Myriad Genetics Inc.
) inked an agreement with PharmaMar, a leading developer of
marine-derived drugs, for the first publicly acknowledged
commercial partnership for its homologous recombination
deficiency (HRD) tests.
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Under this new partnership, Myriad will collaborate with
PharmaMar's development program for its latest drug candidate. As
per the agreement, Myriad will carry out HRD testing on patients
enrolled in PharmaMar's Phase II clinical study of a novel drug
candidate dubbed PM1183, which induces double-stranded DNA breaks
to lead to cell death.
The company's HRD test can identify when a tumor has lost the
capability to repair DNA damage. This makes it more prone to
DNA-damaging classes of drugs. Irrespective of the genomic
causation, the HRD test can estimate the impact of the loss of
the DNA repair function. According to management, HRD status is
the most effective tool for determining patient response to
The accuracy of Myriad's HRD test to predict drug response in
patients suffering from ovarian cancer and triple negative breast
cancer has been proven on the basis of clinical data. Based on
estimates, about 490,000 individuals in the U.S. are diagnosed
with cancer annually. The eligibility of these patients to be
treated with DNA damaging classes of drugs reflects a $1 -$2
billion market opportunity for the particular HRD test in the
The partnership underlines Myriad's focus on its companion
diagnostic business. The company has agreements with several
pharmaceutical companies like
) as it works to establish itself as a strong player in the
companion diagnostic market.
Although the revenues from the companion diagnostic franchise
represents less than 6% of Myriad's revenues, we are optimistic
about increasing contributions from the segment going forward.
Management expects segment revenues to hover around the high end
of the earlier outlook of $25-$28 million in the ongoing fiscal.
Despite the several upsides, the ongoing patent litigation and
reimbursement cuts for its leading test keep us on the sidelines.
As a result, the stock carries a Zacks Rank #3 (Hold).
Nonetheless, other medical stocks such as
) are likely to do well. Both these stocks carry a Zacks Rank #2