OBJECTIVES Personalized medicine (PM) has attracted tremendous interest, but yielded few marketed products. We examined factors influencing the approval, coverage, and reimbursement of existing PM technologies. METHODS We conducted six case studies of paired genetic tests and treatments in order to develop a framework to explain differences in adoption and reimbursement. We divided these case studies into three groups based on the purpose of the PM technology: Disease differentiation (HER2/neu with Herceptin (trastuzumab), hepatitis C genotyping with ribavirin/pegylated interferon, and Oncotype DX with chemotherapy); pharmacogenetics (UGT1A1 with irinotecan (Camptosar) and VKORC1/CYP2C9 with warfarin) and predisposition tests (BRCA 1/2 with prophylactic surgical measures and Oncotype DX with chemotherapy). RESULTS The factors influencing approval, coverage and reimbursement appear based broadly on the purpose of, and evidence for, the PM technology, rather than the type of device regulation (i.e., PMA, CLIA or 510(k)). Disease differentiation test reimbursement is more widespread than other PM tests because of better evidence, guidelines, and clinician preferences. Predisposition tests may be reimbursed, despite the lack of randomized clinical trials, because people may value the information from testing, regardless of the clinical consequences. Pharmacogenetics (PGx) faces reimbursement hurdles because of the lack of evidence about clinical utility, though some companies bypass payers, and market PGx tests directly to consumers. An additional challenge for all PM is the cumbersome existing coding system for reimbursement and the lack of value-based arrangements. CONCLUSIONS To date, the promise and hype of PM has outpaced its evidentiary support. In order to achieve favorable coverage and reimbursement and to support premium prices for PM, manufacturers will need to bring better clinical evidence to the marketplace and develop better support for the value of their products. More flexible reimbursement systems are needed to reward PM technologies that demonstrate evidence of value.