California Legislation Highlights Need for Broad Menu of Tests in Growing Healthcare Acquired Infection Market

Saturday, September 27, 2008 General News
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SUNNYVALE, Calif., Sept. 26 Cepheid(Nasdaq: CPHD) today announced that the new California Medical FacilityInfection Control and Prevention Act, aimed at reducing healthcare acquiredinfections (HAIs), calls attention to the need for a comprehensive menu ofsurveillance and diagnostic products in the growing HAI market.

HAIs continue to be a national healthcare concern. According to the U.S.Centers for Disease Control and Prevention, in 1974 Methicillin-resistantStaphylococcus aureus (MRSA) infections accounted for two percent of the totalnumber of staph infections. In 1995 that number had grown to 22 percent, andby 2004 that number had further increased to 63 percent.

"California will be the fifth state to mandate active MRSA surveillanceand testing for patients hospitalized for certain procedures," said JohnBishop, Cepheid's Chief Executive Officer. "This new legislation demonstratesthe need for a portfolio of HAI testing products to address this rapidlygrowing market. As the HAI testing leader, Cepheid is committed to deliveringproducts and services to help healthcare facilities implement effective HAItesting programs."

California SB 1058, signed into law by Governor Schwarzenegger onSeptember 25th, will require hospitals to test certain patients for MRSAwithin the first 24 hours of hospitalization. In addition, hospitals will haveto report, on a quarterly basis, incident rates of HAIs, including MRSA,Vancomyacin-Resistant Enterococci (VRE), and Clostridium difficile (C.difficile).

Cepheid's 2008 and 2009 menu of HAI products includes current and plannedGeneXpert(R) System tests for MRSA surveillance, MRSA skin and soft tissue,MRSA positive blood culture samples, VRE, and C. difficile. These productscontinue to position Cepheid with the most comprehensive HAI testing menuavailable.

HAI Reduction is a Priority at the Federal Level

Dr. Don Wright, the Principal Deputy Assistant Secretary for Health forthe U.S. Health and Human Services Department (HHS) recently reiterated HHS'commitment to reducing HAIs, by discussing his five point strategy to addressthe growing HAI problem.

Starting October 1st, 2008, Centers for Medicare & Medicaid Services (CMS)will no longer pay for the added costs of complications arising from certainhospital-acquired conditions, including catheter associated urinary trackinfections, vascular catheter associated infection, and certain surgical siteinfections (mediastinitis after coronary artery bypass graft, certainorthopedic procedures and certain bariatric surgery for obesity). A portion ofthese infections can be caused by MRSA.

About the GeneXpert System Molecular Diagnostic Platform

The GeneXpert System is a closed, self-contained, fully-integrated andautomated platform that represents a paradigm shift in the automation ofmolecular analysis, producing accurate results in a timely manner with minimalrisk of contamination. The GeneXpert System is the only system to combine on-board sample preparation with real-time PCR (polymerase chain reaction)amplification and detection functions for fully integrated and automatednucleic acid analysis. The system is designed to purify, concentrate, detectand identify targeted nucleic acid sequences thereby delivering answersdirectly from unprocessed samples. Modular in design, the GeneXpert System hasa variety of configurations to meet the broad range of testing demands of anyclinical environment.

About Cepheid

Based in Sunnyvale, Calif., Cepheid (Nasdaq: CPHD) is an on-demandmolecular diagnostics company that develops, manufactures, and markets fully-integrated systems and tests for genetic analysis in the clinical, industrialand biothreat markets. The company's systems enable rapid, sophisticatedgenetic testing for organisms and genetic-based diseases by automatingotherwise complex manual laboratory procedures.

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