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Castle Biosciences Paces Gainers, Qiagen Leads Decliners as 360Dx Index Grows 2 Percent in December

NEW YORK – There was modest holiday cheer for the stocks of most diagnostic firms in December as the 360Dx Index improved 2 percent month over month compared to November.

The index outpaced the Dow Jones Industrial Average, which was up almost 2 percent from November, and the Nasdaq Biotechnology Index, which grew a fraction of 1 percent, but it lagged the Nasdaq, which rose about 3.5 percent month over month.

The gainers outnumbered the decliners 19 to nine, paced by Castle Biosciences (+28 percent), Exact Sciences (+14 percent), NeoGenomics (+13 percent), and Accelerate Diagnostics (+13 percent).

Qiagen (-21 percent) was the biggest decliner in December, followed by Invitae (-19 percent), GenMark Diagnostics (-14 percent), and NantHealth (-13 percent).

In November, Castle Bio reported a fourfold increase in its Q3 revenues, which sent its shares soaring almost 20 percent in one day. Since then, the company's shares have continued rising steadily. In December, it said that it had been added to the Nasdaq Biotechnology Index, and at the end of the month, Castle Bio announced study results that demonstrated its Decision-Dx-Melanoma test was able to achieve a higher level of evidence than determined by major organizations that publish melanoma management guidelines.

Exact Sciences, meanwhile, apparently benefitted quickly from its recent acquisition of Genomic Health. Last month, Exact Sciences reported new outcomes data from two large population-based studies for Genomic Health's Oncotype DX Breast Recurrence Score test at the San Antonio Breast Cancer Symposium. According to the firm, the data suggest that use of the test in clinical practice is consistent with earlier clinical validation studies. One analysis from the US National Cancer Database of more than 4,700 women 40 years of age and younger with node-negative disease demonstrated a distribution of Recurrence Score results consistent with existing clinical evidence.

Another analysis from the Surveillance, Epidemiology, and End Results registry program of the National Cancer Institute demonstrated a "significant association between Recurrence Score results and breast cancer-specific mortality (BCSM)," Exact Sciences said in a statement.

NeoGenomics presented its own research last month, reporting, it said, for the first time, mutational profiling of Epstein-Barr virus-positive large B-cell lymphoma. "Aside from providing diagnostic support, the finding of XP01 E571 mutation may suggest a targeted therapeutic option," the firm said in a statement.

Meantime, it said that moving forward, continued work in next-generation sequencing and companion diagnostics would remain an important part of its growth plans.

The biggest news from Accelerate Diagnostics last month was the announcement that former Roche Diagnostics North America CEO and President Jack Phillips would replace Lawrence Mehren as CEO of Accelerate Diagnostics, effective Feb. 1, 2020. Phillips has been COO of the company since September.

Among the decliners, Qiagen returned a large portion of the gains that it saw in November, when its stock value spiked nearly 44 percent. On Christmas Eve, the company announced that after a review of strategic alternatives, it had decided it would remain a stand-alone business. Investors soured on the news, sending the company's shares tumbling 21 percent in one trading day.

The only news from Invitae in December was an announcement that it was partnering with BioMarin Pharmaceuticals to expand access to genetic testing for skeletal dysplasia.

In mid-December GenMark's stock was downgraded by JP Morgan to a Neutral rating with the bank saying that while the company experienced healthy momentum in 2019, reimbursement and competitive pressures pose a risk to its business outlook.

Lastly, there were no obvious reasons for the drop in NantHealth's stock price in December.