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Mizuho Initiates Coverage of Myriad Genetics

By a GenomeWeb staff reporter

NEW YORK (GenomeWeb News) – Investment firm Mizuho initiated coverage of Myriad Genetics on Thursday, calling the Salt Lake City firm "the crown jewel in personalized medicine."

In a report, analyst Peter Lawson initiated coverage with an "outperform" rating and a 12-month target share price of $25, or about 22 percent above the current stock price.

On Thursday, Myriad shares closed at $20.83.

Lawson noted in his report that high barriers of entry, such as marketing, scale, market dominance, clinical utility, and clinical acceptance are threats to new entrants in the space. While Myriad is currently embroiled in gene-patent litigation and last March a federal court ruled that the company's BRCA gene patents were invalid, Lawson said such barriers would outweigh "the expected declining value of gene patent protection."

He cited three growth factors for Myriad: further adoption of its BRACAnalysis tests "as it moves deeper into the asymptomatic OB/GYN channel and clinical trials usage"; personalized medicine for chemotherapy for EGFR- and mTOR-inhibitors; and the launches of Prolaris, a prognostic test for prostate cancer, and Panexia for pancreatic cancer.

The launches, he said, is anticipated to drive growth over the next three to five years.

Lawson also said noted opportunities for Myriad in the companion diagnostics space.

"We believe that Myriad is positioned to reap the benefits of being best-in-class, and the upswing in patient segmentation for clinical trials," he said. "The most addressable test in companion diagnostics is the use of BRACAnalysis in drug trials for PARP-inhibitors in breast and ovarian cancer, while Prezeon could also follow BRACAnalysis into clinical trials to assess PTEN status."