NEW YORK – After having fallen 3 percent in February, the GenomeWeb Index fell 3 percent again in March.
The index underperformed the Dow Jones Industrial Average and the Nasdaq, which rose 7 percent and rose a fraction of a percent, respectively, in March. However, the index outperformed the Nasdaq Biotechnology Index, which fell 4 percent last month. Individual stock performances in the GenomeWeb Index were largely negative last month, as 14 of the 37 stocks saw gains and 23 saw losses.
Meridian Bioscience led the gainers in March with a 25 percent increase in share price, followed by GenMark Diagnostics (+22 percent) and Pacific Biosciences (+9 percent). GenMark had been February's top gainer with a 42 percent increase in share price.
Adaptive Biotechnologies led the decliners in March with a 29 percent drop in stock price. Burning Rock Biotech (-25 percent) and Quanterix (-23 percent) rounded out the list of decliners for the month. Burning Rock and Quanterix had been two of February's top gainers with 19 and 17 percent increases in share price, respectively.
There was no clear reason for Meridian's increase in share price in March as the company hadn't announced any significant news during the month. However, its share price did begin to go up in the middle of March after it launched its Air-Dryable Direct DNA qPCR Blood Mix for manufacturing room temperature-stable molecular diagnostic tests direct from whole blood, plasma, or serum.
GenMark's shares have been climbing steadily since Roche announced on March 15 that it planned to acquire the company for approximately $1.8 billion in cash. Under the terms of the merger agreement, Roche began a tender offer to acquire all outstanding shares of GenMark's common stock for $24.05 per share. Once the tender offer is finished, Roche will acquire the remaining shares for the same price through a second step merger. The deal is expected to close in the second quarter.
The reason for the decline in Adaptive's shares is also unclear. The only news the company announced last month was that the US Food and Drug Administration issued Emergency Use Authorization to the firm's T-Detect COVID-19 Test, which is used to determine whether an individual had been infected with SARS-CoV-2 in the past.
In a note to investors, BTIG analyst Mark Massaro wrote that he believes the primary reason for the stock decline is "investors taking profits in higher multiple growth-oriented names in favor of lower-multiple, value-oriented names." He also acknowledged that "we have seen our entire sector sell off in recent weeks."
This sell-off could also explain the dip in Burning Rock's shares. The company reported fourth quarter earnings in March, and despite a negative impact from the COVID-19 pandemic, revenues rose nearly 50 percent year over year due to an increase in the average sales price per patient, along with test volume growth in the firm's central laboratory channel. The Chinese firm also reported that its in-hospital test revenue nearly tripled compared to 2019.