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JP Morgan Healthcare Conference, Day 1: Exact Sciences, Revvity, Qiagen, Guardant Health, Waters

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SAN FRANCISCO – The 43rd annual JP Morgan Healthcare Conference kicked off on Monday with a bolus of companies in the diagnostics and genomics tools market providing updates on their businesses and previewing what may be coming down the pike.

Below are brief reports on individual presentations from the conference. 

Exact Sciences 

Exact Sciences CEO Kevin Conroy said in his presentation that the company is prepared to launch three new long-awaited cancer tests in 2025 in its "most productive year" yet.

The next-generation version of its Cologuard test Cologuard Plus is expected to launch early in the second quarter of 2025, while its molecular residual disease test Oncodetect is forecast for launch sometime in the second quarter. Its multi-cancer screening test Cancerguard will likely launch in the second half of 2025. Conroy added that the firm expects to announce new data for its blood-based colon cancer test around the midpoint of 2025, as well

Conroy noted that Cologuard Plus received pricing from the US Centers for Medicare and Medicaid Services last year and has already nabbed coverage from some large commercial payors. He added that the test will launch into the Medicare population first and then become available to privately insured patients. It will take approximately 18 months to transition customers from Cologuard to Cologuard Plus, Conroy said, while CFO Aaron Bloomer said the launch will "lead to growth acceleration for the next several years, as well as margin expansion." 

Oncodetect is expected to launch with CMS coverage for colorectal cancer, and the firm plans to expand to other types of cancers from there, Conroy said. The test currently looks at between 50 and 200 mutations but in the future will look for 2,000 to 5,000 mutations, he added. That ability to look for thousands of mutations confers "an advantage that over time will allow us to get more people tested with Oncodetect," he said. Conroy also cited the existing relationships Exact Sciences has with most health systems in the US, thanks to its Oncotype DX assay, as a way to potentially increase patient access to Oncodetect

Cancerguard, meantime, will launch "at a reasonable price point" for patients to pay out of pocket, he said. Exact Sciences believes that the price, which Conroy did not disclose, will be accessible to patients and is one that "payors will be willing to pay because of the health economics." He said that the firm does not expect commercial payor coverage for Cancerguard in 2025, while Bloomer added that Exact does not expect material revenue contribution from the test in 2025. 

Regarding the Q4 and full-year 2024 preliminary financial results released on Sunday, Bloomer said that growth in the quarter was driven by Cologuard. He noted that orders impacted by the hurricanes in Florida in Q3 came back "a bit better than anticipated" at the end of Q4.

Bloomer added that 2024 was a "record year of profitability" as well as for free cash flow for the company. The priority for capital allocation will continue to be reinvesting in the business, and the firm will maintain its disciplined approach to M&A, he said. 

Revvity 

Revvity CEO Prahlad Singh said that his company's diagnostics business has evolved during the past seven years from being primarily a player in the reproductive health space to becoming a diversified provider with specialized autoimmune, allergy, and emerging infectious disease offerings. The Waltham, Massachusetts-based firm has divested its applied, food, and enterprise services businesses in a $2.45 billion deal to become a pure-play diagnostics and life sciences firm. 

Today, about 60 percent of the company's $1.4 billion in annual diagnostics revenues are from immunodiagnostics and about 40 percent are from its reproductive health business. Singh said he sees opportunities for geographic and menu expansion in both of those spaces. 

He noted that newborn screening and maternal and fetal health tests remain major elements of the company's portfolio and said in his presentation that the company is planning for long-term growth in the range of 2 percent to 4 percent for its reproductive health business, which Revvity said has been outperforming falling global birth rates. 

Singh said that an estimated 75 to 80 newborn lives are saved each day through the use of Revvity's reproductive health diagnostics. 

As for Revvity's immunodiagnostics offerings, Singh said that the firm is focused on diversifying its diagnostics menu by developing specialty products rather than routine or commoditized offerings. He said that those nonroutine offerings include novel antibodies and reagents, the firm's Signals software platform for data management, and its automated newborn screening workflow. 

"The company has evolved from providing reagents, instruments, software, and services to now being a partner for pharma biotech in enabling the development of companion diagnostics for precision medicine," he said. 

As pharma partners develop therapies for rare diseases, Revvity is positioned to expand its menu, Singh said. 

"The transition that we have made with the portfolio in moving from being a vendor to a partner is what we feel will continue to provide us with a differentiated uplift," he said. 

Revvity CFO Max Krakowiak said during a Q&A session following Singh's presentation that the company expects that its full-year 2024 revenues from China will be flat to slightly down on softness in the instrument market, but he said that all of the company's other businesses have been growing in China. The firm reported in November that customers in China had been delaying instrument purchases in anticipation that they might secure stimulus funding to aid those purchases. 

While Singh in November also said that subdued pharma spending had proven to be a headwind, he said on Monday that the company had seen consecutive quarters of growth in its reagents business in the Americas and he took that as a sign that the market was returning to normal. 

On Monday ahead of the its presentation, Revvity announced that it anticipates Q4 2024 revenue growth of about 5 percent year over year and organic revenue growth of 6 percent.

Qiagen 

In his presentation on Monday, Qiagen CEO Thierry Bernard reiterated the four-year plan he first laid out last summer that is aimed at maintaining a 7 percent compound annual growth rate, reaching at least $2 billion in revenues in 2028, and returning $1 billion to shareholders over the next four years. 

As part of its efforts to return money to shareholders, the firm announced on Monday that it initiated a $300 million synthetic share repurchase that combines a direct capital repayment with a reverse stock split. The new repurchase builds on an earlier $300 million share repurchase in 2024 and is set to be completed toward the end of January. 

The value of Qiagen's common shares will be increased through a transfer from the share premium reserve to allow for the capital repayment to shareholders, followed by a reverse stock split to consolidate shares. The par value will then be reduced back to its original level and paid out directly to shareholders. 

Bernard noted that any M&A activity must be synergistic with the existing portfolio and must be accretive in two years. The first priority for M&A will be bolt-on acquisitions that are complementary to Qiagen, although the firm is willing to consider larger deals that could help address issues with scale that it faces as a mid-cap company, he said. 

The firm is focused on its growth pillars, including sample preparation technology, its QuantiFeron business, digital PCR, and syndromic testing. By 2026, Qiagen plans to launch three new sample prep instruments and focus on "higher value" sample tech, including applications in liquid biopsy, microbiome health, and minimal residual disease, Bernard said. 

The mid-throughput QiaSymphony Connect is expected to launch at the end of 2025 and will be optimized for liquid biopsy applications, he said, while the benchtop instrument QiaMini will be available in early 2026. The QiaSprint Connect will help Qiagen enter the high-throughput sample tech market and is expected to launch in 2026. 

The company also plans to launch a Lyme disease test using its QuantiFeron interferon-gamma release assay technology with DiaSorin. The test was submitted to the US Food and Drug Administration last year. 

Bernard said that the latent tuberculosis testing market for QuantiFeron is still growing, and "every year we continue to capture new markets." 

He also said that the firm has changed its organizational structure. Instead of being organized around the business units life sciences, diagnostics, and bioinformatics, the company will have two segments: product portfolio and innovation, and commercial operations. Product portfolio and innovation will cover strategic marketing and product development, he noted. 

Forecasting for the rest of 2025, Bernard said he believes capital expenses in laboratories will normalize in the second half of the year and that the US will remain the most dynamic market for molecular tools and clinical diagnostics. However, he added that he does not believe the Chinese market will bounce back this year. 

Guardant Health 

Guardant Health co-CEO Helmy Eltoukhy said that the firm's 2024 year-over-year growth in clinical test volumes was largely driven by its Guardant360 test. The company saw continuing improvements in Guardant360's average selling price, reaching its long-term goal of an ASP of $3,000 per test roughly four years ahead of schedule, thanks to an increase in the Medicare payment rate to $5,000. 

Guardant CFO Michael Bell added that there is "still room to grow" on the ASP for Guardant360 and noted that some coverage gaps remain among commercial payors. Some insurers cover only the companion diagnostic version of the test while others only cover limited cancer types, so the firm aims to expand that coverage. 

Eltoukhy noted that the test was transitioned to Guardant's Smart Liquid Biopsy platform in July, which expanded the number of genes included and improved the test's sensitivity. The firm plans to "continually add new applications to the test," he said. As it continues to test more patients and collect more data, it can "generate an almost unlimited number of differentiated applications" for the platform, he added. 

The company has also seen "excellent uptake" of the firm's Guardant360 TissueNext test thus far and has plans to launch the Guardant360 Tissue comprehensive genomic profiling test using the Smart platform technology this year. 

Regarding its minimal residual disease business, Eltoukhy said the company has submitted data to CMS's MolDx program for reimbursement of Guardant Reveal in the colorectal cancer surveillance MRD setting and hopes for reimbursement in early 2025. It has also submitted data for publication supporting potential Medicare reimbursement for the test's use in breast cancer and therapy monitoring and has ongoing clinical validity studies for additional cancers. 

Guardant co-CEO AmirAli Talasaz noted that the firm is ramping up its commercial infrastructure for the Guardant Shield test, which received FDA clearance for colorectal cancer screening last year. The company performed approximately 6,400 Shield tests in Q4 2024, driven largely by Medicare beneficiaries, he said. The test is currently priced at $920 per test, but the company is seeking ADLT designation that will raise the price to $1,495 per test. 

The firm is also expecting data from the second version of Shield in 2025 and could have version 2 on the market this year. The second version is more analytically sensitive and has an optimized algorithm, but the actual assay is the same, Talasaz said. Guardant doesn't know yet if the improved analytical sensitivity translates to better clinical performance, but it expects sensitivity for stage I colorectal cancer detection to increase. 

Talasaz added that the firm's therapy selection business is free cash flow positive, the MRD business is expected to reach breakeven by 2026, and the company expects to reach free cash flow breakeven in 2028. 

Guardant expects oncology clinical volume growth of more than 20 percent across all products this year, Talasaz said. 

Waters 

Waters President and CEO Udit Batra said that the company saw a "steady recovery" across its end markets over the course of 2024, as declining year-over-year sales in the first two quarters of the year shifted to 4 percent revenue growth in Q3 and a guidance of mid-single-digit growth in Q4. 

He said Waters expects these end markets to continue to recover in 2025 with areas like GLP-1 therapeutics and PFAS testing poised to drive instrument sales growth this year. 

Batra also highlighted Waters' clinical mass spectrometry business, which he said has in recent years seen revenue growth rise from low-single digits into the double digits. He noted the company's Xevo TQ Absolute IVD mass spectrometer, which it launched last year to target the clinical market, and added that Waters has increased its offering of consumables for endocrinology and immunosuppressant drug testing. 

Additionally, Batra touched on China, which has been a significant weak spot for the life science tools industry in recent years. He projected low-single-digit growth in China in 2025, though he noted that government stimulus could add "dynamism." 

He said Waters believes it is well positioned to capture Chinese stimulus spending, adding that the company expects to see the benefit of that spending in 2025 and 2026.