Life sciences company Bionano (BNGO) has drawn a lot of attention this year due its potential to disrupt the cytogenetics field - the study of chromosomes. Bionano’s optical genome mapping (OGM) platform Saphyr could be a real game changer in the diagnosis of prenatal and pediatric disorders, hematological malignancies and solid tumor cancers.
BTIG’s Sung Ji Nam has been following the company’s progress and recently spoke to Dr. Brynn Levy, Medical Director of the Clinical Cytogenetics Laboratory of the New York Presbyterian Hospital, to find out how much of an impact Bionano’s OGM tech could have in cytogenetics labs.
The KOL (key opinion leader) who was heavily involved in the deployment of microarray technology for cytogenetics more than a decade ago believes the OGM tech “could be even more disruptive.”
In fact, Dr. Levy believes the present gold standard cytogenetics techniques of karyotyping, FISH (fluorescence in situ hybridization) and CMA (chromosomal microarray analysis), could potentially be entirely replaced by the OGM technology. This is due to a number of advantages.
“Compared to karyotyping,” Nam explained, “OGM eliminates the need for cell culture, and karyotyping has the disadvantage of getting artifacts in cell culture (not reflecting what's happening in the patient).”
Like microarrays, OGM can offer high resolution copy number analysis, but unlike microarrays, OGM can also identify balanced rearrangements.
Fusions can also be identified by OGM. These are important in cancer diagnostics, especially in hematological disorders, and vs. FISH, OGM does not need to use multiple probes to simultaneously detect the translocation and what the partner gene is.
The tech, however, still needs to prove it is up to the task. Potential hurdles for OGM adoption are “demonstrating clinical utility (BNGO has clinical trials underway) and gaining reimbursement.”
With this in mind, to illustrate the clinical benefit of OGM as the first-line diagnostic tool for cytogenetic uses across prenatal, pediatric, hematological malignancies and solid tumor markets, the company has four large clinical studies in process, with roughly 5,000 patients taking part. The objective is to “drive guideline inclusions, third-party reimbursement and broad clinical adoption.”
So, promising for Bionano, but what does it all mean for investors? All in all, there’s no change to Nam’s Buy rating or $10 price target. There’s potential upside of ~94% from current levels. (To watch Nam’s track record, click here)
Two other analysts have recently thrown the hat in with reviews, and they are both positive, making for a Strong Buy consensus rating. Interestingly, Nam’s objective is a modest one when put against her colleagues’ expectations; the average price target stands at $12, suggesting shares will climb 133% higher over the next 12 months. (See BNGO stock analysis on TipRanks)
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