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  "docSlug": "9b248b07037e",
  "documentTitle": "CareDx, Inc. (CDNA)",
  "authorId": "53_Kerrisdale_Capital",
  "authorName": "Kerrisdale Capital",
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  "presentationDate": "2019-07-01 00:00:00",
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  "notes": "Critique of CareDx's AlloSure product, focusing on market size limitations and clinical study failures.",
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      "text": "Recent clinical literature paints a uniformly negative picture of AlloSure's clinical utility",
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      "text": "This past March, Ed Huang and his colleagues published some of their findings from about 13 months of protocol AlloSure testing at Cedars-Sinai Medical Center in Los Angeles. The center conducted an AlloSure test on 352 transplant patients in the 13 month period, but only 63 patients were included in the study - those who were biopsied specifically as a result of impaired kidney function or elevated levels of donor-specific antibodies (DSA) in their blood. The group found that “the distribution of dd-cfDNA was similar between Patients with isolated CMR [TCMR] and no rejection.” In fact, the median dd-cfDNA in patients with TCMR was lower than the median in patients with no rejection at all, and 28% of the patients with no rejection tested positive with AlloSure, a fairly high rate of false positives.",
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      "text": "As we discussed previously, Medicare coverage of AlloSure has spurred many transplant clinics around the country to conduct their own studies of AlloSure clinical utility. Three of these have, to varying extents, published their findings:",
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      "text": "There are only two possible use cases that AlloSure’s accuracy in AMR might justify: The first is monitoring the effectiveness of treatment after AMR has already been diagnosed via biopsy. The problem is that the market for AMR monitoring is about 5% of the overall kidney transplant population annually. Even at CareDx's inflated $2,840 per test (which, as we discuss below, we expect will come down dramatically), that leaves a total market size of ~$100 million.",
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      "text": "The other potential use of AlloSure is as a screening test for subclinical AMR in sensitized patients who are at higher risk of AMR in the first place. This market is a bit larger than the population of patients already diagnosed with AMR and could potentially reach about $400 million. The question is: can AlloSure detect subclinical AMR? Recently published studies suggest not.",
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      "text": "The distribution of dd-cfDNA was similar between patients with isolated CMR [TCMR] and no rejection. — Cedars-Sinai Medical Center study findings",
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      "text": "20 Sensitized patients are those who, before the transplant, are known to have donor-specific antibodies (DSA), or antibodies that will attack the transplanted tissue in the absence of appropriate immunosuppression. 21 DSA is frequently, though not always, tested in sensitized patients at risk of AMR because of the strong association (~50%) between the presence of DSA and AMR.",
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      "text": "Recent clinical literature paints a uniformly negative picture of AlloSure’s clinical utility",
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