Integration of Novel Diagnostics into Clinical Practice

John Schneider, Ph.D

By John Schneider, Ph.D

Similar to drug and device markets, a critical part of the success of novel diagnostics is educating providers on clinical and therapeutic utility.  However, unlike pharmaceutical drugs, the ordering of a diagnostic test does not necessarily imply a change in provider behavior or a change in treatment strategy.   It’s a bit like whether a tree falling in the forest makes any noise.

Medicine is as much art as science, and many physicians continue to rely disproportionately on intuition, traditional forms of diagnosis, and the standard practices of the medical community—all of which are reinforced by practice cultures which vary by setting, geography, training, and so on.

With the exception of diseases and conditions in which clinical practice guidelines (CPGs) strongly promote the use of a particular diagnostic, not only are physicians under no obligation to order a test, but they are under no obligation to take action based on a test result.

For a diagnostic to have “value”—clinical or economic—the results of the test must in some way lead to a change in provider behavior in the form of an altered or augmented treatment approach, the ordering of additional tests, or referral to additional services.

This may be less of a problem for companion diagnostics, where the bundling of tests and treatments explicitly links test results and provider behavior, as in the case of, for example, the companion diagnostic HER2/neu in treatment of breast cancer. HER2/neu helps identify patients who will benefit from the oncology drug trastuzumab (Herceptin®),[1] and oncology guidelines have explicitly recognized this.[2]  But other molecular diagnostics are only effective if provider behavior changes in response to test results.  Again, the existence of an ordered test does not necessarily compel caregivers to deviate from the status quo.

The path toward moving genomic diagnostics from the laboratory into clinical practice is heavily dependent on the generation of reliable evidence of clinical utility.  A diagnostic test has clinical utility if its use leads to clinician decision making resulting in improved patient outcomes.[3]  With sufficient evidence, clinicians in leadership roles are more likely to promote the use of novel diagnostics, and such promotion is a critical first step toward incorporating biomarkers into clinical protocols and CPGs.[4]


-John E. Schneider, PhD & Cara M. Scheibling

Avalon Health Economics




[1] J. Cohen, A. Wilson, and K. Manzolillo, “Clinical and Economic Challenges Facing Pharmacogenomics,” Pharmacogenomics J 13, no. 4 (2013).

[2] S. H. Giordano et al., “Systemic Therapy for Patients with Advanced Human Epidermal Growth Factor Receptor 2-Positive Breast Cancer: American Society of Clinical Oncology Clinical Practice Guideline,” J Clin Oncol 32, no. 19 (2014).

[3] M. R. Trusheim et al., “Uncertain Prognosis for High-Quality Diagnostics: Clinical Challenges, Economic Barriers and Needed Reforms,” Pharmacogenomics 14, no. 3 (2013).

[4] R. Simon, “Lost in Translation: Problems and Pitfalls in Translating Laboratory Observations to Clinical Utility,” Eur J Cancer 44, no. 18 (2008); S. E. Taube, J. W. Jacobson, and T. G. Lively, “Cancer Diagnostics: Decision Criteria for Marker Utilization in the Clinic,” Am J Pharmacogenomics 5, no. 6 (2005).

John Schneider

Dr. Schneider was one of the founding partners of the Health Economics Consulting Group, LLC (HECG) which merged with Oxford Outcomes in 2009. Since that time Dr. Schneider has served as Senior Director of the U.S. health economics operations of Oxford Outcomes, which in recent years has included facilitating integration between Oxford Outcomes and ICON plc. He started Avalon Health Economics in 2013 by bringing together the consulting practices of several industry and academic colleagues, building on what he started with HECG in 2004. Prior to starting HECG Dr. Schneider was on the faculty in the Department of Health Management and Policy and the Department of Economics at the University of Iowa. His PhD is in Health Services and Policy Analysis from the University of California Berkeley, with a concentration in health economics. He has over 25 years of experience studying economic and organizational aspects of the health care industry, including professional appointments at the Center for Health Economics Research (Waltham, MA; now part of RTI International), and the California Association of Health Plans (Sacramento, CA).Dr. Schneider has also served as a consultant to managed care organizations, state health departments, trade associations, medical device manufacturers, large pharmaceutical companies, and others. He has also served as an expert witness in several legal proceedings. Dr. Schneider’s expertise include analysis of medical care costs, health insurance and managed care, regulation, hospital competition, specialty hospitals, physician ownership, outcomes research, technology assessment, process change, and insurer-provider contracting. Some of his research has been published in Medical Care Research and Review, International Journal of Healthcare Finance and Economics, Tobacco Control, Health Economics Review, Health Affairs, Inquiry, Health Services Research, Review of Industrial Organization, International Journal of Technology Assessment in Health Care, American Journal of Medical Science, Prevention Science, and Health Care Financing Review. He is co-author of The Business of Health (AEI Press, 2006).

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