NEW YORK (GenomeWeb News) – Following pricing on the BRACAnalysis and Colaris tests from Medicare contractor Noridian Administrative Services, Myriad Genetics on Friday said that total revenues and diluted EPS for fiscal 2013 are expected to be at the high end of previously issued guidance.
The Salt Lake City-based company previously guided to revenues of between $575 million and $585 million and EPS of between $1.55 and $1.58.
On Friday, Noridian, the Medicare administrator for the jurisdiction covering Utah, where Myriad's tests are performed, priced the new molecular pathology codes for calendar year 2013. Under the codes, Myriad's integrated BRACAnalysis test will be reimbursed at $3,382, while Colaris is being reimbursed at $4,343.
The average private insurance reimbursement is $3,680 for BRACAnalysis and $3,800 for Colaris, Myriad said.
Though the new rate for the integrated BRACAnalysis test represents a roughly 16 percent cut from the previous reimbursement rate of $4,040, Wall Street analysts were mostly positive on the news, saying that the decision by Noridian eliminates near-term concerns on Myriad's stock.
"We believe the rate cut was favorable to consensus expectations and the announcement removes an overhang on [Myriad's] shares," William Quirk of Piper Jaffray said in a research note.
Oppenheimer's David Ferreiro, however, warned that the lower Medicare reimbursement for BRACAnalysis, compared to the rate paid by private payors, could bring down what private insurers may reimburse moving ahead.
"As the BRACAnalysis Medicare price is now [approximately] 8.1% below the average commercial price, we see the potential for a step down in private payor reimbursement as [Myriad] renegotiates contracts," he said in a note today.