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360Dx Top 30 Falls 5 Percent in 2023

Note: The stock prices listed for Accelerate Diagnostics, Danaher, Labcorp, and Genetron Health in 2022 did not reflect stock splits undertaken in 2023, affecting the percent change year over year and total percent change of the Top 30. The story has been changed to reflect that Natera and Exact Sciences were two of the year's biggest gainers. We regret the errors.

NEW YORK – Following a steep decline of 37 percent in 2022, the 360Dx Top 30 continued to decline in 2023, albeit at a slower pace.

The decrease contrasted with an overall uptick in the broader markets. For 2023, the 360Dx Index fell 5 percent year over year, while the Dow Jones Industrial Average rose 14 percent in 2023. Meanwhile, the Nasdaq Biotech Index was up 4 percent in 2022, and the Nasdaq Composite rose 43 percent in 2023.

Of the 30 companies in the index, the highest gainers were NeoGenomics (+75 percent), Natera (+56 percent), and Exact Sciences (+49 percent). The leading decliners were LumiraDx (-93 percent), Cue Health (-92 percent), and Invitae (-66 percent). Abbott's share price remained essentially flat year over year.

NeoGenomics saw its fortunes largely improve throughout the year. The firm's financial results saw improvements over 2022, as Q1 revenues rose 17 percent year over year and Q2 and Q3 revenues rose 18 percent, beating Wall Street consensus estimates in all three quarters. The firm also launched its Radar minimal residual disease assay clinically, garnering Medicare coverage for the test in July and Blue Shield of California coverage beginning in August. Meantime, in February, new data on the test was published showing its potential clinical utility in bladder cancer patients.

However, the Radar test was also the source of legal trouble for NeoGenomics throughout the year. In July, Natera sued the firm for patent infringement in an extension of Natera's existing patent infringement case against NeoGenomics' subsidiary Inivata. The patents relate to cancer mutation and aneuploidy detection, as well as to methods for the simultaneous replication of target loci. At the end of December, Natera won a preliminary injunction against NeoGenomics that will severely restrict the sales of Radar by banning NeoGenomics from "making, using, selling, or offering for sale in the US" of the test.

The same legal maneuvers that plagued NeoGenomics were likely a boon to Natera's stock price over the year. In addition to the preliminary injunction against NeoGenomics, Natera was awarded $19.4 million in damages in its patent infringement lawsuit against Invitae and ArcherDx related to minimal residual disease testing in May. At the end of the year, Natera was granted a permanent injunction against Invitae and ArcherDx and the use of the Personalized Cancer Monitoring products, with limited exceptions.

In July, the US District Court for the District of Delaware found Natera not guilty of unfair competition against CareDx and that CareDx is not entitled to damages related to that claim, essentially reversing a 2021 verdict concerning damages owed because of false advertising. In August, the same court issued an injunction prohibiting both companies from false advertising claims, covering nine claims made by Natera that a jury found to be unsupported by a scientific paper regarding the performance of the Prospera kidney test.

Later in the year, the US Supreme Court declined to hear a patent infringement lawsuit brought by CareDx against Natera and Eurofins Viracor about patents related to cell-free DNA analysis for noninvasive monitoring of organ transplant rejection.

In December, the Delaware court denied CareDx's motion for summary judgment on two patents held by Natera that are part of a lawsuit filed by Natera against CareDx. The case will proceed to a trial expected to begin on Jan. 22.

Along with its mostly successful legal dealings, Natera also saw positive reimbursement news throughout the year. Medicare Administrative Contractor Palmetto GBA agreed to cover the company's Signatera molecular residual disease test in patients with stage IIb or higher breast cancer, and the test received coverage from Blue Shield of California and Blue Cross and Blue Shield of Louisiana for multiple cancer indications. The firm's Prospera Lung allograft rejection monitoring platform also met Medicare coverage requirements in August.

Exact Sciences, meantime, made a significant move in 2023 by acquiring Resolution Bioscience from Agilent Technologies for $50 million. Resolution's liquid therapy selection platform complements Exact's OncoExTra test, a comprehensive next-generation sequencing-based therapy selection test. Exact plans to use the acquisition to expand into the NGS-based liquid biopsy market, executives told 360Dx.

Exact also saw a significant boost from the continued growth of its flagship Cologuard business throughout the year. The company saw 24 percent growth year over year in Q1, driven by screening and precision oncology revenues, and 19 percent growth in Q2. The firm's Cologuard screening revenue was up 31 percent year over year in Q2 and Q3, and third-quarter revenues rose 20 percent compared to the previous year. In June, the firm also announced positive topline data for the second-generation version of Cologuard from its BLUE-C study, with the new version of the test showing improvement across all topline metrics.

Toward the end of the year, Exact Sciences filed a patent infringement lawsuit against Geneoscopy related to Exact's Cologuard assay and Geneoscopy's upcoming ColoSense test.

As one of the decliners, LumiraDx faced significant financial struggles during 2023. In February and April, the company received notice from the Nasdaq that it was out of compliance with the minimum bid price requirement. In April, the firm announced it was implementing a cost restructuring program and laying off 40 percent of its global workforce in an effort to focus its resources on its main strategic priorities.

The firm also saw its quarterly revenues decline throughout 2023, as its Q1 revenues fell 82 percent and Q2 revenues decreased 53 percent. In October, it received Nasdaq delisting notice again and announced plans to appeal the delisting determination.

At the end of the year, Roche announced it would acquire LumiraDx's point-of-care testing technology for up to $350 million.

Cue Health also faced significant financial difficulties in 2023 as it adjusted to a world where COVID-19 was no longer an apocalyptic threat. At the beginning of the year, the firm announced a cost reduction plan that included layoffs of 388 employees, about 26 percent of its workforce. In May, it implemented a second cost reduction plan and layoffs of 326 employees, about 30 percent of its workforce.

The firm's financial results also declined by at least 75 percent each quarter: Q1 revenues fell 86 percent year over year, Q2 revenues fell 89 percent, and Q3 revenues declined 75 percent. As the company's financial woes continued, multiple shareholders called on Cue to realign its cost structure. In August, investment management firm Tarsadia Investments sent a letter to the firm calling for a strategic review and changes in its cost structure and capital allocation. Other stockholders also expressed concerns to 360Dx, and two months later a second group of shareholders sent a letter to the company echoing Tarsadia's suggestions.

In September, the company implemented a shareholder rights plan to reduce the likelihood that any entity can gain control of Cue through open market accumulation of stock without paying other shareholders an appropriate control premium and on terms that wouldn't deliver sufficient value for all shareholders, Cue said.

However, the firm also received positive regulatory news throughout the year that buoyed its position. In March, Cue received Emergency Use Authorization from the US Food and Drug Administration for its monkeypox test, and in June it received de novo authorization from the FDA for its at-home molecular COVID-19 test. The company was also awarded a $28 million contract from the US Department of Health and Human Services' Biomedical Advanced Research and Development Authority (BARDA) to develop a multiplex respiratory test, and it has multiple other tests in its near-term pipeline.

Invitae faced similar problems as the other decliners throughout last year, including a notice of noncompliance from the New York Stock Exchange in September and multiple legal challenges. 

In addition to the Natera lawsuit, Invitae faced a patent infringement lawsuit from Tecan Genomics in October related to the Anchored Multiplex PCR target enrichment technology found in Invitae's Personalized Cancer Monitoring service. Invitae published its first validation data on the PCM assays in August.

The firm also continued its push toward profitability and reducing cash burn, refinancing its debt and raising $30 million in the first quarter of 2023. Invitae sold select assets of pharmacogenomics decision support company YouScript to diagnostics software and services company Aranscia in November and divested its Ciitizen medical records platform in December.

Note: The 360Dx Top 30 will be updated with new entries next month. We reconfigure the list at the beginning of each year based on market cap. As a reminder, we only consider firms for this list that trade common stock on one of the major US stock exchanges.

360Dx Top 30        
Company Ticker 31-Dec-23 30-Dec-22 % change
Abbott ABT 110.07 109.79 0.26
Accelerate Diagnostics* AXDX 3.92 7.10 -44.79
Adaptive Biotechnologies ADPT 4.90 7.64 -35.86
Becton Dickinson BDX 243.83 254.30 -4.12
Bio-Rad Laboratories BIO 322.89 420.49 -23.21
Bio-Techne TECH 77.16 82.88 -6.90
Burning Rock Biotech BNR 0.93 2.25 -58.67
CareDx CDNA 12.00 11.41 5.17
Castle Biosciences CSTL 21.58 23.54 -8.33
Cue Health HLTH 0.16 2.07 -92.27
Danaher** DHR 231.34 235.30 -1.68
DermTech DMTK 1.75 1.77 -1.13
Exact Sciences EXAS 73.98 49.51 49.42
Fulgent Genetics FLGT 28.91 29.78 -2.92
Genetron*** GTH 3.68 3.36 9.52
Guardant Health GH 27.05 27.20 -0.55
Hologic HOLX 71.45 74.81 -4.49
Invitae NVTA 0.63 1.86 -66.13
Labcorp**** LH 227.29 202.30 12.35
LumiraDx LMDX 0.06 0.90 -93.33
Myriad Genetics MYGN 19.14 14.51 31.91
Natera NTRA 62.64 40.17 55.94
NeoGenomics  NEO 16.18 9.24 75.11
Opko Health OPK 1.51 1.25 20.80
Qiagen QGEN 43.43 49.87 -12.91
Quest Diagnostics DGX 137.88 156.44 -11.86
QuidelOrtho QDEL 73.70 85.67 -13.97
Revvity RVTY 109.31 140.22 -22.04
Thermo Fisher Scientific TMO 530.79 550.69 -3.61
Veracyte VCYT 27.51 23.73 15.93
360Dx Top 30 Average   82.86 87.34 -5.13

*Accelerate Diagnostics underwent a 1-for-10 stock split on July 12.

**Danaher underwent a 1128-for-1000 stock split on Oct. 2.

***Genetron underwent a 1-for-3 stock split on Oct. 26.

****Labcorp underwent a 1164-for-1000 stock split on July 3.