Grail's Galleri test looks for 50 cancers from a blood draw, but a major study failed to prove it could detect later-stage cancers

Grail sells the Galleri test, which screens for 50 types of cancer using a blood draw.

A group of advisers to the Food and Drug Administration is reviewing a cancer detection test popular in longevity circles, potentially opening the door to insurance coverage of the Galleri test.

Galleri is a multicancer-detection test developed by Grail $(GRAL)$, a publicly traded spinoff from sequencing giant Illumina (ILMN). It's marketed directly to Americans who are at least 50 years old on platforms like Function Health and Hims & Health Health (HIMS) for $949 in cash.

But some doctors are skeptical that the test can do what it promises, particularly after Galleri failed to meet the primary endpoint - reducing later-stage diagnoses of 12 cancers - in a major study conducted with England's National Health Service. In the randomized trial, about 145,000 people without an elevated risk of cancer received the test three times in addition to traditional cancer screening, but researchers didn't see a statistically significant difference in the detection of stage 3 and 4 cancers. When Grail announced those results in February, its stock lost half its value in a single day.

"There is no evidence that any multi-cancer detection testing prevents cancer, consistently detects it at an earlier stage, or reduces cancer-associated mortality," two researchers wrote in the Lancet this week. "The widespread, sanctioned introduction of multi-cancer detection tests for the average-risk population continues to be driven predominantly by hope, not by evidence."

There are also worries about the costs and anxiety that can accompany a false-positive test.

At the same time, Galleri and other multicancer-detection tests sold by Caris Life Sciences (CAI) have captured the attention of health-focused Americans. Caris launched its test this year, and Guardant Health (GH) is working on one. Galleri's U.S. sales soared 26% last year, jumping to $136.8 million.

"The typical early customer was an affluent early adopter already investing in their health, and very often someone who had lost a parent, a spouse or a friend to a cancer found too late and did not want to be blindsided," said Roberto Veronese, a former Grail executive who now runs an advisory firm for diagnostics companies. "The numbers confirm the demand is real."

Michael Botta, the co-founder of Sesame Care, an online marketplace that connects patients directly with medical services for cash prices, is one of those customers. After his second child was born, he took a hard look at his health. He went on a statin, started taking a blood-pressure medication, and ordered a Galleri test.

"If there's any useful signal that I can get from a test like this, well, I'd rather have it than not have it," Botta said.

The test is a snapshot, not a confirmation of lifetime risk. It works by examining cell-free DNA in a patient's blood to find "signals" associated with 50 types of cancer. The theory is that it can detect cancers earlier, allowing patients to start treatment earlier, while also looking for cancers the medical system doesn't regularly screen for, like pancreatic cancer. It's not being pitched as a replacement for common cancer screening methods, like mammograms for breast cancer or PSA blood tests for prostate cancer. If a patient gets a positive test, they are instructed to undergo a cancer work-up, whether that's imaging or biopsies.

The multicancer-detection tests are part of a new wave of popular preventive health interventions like whole-body scans that seek to allow people to better understand their health. However, there are still questions about the accuracy and benefits of these tools, particularly since they are paid for in cash, though some employers like Salesforce (CRM) offer the test as a benefit to workers.

Though Grail's laboratory-developed test is sold legally in the U.S., most health insurers, including Medicare, won't cover it without premarket approval from the FDA. A provision tucked inside this year's federal spending package allows Medicare coverage of one multicancer early-detection test per year starting in 2028 if the test is FDA-approved.

FDA advisers are meeting Wednesday to vote on whether the test is safe and effective, and the benefits outweigh the risks as part of the approval process.

"A positive vote would meaningfully de-risk the [multi-cancer early detection] category and provide a favorable readthrough" for Caris and Guardant Health, according to Jefferies analyst Tycho Peterson.

The FDA often accounts for the opinions of its advisers before deciding whether to approve a product like the Galleri test but is not required to do so. The FDA's final decision is expected in the first quarter of next year.

Grail's stock closed 33.7% higher on Monday after the FDA published documents that didn't raise any significant questions about the test. Its shares are up 22.1% since the start of the year.

-Jaimy Lee