Recently, gene testing listed company Rui'ang Gene (.) has been embroiled in a fraud scandal, with four core executives of the company being detained on suspicion of fraud. The company has deep cooperation with AstraZeneca in gene testing, and its testing kits guide the treatment of targeted drugs, which is also the target indication for AstraZeneca's star oncology drug "Tagrisso."

Rui'ang Gene is an independent medical testing laboratory listed on the Science and Technology Innovation Board (STAR Market). Over the past year, the company's stock price has fallen by more than %. Rui'ang Gene was founded by Xiong Hui, a former assistant researcher at the Institute of Hematology, Ruijin Hospital in Shanghai. Xiong Hui graduated from Shanghai Jiao Tong University School of Medicine and holds a Ph.D. in microbiology from Fudan University. Her professional technical background has been recognized in the industry. Recently, Rui'ang Gene announced that Xiong Hui and several vice presidents have been detained by the police.

Some media reports suggest that this case is related to the company's alleged tampering with genetic testing results for cancer patients to defraud medical insurance funds, primarily involving AstraZeneca's lung cancer targeted drug "Tagrisso." When this drug was first launched, its price was as high as 50,000 yuan per box. After being included in the medical insurance in January 2019, it was reduced to 15,000 yuan, and after medical insurance reimbursement, the patient's out-of-pocket cost was only around 1,000 yuan.

Public information shows that AstraZeneca's star product Tagrisso was previously involved in a medical insurance fraud case. Multiple pharmaceutical representatives were convicted of fraud for altering patients' genetic test reports to make the drug eligible for medical insurance reimbursement. Rui'ang Gene is the main service provider for AstraZeneca's liquid biopsy.

Why do genetic testing institutions tamper with the genetic testing results of tumor patients? It is reported that according to previous medical insurance reimbursement rules, only patients with positive test results were eligible for reimbursement of Tagrisso medication costs. However, relevant data shows that patients with mutations can also benefit clinically, but these patients had to pay high medication costs because the indication was not included in the medical insurance reimbursement for Tagrisso at that time. It was not until the month that the indication for Tagrisso was expanded to cover mutations.

In response, a professional explained to the First Financial Daily reporter that two issues are involved: one is the off-label use of drugs; the other is the fraudulent use of medical insurance funds. "There are multiple gene mutations in lung cancer, but the indications for drugs are often very narrow and do not cover all indications. In this case, off-label use of drugs is common in both domestic and international clinical practice. Some off-label uses are supported by clinical data, but the indications have not yet been registered," an industry insider told the First Financial Daily.

But he said that fraudulent insurance claims and off-label use of medications should be treated differently. "Off-label use of medications is based on the perspective of the patient; some patients may benefit from off-label use, and with the patient's consent, medication can be administered. However, tampering with data and committing insurance fraud involves illegal activities," the person said.

The patient can't wait, can the medication be used? A renowned oncology expert told the First Financial Daily reporter, "In cases where the indication has not been approved, if there is clinical evidence-based medicine support, off-label use of medication is also acceptable, but it requires approval, and it does not consider first-line or second-line treatments." He also pointed out that if off-label use involving medical insurance reimbursement is involved, it also needs to be reported. The National Health Commission, the Medical Insurance Bureau, and the National Drug Administration have issued specific documents on this matter.

Some experts have pointed out to the First Financial Daily reporter that it took three years from when Tagrisso was included in the medical insurance in 2018 to when the indications for two additional mutations were included in 2021. Many cancer patients cannot wait that long. "During this period, is it possible to seek a faster process to ensure that patients can receive timely treatment, even if it is not covered by medical insurance?" said Wang Hui, a person from the Department of Laboratory Medicine at a large tertiary hospital, to the First Financial Daily reporter.

Wang Hui also said that if patients do not have legitimate access to medication but their needs are urgent, they may resort to "unconventional means." "Tumor patients are very desperate, and even if there is only a glimmer of hope, they would rather 'treat a dead horse as if it were still alive.'" He stated.

In recent years, under the reform of medical insurance policies, an increasing number of cancer drugs have become accessible to patients, giving rise to the demand for complementary genetic testing services. Industry insiders told Yicai Global that genetic testing, an indispensable part of cancer drug usage guidance, can be conducted in two ways: one is through internal reports issued by hospitals, and the other is by sending samples to external testing facilities.

"Gray Zone" in External Laboratory Testing. "It is unlikely that large hospitals would falsify test results. Although external testing institutions also have certification qualifications, this incident has exposed the loopholes in these institutions. How to regulate their behavior as third-party organizations, especially against the backdrop of increasing demand for genetic testing, is a question," said Fang Ke, a senior figure at a multinational medical testing institution, to the First Financial Daily reporter.

Wang Hui told the First Financial Daily reporter that some of the tumor targeted drug testing at his hospital is conducted in-house, and technically, all can be carried out. However, some are sent out for external testing. He did not specify the reasons. Fang Ke told the First Financial Daily reporter that, as he understands, there are still some "gray areas" in outsourced testing services. "The price of genetic testing is often quite high, and it is not ruled out that some third-party institutions may have ties with specific doctors, who then recommend patients to go to institutions they are familiar with for testing."

Many hospitals have been encouraging in-house testing in recent years, but in reality, due to various factors, it is still quite common to bypass hospitals for test reports," Fang Ke said. "They all have the necessary qualifications, but how hospitals can control the quality remains a question to be addressed."

A private hospital administrator told the First Financial Daily that with the increasing number of targeted cancer drugs and gene therapy drugs, the corresponding genetic testing procedures have reached a "crossroads" for reform. "The collaboration between hospitals and external entities is not a new phenomenon; this model has existed for a long time. However, the new issue now is that with the advancement of genetic testing technology and the explosion of knowledge in genomics and proteomics, doctors' cognitive limitations are becoming more apparent, increasingly relying on external technology and collaborating with external institutions to treat patients," he told the First Financial Daily.

The above individuals believe that in this process, many aspects such as the complexity of regulation and the identification of medical responsibilities face new challenges. It is necessary to continuously seek a balance between regulation and innovation, which is an eternal topic. Some advanced foreign experiences are also worth learning from.

Why has development lagged behind? Over the years, to accelerate the clinical application of products such as oncology drugs, China has also referred to the more mature laboratory developed tests (LDTs) model from abroad, encouraging hospitals to collaborate with third-party testing institutions to develop diagnostic reagents to meet more clinical needs. LDTs refer to in vitro diagnostic projects that have not yet obtained product registration and are only developed, validated, and used within the laboratory. They are not allowed to be sold as diagnostic reagents to any other medical testing departments, hospitals, or individuals.

The application of tumor drugs in clinical practice is significant, as it can be understood as a hospital's in-house reagent used for testing. Some drugs can only be applied clinically in certain ways, such as targeting new mutations in tumors. Fang Ke told the First Financial Daily reporter. He further stated that overseas, the regulation is relatively relaxed, and some state governments can approve reagents without going through the necessary approval processes.

First Financial Daily reporters have learned that currently, the main pilot programs in China are open to large public hospitals, encouraging hospitals to collaborate with manufacturers to develop new testing technologies to enter clinical applications more quickly and at lower costs. In Shanghai, pilot hospitals include Ruijin, Zhongshan, and the Children's Medical Center. A representative from Zhongshan Hospital told First Financial Daily that as long as there is a demand for innovative clinical applications, they can proceed with them at present.

However, significant breakthroughs have been difficult to achieve domestically. In response, Wang Hui told the First Financial Daily reporter that the complex regulatory process and the continued application of mature drug regulatory methods for reagent approval have hindered the development of the industry. Wang Hui stated, "Currently, the drug regulatory authorities still require registration certificates to be submitted according to the process, which contradicts the original intention of the system to enter clinical applications quickly and at a low cost, making it difficult to fully realize its effects."

In Wang Hui's view, the healthy development of medical science hinges on the exploration of innovative models. "Any technology that brings benefits must also bear risks, and only by sharing risks can we minimize them and maximize the benefits." He believes that pilot programs should be scientifically conducted. Doctors, hospital laboratories, and patients need to each bear their own risks. The laboratory must take responsibility for the testing technology, doctors must have a scientific understanding and judgment of the test results, and from the patient's perspective, they must bear their own risks.