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360Dx Top 30 Drops 6 Percent in May

NEW YORK – Diagnostics companies continued to see their stock prices decline in May as the 360Dx Top 30 decreased 6 percent month over month, following a 2 percent slide in April.

The Top 30 partially aligned with the broader market as the Dow Jones Industrial Average fell 3 percent month over month, although the Nasdaq rose 6 percent. The Nasdaq Biotech Index declined nearly 3 percent.

The Top 30's highest gainers were Fulgent Genetics (+34 percent), Guardant Health (+30 percent), and Exact Sciences (+27 percent). The decliners were led by LumiraDx (-25 percent), DermTech (-22 percent), and Invitae (-21 percent).

Fulgent Genetics' stock price was buoyed by its announcement of Q1 2023 financial results, as the company announced its core revenues more than doubled year over year to $62.7 million from $25.1 million a year ago. While reported revenues declined 79 percent overall as a result of an expected drop in COVID-related revenues, the company raised its full-year revenue guidance to $250 million from $240 million on the back of the core growth. Overall revenues were $66.2 million compared to $320.3 million in Q1 2022, beating analysts' average estimate of $60.0 million.

Guardant Health also benefited from reporting its financial results last month, with the company announcing that Q1 2023 revenues rose 34 percent year over year to $128.7 million from $96.1 million in Q1 2022. During a conference call to discuss those results, co-CEO AmirAli Talasaz said that the firm has completed its application to the US Food and Drug Administration for premarket approval of its colorectal cancer screening test Guardant Shield. The company also shared new data on the test during Digestive Disease Week last month, with the assay reaching 81 percent sensitivity for stages I through III. Stage I sensitivity was 55 percent, while sensitivity for stages II through IV was 100 percent.

According to Canaccord Genuity analyst Kyle Mikson, the data was in line with the estimates of most investors.

In a note to investors, William Blair's Andrew Brackmann wrote that questions about the test persist, including those surrounding FDA labeling, modeling outcomes for testing intervals, and private pay reimbursement. He added that he doubts whether the test, with "this level of early-stage performance, will take meaningful share."

Later in the month, Guardant said that it received commercial health plan coverage for its Guardant 360/Guardant 360 CDx liquid biopsy cancer profiling test from Anthem Blue Cross and Blue Shield, Aetna, and Humana. With the coverage, the assay is covered for this profiling indication by all major US commercial health insurance, the company said.

Like its fellow gainers, Exact Sciences reported Q1 2023 financial results in May, with revenues up 24 percent to $602.5 million from $486.6 million in the year-ago quarter and handily beating Wall Street estimates of $543.5 million. The growth caused the company to raise its full-year revenue guidance to a range of $2.38 billion to $2.42 billion from previous expectations of $2.27 billion to $2.31 billion.

In a note to investors after the results were announced, BTIG analyst Mark Massaro wrote that the firm's path to profitability is clear and called Q1 a "truly exceptional quarter."

Among the decliners, LumiraDx led the pack with its announcement of Q1 2023 financial results. The firm reported an 82 percent decrease in revenues to $22.2 million during the quarter, falling from $126.4 million in Q1 2022. The company was affected by lowered demand for COVID-19 testing, although it did exceed the Wall Street consensus estimate of $19.6 million.

DermTech also reported Q1 2023 revenues early last month, announcing that total revenues were down 5 percent at $3.5 million from $3.7 million in the first quarter of 2022, matching analysts' average estimates.

The firm has continued to build insurance coverage of its DermTech Melanoma Test and said in May that it signed new agreements with a Blues plan in South Carolina and the United Mine Workers of America Health and Retirement Funds. Approximately 1.7 million members of the Blues plan and 90,000 beneficiaries of UMWA Funds will be able to access the test.

Invitae, like the other gainers and decliners, announced financial results last month that had an impact on its share price. The firm reported that its revenues declined 5 percent to $117.4 million in Q1 2023 from $123.7 million in Q1 2022 but beat analysts' average estimate of $116.6 million. The decrease was due to exited business and geographies, and excluding revenues related to those exited businesses and geographies, Q1 revenues grew about 10 percent year over year.

Also in May, a jury in the US District Court for the District of Delaware awarded Natera $19.4 million in damages in a patent infringement lawsuit against Invitae and ArcherDx. After the verdict, Invitae announced its intent to appeal. 

360Dx Top 30        
Company Ticker 31-May-23 30-Apr-23 % change
Abbott ABT 102.00 110.47 -7.67
Accelerate Diagnostics AXDX 0.70 0.88 -20.45
Adaptive Biotechnologies ADPT 6.96 7.14 -2.52
Becton Dickinson BDX 241.76 264.31 -8.53
Bio-Rad Laboratories BIO 373.35 450.79 -17.18
Bio-Techne* TECH 81.79 79.88 2.39
Burning Rock Biotech BNR 2.61 3.11 -16.08
CareDx CDNA 7.98 8.09 -1.36
Castle Biosciences CSTL 24.43 22.63 7.95
Cue Health HLTH 0.76 0.79 -3.80
Danaher DHR 229.62 236.91 -3.08
DermTech DMTK 2.38 3.04 -21.71
Exact Sciences EXAS 81.58 64.07 27.33
Fulgent Genetics FLGT 39.77 29.57 34.49
Genetron GTH 0.90 0.95 -5.26
Guardant Health GH 29.32 22.56 29.96
Hologic HOLX 78.89 86.01 -8.28
Invitae NVTA 1.07 1.36 -21.32
Labcorp** LH 212.53 226.71 -6.25
LumiraDx LMDX 0.41 0.55 -25.45
Myriad Genetics MYGN 22.06 21.29 3.62
Natera NTRA 47.11 50.72 -7.12
NeoGenomics  NEO 17.18 14.62 17.51
Opko Health OPK 1.39 1.47 -5.44
Qiagen QGEN 45.16 44.61 1.23
Quest Diagnostics DGX 132.65 138.81 -4.44
QuidelOrtho QDEL 85.14 89.95 -5.35
Revvity RVTY 115.32 130.49 -11.63
Thermo Fisher Scientific TMO 508.46 554.90 -8.37
Veracyte VCYT 25.88 22.64 14.31
360Dx Top 30 Average   83.97 89.64 -6.33

*Bio-Techne paid a dividend of $.08 per share on May 12.

**Labcorp paid a dividend of $.72 per share on May 17. 

Note: PerkinElmer's name was changed to Revvity last month after divesting its applied, food, and enterprise businesses.