specialty drugs make up only 2% of claims, yet represent 31% of costs.

Employers are constantly attempting to balance affordability with employee health priorities. A key lever to achieve this balance is to effectively manage the expense of high-cost chronic conditions, a classic reflection of the 80/20 rule, which in this case sees 20% of claimants influencing 80% of plan costs. High-cost chronic conditions represent an average annual drug spend that is 15 times that of other claimants. In addition, these claimants have an average of 7.8 chronic conditions, 3.3 physicians and 8.9 medications.  They’re dealing with incredible complexity.

The context of personalized medicine is relevant because it helps plan sponsors and their employees to maximize the utility of healthcare expenditure in improving health outcomes, which is the central priority.

In this column, I’ll describe two forms of testing that present a compelling return on investment for any forward-thinking human resources and business leader. The first is pharmacogenomic testing, a type of analysis that predicts which medications and dosages may be most effective, and least likely to produce adverse side-effects. Based on an individual’s DNA, we can predict responses to more than 200 drugs.

Assessing Which Medication Is Best

Consider the commonly prescribed antiplatelet, clopidogrel (Plavix). Pharmacogenomic screening can reveal a lot about an individual’s response to this drug, which is largely metabolized by the CYP2C19 gene. For example, it is estimated that up to 60% of individuals are intermediate or poor metabolizers of this medication. The 15% who are poor metabolizers experience significantly increased risk of an adverse cardiovascular event. The Clinical Pharmacogenomic Implementation Consortium recommends these individuals consider an alternative medication that is not metabolized by the CYP2C19 gene.

Statins are another example. Various people respond in various ways to statins. Some individuals don’t metabolize the cholesterol-lowering drug. If you’re taking a statin, but not metabolizing it, you are much more likely to experience adverse side effects.

Pharmacogenomics screening also can reduce the guesswork of treating depression—and the costs. Using statistics, we can expect that a company of 10,000 people will see 7% diagnosed at some point with major depressive disorder, and prescribed a first-line antidepressant. We know that for 47% of the people diagnosed, the first-line treatment will not work. Without pharmacogenomic testing, it generally takes about a year of experimenting through trial and error with different medications or dosages to get individuals on the correct medication. The total costs for this treatment, including drugs and lost productivity, exceeds $7 million. 

Implementing a pharmacogenomic test for those 47% of individuals who did not respond to first-line therapy is much more cost-effective. The screening allows you to better predict which medication will be the most effective treatment. Affected individuals would feel better, sooner and return to work more quickly, reducing lost productivity and disability leave. Even when you factor in the cost of pharmacogenomic testing, the decrease in drug costs and reduction of absenteeism and presenteeism would see a $1.4 million savings for the employer.

Medcan works with employers to design their pharmacogenomics programs. Employers can use the screening tool on a case-by-case basis, or come up with a structured approach to prioritize groups of employees. For example, we can evaluate a company’s drug claims and identify those employees who regularly take medications, to prioritize screening for them.

Proactive Genetic Screening

As Canada’s premier genetics shop, Medcan offers more than pharmacogenomics. Our portfolio of assessments includes a range of genetic testing for inherited risks of health problems, such as cancer, heart disease and late-onset Alzheimer’s.

Proactive genetic screening can determine an individual’s risk for 45 hereditary health conditions. The test empowers the individual, and his or her healthcare team, to be more proactive in managing disease risk with healthy lifestyle choices.

For example, Medcan can analyze more than 60 hereditary cancer genes to determine increased risk for 25+ inherited cancer conditions. The information can then be used to justify earlier, or more frequent, screening. For example, a genetic change found on the MSH6 gene may increase the risk for colon cancer, which then could warrant more frequent colonoscopies. A woman who discovers she has a BRCA1 or BRCA2 gene mutation, which significantly elevates the risk of developing breast cancer, would be covered for breast MRI in addition to mammograms, and would have screening start at a much earlier age, increasing the likelihood of early detection.

Medcan’s own analysis found that for every 1,000 employees, 140 have a genetic risk for serious health conditions—almost half of which will be cancer-related. We know from population-based studies that approximately 35 out of 1,000 employees are likely to develop cancer over a five-year period.

Companies pay an average of $20,000 in benefits for each employee diagnosed with cancer. Over five years, that’s an estimated cost of $700,000 for 35 employees. Factoring in additional costs for lost productivity and short-term disability leave based on an average $80,000 annual salary, that’s a total of $2,275,000.

Offering Medcan proactive genetic screening as a benefit to 1,000 employees costs only $695,000—approximately a 3:1 return on investment.

Valuable Context From Qualified Professionals

Offering genetic testing as an employee benefit can help reduce treatment costs, prevent serious conditions from developing and improve survival by catching conditions earlier. Unlike at-home recreational options, Medcan’s advanced testing is conducted with assistance from qualified genetic counselors throughout the process, who can provide advice and information that helps put complex results in perspective.

It’s time to move your company to the forefront of healthcare. Contact us at to find the right genetic testing options for your employees.

Ashim Khemani is the president of Medcan. He is the author of Canadian Group Insurance Benefits—A Practitioner’s Guide and Reference Manual, and the co-author of Global Health Care Systems: A Perspective on Issues, Practices and Trends Among OECD Nations.

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