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GenomeWeb Index Up 5 Percent in October as Favorable Earnings Reports Bolster Shaky Market

NEW YORK – The GenomeWeb Index rose 5 percent in October, continuing its climb from September and once again outperforming the broader markets, which continued to shimmy in reaction to the upcoming US presidential election and continued uncertainty over the next wave of the coronavirus pandemic.

The index far outperformed the Dow Jones Industrial Average, the Nasdaq, and the Nasdaq Biotechnology Index, which fell nearly 5 percent, 2 percent, and nearly 4 percent, respectively. Individual stock performances in the GenomeWeb Index were mixed in October, as 21 of the 37 stocks saw gains and 16 saw losses.

Several companies saw double-digit growth in their share prices this month. Pacific Biosciences led the gainers with a 33 percent increase, followed by CareDx (+29 percent) and Burning Rock Biotech (+23 percent). This is PacBio's third month leading the gainers — the firm saw a 77 percent increase in share price in August and a 50 percent increase in September.

Fluidigm led the decliners in October with a 23 percent drop in stock price. Fulgent Genetics (-19 percent) came in second, followed by NanoString Technologies (-18 percent).

PacBio started the month by having its shares upgraded to a rating of Overweight by JP Morgan. In a note to investors, analyst Tycho Peterson said that a discussion with new PacBio CEO Christian Henry "provided an overview of the new strategy for the company going forward, leaving us encouraged about the abundant opportunities that lie ahead."

He noted that PacBio's strategic focus will include a sales force expansion in both the domestic and international markets, diagnostic partnerships similar to the firm's deal with Berry Genomics, and product development to bring down sequencing costs.

The company also announced in October that it is collaborating with Children's Mercy Kansas City and Microsoft to improve diagnostic yield for rare disease sequencing, and that it is undertaking a research collaboration with Invitae that will use long-read next-generation sequencing to help develop diagnostic testing for epilepsy.

CareDx's shares spiked early in October after the company said that it had received a final local coverage determination from Medicare contractor Palmetto GBA for its AlloSure Heart donor-derived cell-free DNA diagnostic test. CareDx also said that it hopes the final LCD for AlloSure Heart will lead to an approval of its HeartCare product, which is a combination of AlloSure Heart and AlloMap Heart.

The company's stock also rose on positive earnings news. It reported a 58 percent increase in third quarter revenues, thanks largely to a 61 percent increase in testing services revenues. CareDx also said it returned more than 21,800 patient results from its AlloSure Kidney blood-based, donor-derived, cell-free DNA test for organ transplant rejection and AlloMap Heart transplant test to patients in Q3, a 65 percent year-over-year increase.

Burning Rock's shares rose in anticipation of its upcoming Q3 earnings release. The company announced preliminary Q3 revenues, reporting that it expects to bring in between RMB 118 million ($17.4 million) and RMB 123 million for the quarter, representing a 16 percent year-over-year increase.

Fluidigm did have positive news in October, reporting that the US Department of Health and Human Services planned to use the company's saliva-based molecular SARS-CoV-2 test as part of a federal surge testing program. But the 5 percent gain in Fluidigm's stock price brought on by the positive news wasn't enough to overcome the drag on the shares over the last 10 days of the month. Fluidigm will report its Q3 financial results later this week.

The Scan

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But Not Harm

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Effectiveness Drop Anticipated

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