What Happened?
Shares of oncology (cancer) diagnostics company NeoGenomics (NASDAQ: NEO) jumped 3.4% in the afternoon session after the company announced the launch of the first FDA-approved immunohistochemistry (IHC) companion diagnostic test for patients with prostate cancer.
The test, called PTEN IHC CDx, is designed to identify PTEN protein loss in patients with prostate adenocarcinoma. This detection is crucial as it helps determine which patients may be eligible for AstraZeneca's recently approved targeted therapy, TRUQAP. By providing a necessary diagnostic tool for a specific, modern treatment, NeoGenomics has established a clear commercial application for its product, linking it directly to patient care decisions and a major pharmaceutical therapy.
After the initial pop, the shares cooled down to $14.68, up 3.1% from the previous close.
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What Is The Market Telling Us
NeoGenomics’s shares are very volatile and have had 29 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 10 months ago when the stock gained 22.5% on the news that a court ruled in the company's favor in a patent infringement lawsuit against Natera.
The District Court for the Middle District of North Carolina granted NeoGenomics' motion for summary judgment, declaring all of Natera's asserted patent claims invalid.
The court stated it will dismiss Natera's claims with prejudice, a final judgment that prevents the case from being brought again. This legal victory is significant as it allows NeoGenomics to freely commercialize its RaDaR® ST assay, an oncology diagnostic solution. The company has already launched the product to biopharma customers and has submitted it to the Centers for Medicare & Medicaid Services (CMS) to obtain clinical reimbursement coverage, potentially expanding its market access.
NeoGenomics is up 24.8% since the beginning of the year, and at $14.68 per share, it has set a new 52-week high. Despite the year-to-date gain, investors who bought $1,000 worth of NeoGenomics’s shares 5 years ago would now be looking at only $324.56.
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