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360Dx Top 30 Slides 2 Percent in April

NEW YORK – Many diagnostics companies saw their stock prices fall in April as the 360Dx Top 30 decreased 2 percent month over month, following a 2 percent rise in March.

The Top 30 contrasted with the broader market as the Dow Jones Industrial Average rose nearly 3 percent month over month, while the Nasdaq was flat. The Nasdaq Biotech Index increased nearly 2 percent.

The Top 30's highest gainers were Accelerate Diagnostics (+26 percent), LumiraDx (+17 percent), and Burning Rock Biotech (+11 percent). The decliners were led by Cue Health (-57 percent), Adaptive Biotechnologies (-19 percent), and DermTech (-17 percent).

Accelerate Diagnostics last month announced a restructuring service agreement that solves its debt overhang caused by $57 million in 2.5 percent convertible notes that was originally due in March, according to an investor note from Craig-Hallum analyst Alex Nowak. The maturity of the notes was pushed out nearly four years and amended to an interest rate of 5 percent and conversion price of $.72. The changes mark a "likely better result than investors may have feared, particularly for a situation that has reached debt forbearance and multiple extensions," Nowak said. The agreement reduces the overall debt load from $92 million to $67 million, he noted.

The company's largest shareholder also entered multiple purchase agreements with Accelerate, which increased its basic shares outstanding to 143 million from 104 million and resulted in about $14 million in new capital infused into the firm, Nowak said.

In a note to investors, William Blair analyst Andrew Brackmann added that there was no guarantee the proposed transactions would be agreed upon by all parties and that the firm could still face bankruptcy. However, he said that the agreement should be viewed positively, and he believes the transaction will be successful, leaving the company "with a more simplified capital structure, less debt, and sufficient capital."

LumiraDx, meantime, announced in April that it was implementing a cost restructuring program and laying off 40 percent of its global workforce. The aim of the program is to reduce the company's scale and operations to pre-pandemic levels, allowing LumiraDx to focus its resources on its key strategic priorities, such as commercializing its existing product portfolio and expanding its offerings in the US through regulatory submissions. 

Toward the end of the month, the company also announced that it had received a delisting warning from the Nasdaq due to lack of compliance with the market's minimum bid price requirement. The firm's common stock had traded below the $1.00 threshold for 30 consecutive business days and LumiraDx has 180 calendar days to regain compliance.

Burning Rock Biotech and Cue Health also did not have key pieces of news last month, although both firms have low starting share prices that are easily affected by changes in the market.

Adaptive Biotechnologies' only major news was the announcement that its Chief Operating Officer Mark Adams would be terminated by May, with his duties absorbed by current President Julie Rubinstein. According to an investor note from BTIG analyst Mark Massaro, the choice to consolidate the duties into one role was "in part to streamline decision-making, as well as to further accelerate cost savings to the business."

Fellow decliner DermTech announced in April that its Melanoma Test is available to 3.8 million Blue Cross Blue Shield of North Carolina beneficiaries, expanding the assay's availability to approximately 126 million people in the US.

360Dx Top 30        
Company Ticker 30-Apr-23 31-Mar-23 % change
Abbott* ABT 110.47 101.26 9.10
Accelerate Diagnostics AXDX 0.88 0.70 25.71
Adaptive Biotechnologies ADPT 7.14 8.83 -19.14
Becton Dickinson BDX 264.31 247.54 6.77
Bio-Rad Laboratories BIO 450.79 479.02 -5.89
Bio-Techne TECH 79.88 74.19 7.67
Burning Rock Biotech BNR 3.11 2.81 10.68
CareDx CDNA 8.09 9.14 -11.49
Castle Biosciences CSTL 22.63 22.72 -0.40
Cue Health HLTH 0.79 1.82 -56.59
Danaher DHR 236.91 252.04 -6.00
DermTech DMTK 3.04 3.68 -17.39
Exact Sciences EXAS 64.07 67.81 -5.52
Fulgent Genetics FLGT 29.57 31.22 -5.29
Genetron GTH 0.95 1.05 -9.52
Guardant Health GH 22.56 23.44 -3.75
Hologic HOLX 86.01 80.70 6.58
Invitae NVTA 1.36 1.35 0.74
Labcorp LH 226.71 229.42 -1.18
LumiraDx LMDX 0.55 0.47 17.02
Myriad Genetics MYGN 21.29 23.23 -8.35
Natera NTRA 50.72 55.52 -8.65
NeoGenomics  NEO 14.62 17.41 -16.03
Opko Health OPK 1.47 1.46 0.68
PerkinElmer** PKI 130.49 133.26 -2.08
Qiagen QGEN 44.61 45.93 -2.87
Quest Diagnostics*** DGX 138.81 141.48 -1.89
QuidelOrtho QDEL 89.95 89.09 0.97
Thermo Fisher Scientific TMO 554.90 576.37 -3.73
Veracyte VCYT 22.64 22.30 1.52
360Dx Top 30 Average   89.64 91.51 -2.04

*Abbott paid a dividend of $.51 per share on April 13.

**PerkinElmer paid a dividend of $.07 per share on April 20.

***Quest Diagnostics paid a dividend of $.71 per share on April 6.