Exact Sciences Stock Takes Off as FDA Approves Colon-Cancer Test for Younger People

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America why lineage source FACTIVA subcat snr fcode namz codetype re code namz relay SYND relay|SYND name Syndication source EXPANDER value SYND codetype RELAY code synd status modified statistic CODES_REVIEWED statistic|CODES_REVIEWED name CODES_REVIEWED value CODES_REVIEWED codetype STATISTIC code CODES_REVIEWED subject BARHEALTH subject|BARHEALTH ruleid BARHEALTH codetype SUBJECT value BARHEALTH canbedisplaysubject true name Health title Health status modified code BARHEALTH wordcount 476 wordcount|476 Photograph by Drew Hays Exact Sciences Stock Takes Off as FDA Approves Colon-Cancer Test for Younger People Exact Sciences Stock Takes Off as FDA Approves Colon-Cancer Test for Younger People Exact Sciences Stock Soars. FDA Approves Cancer Test for More People

The approval for wider use of the at-home test, Cologuard, had been expected, but not until next year.

Exact Sciences Stock Takes Off as FDA Approves Colon-Cancer Test for Younger People

The approval for wider use of the at-home test, Cologuard, had been expected, but not until next year.

https://www.medtechdive.com/news/doubt-cast-on-value-of-exact-sciences-cologuard/562576/ http://investor.exactsciences.com/investor-relations/press-releases/press-release-details/2019/Cologuard-Helps-More-People-Get-Screened-In-A-Cost-Effective-Way/default.aspx mailto:josh.nathan-kazis@barrons.com Exact Sciences Stock Takes Off as FDA Approves Colon-Cancer Test for Younger People By Josh Nathan-Kazis Photograph by Drew Hays

Good news came early for Exact Sciences, the company that sells the at-home colon-cancer test Cologuard. One analyst upgraded the stock to Buy, while another said there is now “additional upside” regarding revenue.

Monday morning, Exact Sciences (ticker: EXAS) said that the Food and Drug Administration had approved the use of Cologuard among average-risk individuals 45 and older. It had previously only been approved for people aged 50 and older.

The move had been expected, but not until next year.

“With an additional 19M patients to their overall population, EXAS is adding a $3B market opportunity, according to previous management commentary, which we believe offers additional upside to their $800M - $810M revenue guide for FY19,” wrote SVB Leerink analyst Puneet Souda in a research note.

Benchmark analyst Bruce Jackson upgraded his rating on Exact Sciences to Buy from Hold and increased his price target on the stock to $130. Shares of Exact Sciences were up 6.5% at $110.99 early on Monday.

The back story. The stock was up 64.8% so far this year as of the close of trading on Friday. Shares tumbled Sept. 9 on news of a study that raised questions about Cologuard’s cost effectiveness, questions that Exact Sciences batted back in a press release the next day.

What’s new. In its announcement on Monday, Exact Sciences set the test in the context of growing rates of colon cancer among younger people. It noted that the American Cancer Society updated its recommendations last year to suggest that colon cancer testing begin at age 45.

“We are giving health care providers a sensitive, noninvasive option that has the potential to help combat the rise of colorectal cancer rates among this younger group of people,” Kevin Conroy, chairman and CEO of Exact Sciences, said in a statement.

Looking ahead. Analysts said that the expansion would add to Exact Sciences’ potential market, and that there was room for the company’s product to reach far more patients.

“We remain Outperform-rated on EXAS given our view that Cologuard remains highly underpenetrated in a 100M+ patient strong market,” SVB Leerink’s Souda said.

In his note, Benchmark’s Jackson wrote that the news comes after a strong quarter for the company. “Given historic ordering patterns, 3Q should also be strong,” Jackson said.

Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.