Exact Sciences jump 27% on multi-cancer results in liquid biopsy test
Head of Equity Strategy
Summary: Cancer treatment is one of the most lucrative areas of disease treatment due to the global number of cancer cases yearly. Early detection of cancer is key in the treatment of cancer as it increases the effectiveness of cancer treatment. A new diagnosis method called liquid biopsy holds a lot of potential and Exact Sciences is leading the field with a commercial diagnosis test on colon cancer. Yesterday, the shares were up 27% on results presented at a conference showing that the company's liquid biopsy test can detect six difference cancer types in early stage from blood samples.
On the Cowen Liquid Biopsy Summit yesterday, Exact Sciences presented a breakthrough in its liquid biopsy test using blood samples to diagnose multiple cancer types (see slide from the company’s presentation) at an early stage. The company already has a commercial liquid biopsy test for detecting colon cancer and has been a true US biotechnology success story growing revenue from $39mn in 2015 to $1.13bn in 2019. The technology offers a lot of hope in cancer treatment as early detection increases the probability of successful treatment. Liquid biopsies are also much more scalable and effective than scanning of tumors or dysplasia (changes in body cells).
The share price jumped 27% on the news as the test results show the potential of this cancer diagnostics technology. Exact Sciences is leading in this new frontier of diagnosis and has 250+ R&D people working on finding cancer markers. The company has over 3,000 patents filed for these cancer markers providing a strong competitive advantage. While the company has grown revenue impressive over the past five years the company has invested heavily in R&D and production, and thus the company is still not profitable generating negative free cash flow of $240mn in the past 12 months.
Latest Market Insights
Outrageous Predictions 2023: The War Economy
- The constantly growing global need for energy drives the world's richest to huddle up and launch a R&D project in a size the world hasn't seen since the Manhattan Project gave the US the first atomic bomb.
French President Macron resignsThe political stalemate in France and the rise of Marie Le Pen following the 2022 elections corners President Macron, forcing him to give up on politics and resign from his position. At least for now.
Gold rockets to USD 3,000 as central banks fail on inflation mandateAs markets and central banks realise that the idea that inflation is transitory is wrong, and that prices will remain higher for longer, gold is sent through the roof, hitting a price tag of USD 3,000
EU Army forces EU down path to full unionWith continued challenges in the region and a US military that isn't aggressively enacting its former role as global policeman, the European Union agrees to create its own armed forces, bringing the whole region closer.
A country agrees to ban all meat production by 2030In an effort to become one of the global leaders on the path to net-zero emissions, one country decides to not only put a heavy tax on meat, but to ban domestic production entirely.
UK holds UnBrexit referendumFollowing a recession and domestic pressure, the United Kingdom is thrown into political turmoil that will end with a vote to wind back Brexit.
Widespread price controls are introduced to cap official inflationHistory tells us that with the war economy comes rationing and price controls. And this time is no different, as policymakers introduce strict price controls that lead to a range of unintended consequences.
OPEC+ & Chindia walk out of the IMF, agree to trade with new reserve assetSanctions against Russia have caused widespread turmoil due to US Dollar moves in countries across the globe that don't consider the US an ally. To relieve themselves from this, they leave the IMF and create a new reserve asset.
USDJPY fixed to the USD at 200 as Japan overhauls financial systemFollowing the challenges that faced the Japanese Yen in 2022, the Bank of Japan attempts to keep the currency from sliding. Unsuccessful on the long-term, Japan will launch a reset of its entire financial system.
Tax haven ban kills private equityWith the war economy comes an increased focus on national interests and sovereign nations' ability to assert themselves. In that regard, the OECD countries turn their attention on tax havens and pull the big guns out, banning them altogether.