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NantHealth, Qiagen Shares Increase Sharply, Myriad Declines as 360Dx Index Rises 5 Percent in November

NEW YORK – Solid quarterly earnings reports led to increasing share prices for many diagnostics companies and an overall 5 percent month-over-month rise in the 360Dx Index in November.

The index's increase comes after a flat month in October. Of the 28 companies in the index, 21 companies' stocks were up, while 7 companies' share prices declined.

The broader market also had a positive month, helping to drive the index up, with the Dow Jones Industrial Average rising almost 4 percent compared to October and the Nasdaq rising nearly 5 percent. The Nasdaq Biotech Index rose 11 percent month over month.  

The company with the biggest drop last month was Myriad Genetics (-24 percent), with CareDx (-22 percent) behind it. The largest gainers were NantHealth (+66 percent), Qiagen (+44 percent), Veracyte (+25 percent) and Invitae (+24 percent).

Early last month, Salt Lake City-based Myriad announced its Q1 revenues were down 8 percent, due largely to the deletion of CPT codes that payors had used to reimburse for hereditary cancer testing. Myriad CEO Mark Capone said on a conference call to discuss the financial results that the code deletion reduced its revenues by approximately $100 million per year. Share prices rebounded somewhat toward the end of November, possibly accompanying the company's announcement that its BRACAnalysis Diagnostic System was approved by Japanese regulators.

CareDx had minimal news last month, although it did recently present data at the American Society of Nephrology's Kidney Week from an unpublished study looking at its transplant diagnostic AlloSure's ability to determine organ rejection.

Among the gainers, NantHealth reported a marginal revenue increase for its third quarter, but said during its earnings announcement that it became cash flow-positive for the first time during the quarter. Also, the US Food and Drug Administration granted NantHealth's Omics Core technology 510(k) clearance in November, a potentially significant development for the company. On the company's Q3 earnings conference call, NantHealth CFO Bob Petrou said that clearance for the tests would open the door to payor reimbursement for the tests, which the firm has repeatedly said would be crucial to it achieving profitability. The technology is a whole-exome tumor-normal in vitro diagnostic that measures overall tumor mutational burden in cancer tissue and reports somatic mutations in 468 cancer-relevant genes.

Qiagen was another big gainer in November, despite the announcement that the company would reduce its FY19 revenue guidance due to continued expected weakness in China. The diagnostics company had a busy month, signing three agreements to expand its immuno-oncology portfolio for the commercialization of future companion diagnostics.  

It also said it is fielding acquisition offers, with media speculation that Thermo Fisher Scientific approached Qiagen about a potential buyout. Brandon Couillard at Jefferies said in a research note the deal could be valued between $10 and $11 billion.

At the end of November, Qiagen and DiaSorin said they received FDA approval for the Liaison QuantiFeron-TB Plus Test, an automated workflow and assay for latent tuberculosis detection.

Meanwhile, the only news from Veracyte last month was an announcement that it presented new data at the 89th Annual Meeting of the American Thyroid Association that looked at the frequency of certain genomic alterations using the company's RNA sequencing-based test, the Afirma Xpression Atlas. Researchers for one study using the test evaluated the frequency of ALK, BRAF, NTRK, and RET fusions in about 48,000 consecutive patients with thyroid nodule fine needle aspiration samples deemed indeterminate, suspicious for malignancy, or malignant by cytopathology.

In another study using Veracyte's test, researchers evaluated the positive predictive value of the NTRK, RET, BRAF, and ALK fusions in patients with indeterminate thyroid nodules from the company's biorepository for whom surgical pathology diagnoses were available. A third study found that when RNA sequencing data was used on 48,000 thyroid nodule fine needle aspiration samples, 263 co-occurrences of gene fusions and variants were identified that were mutually considered to be mutually exclusive.

In totality, the data from the three studies "advance understanding of the frequency, positive predictive value, and co-occurrence of genomic alterations that are targeted by newly available and investigational precision medicine therapies for thyroid cancer," Veracyte said in a statement.

Invitae's month started positively, with its reported revenues growing 51 percent for the third quarter of 2019, compared to the same quarter in 2018. The San Francisco-based company reported growth across all testing segments and in international markets. Later in November, it announced its $50 million acquisition of Clear Genetics, a genetic counseling chatbot developer.

Invitae also announced a partnership with the University of Vermont Health Network to provide DNA testing for a yearlong pilot program to detect patients' risk of diseases like cancer and heart disease.  

Following the completion of its acquisition by Exact Sciences, Genomic Health has been removed from the 360Dx Index.