Companion diagnostics (CDx) is a positive attempt in the direction of improving the drug development process, especially in the field of oncology, with the advent of newer targeted therapies. It helps the oncologist in deciding the choice of treatment for the individual patient. The role of CDx assays has attracted the attention of regulators, and especially the US Food and Drug Administration developed regulatory strategies for CDx and the drug-diagnostic codevelopment project. For an increasing number of cancer patients, the treatment selection will depend on the result generated by a CDx assay, and consequently this type of assay has become critical for the care and safety of the patients. In addition to the assay-based approach, molecular imaging with its ability to image at the genetic and receptor level has made foray into the field of drug development and personalized medicine. We shall review these aspects of CDx, with special focus on molecular imaging and the upcoming concept of Theranostics.