NEW YORK (GenomeWeb News) – With uncertainty over future National Institutes of Health funding and concerns over austerity measures in Europe, investors have recently cooled on the stocks of genomics tools firms.
Following a strong January and modest gains for the remainder of the first quarter, the stocks of genomics tools firms and some molecular diagnostics companies have slumped over the past couple of months, though part of that can be attributed to bearish trends in the broader stock market.
For May, the GenomeWeb Daily News Index, which tracks the stocks of 30 firms in the tools and MDx spaces, was down around 3 percent. But that figure is worse when Rosetta Genomics, which saw a greater than 500 percent rise in its stock during the month, is removed from the equation.
Overall, only four of the 30 stocks in the GWDN Index finished up for the month. But the 3 percent drop in the Index wasn't as dramatic as the 6 percent decline for the Dow Jones Industrial Average or 7 percent decline for the Nasdaq. The Nasdaq Biotech Index was down 2 percent for the month of May.
Bucking the trend, Rosetta Genomics' shares jumped 555 percent for the month. The firm started off the month under threat of delisting from Nasdaq due to not meeting two of the listing requirements.
However, its fortunes on the market changed with an announcement on May 16 that a designated Medicare contractor had informed the firm that it plans to cover its miRview mets2 assay for all Medicare beneficiaries. On that news, the firm's shares spiked 200 percent in a single day, which was followed last week by another sharp increase. Also, the firm said yesterday that as a result of the increase in its stock price, which followed a one-for-15 reverse stock split on May 15, it has been notified by Nasdaq that it meets one of the listing requirements — the $1 minimum bid requirement — for which it previously was deficient.
Other than Rosetta, the only firm in the Index to see its stock rise in the double digits was Genomic Health, up 18 percent for May.
Several stocks in the GWDN Index had double-digit percentage declines for the month led by Sequenom, which dropped 25 percent. On May 9, the firm announced that health insurance provider Coventry Health Care National Network would provide coverage for its MaterniT21 test. But a week later, Sequenom said that Coventry had terminated the coverage agreement, which lead to sell off in the firm's shares.
Among the other stocks that had a double-digit decline for the month were those of Complete Genomics (-14 percent), Pacific Biosciences (-13 percent), Life Technologies (-12 percent), and Luminex (-12 percent).
In the table below, Rosetta's April 30 closing price has been adjusted to reflect the firm's one-for-15 reverse stock split on May 15.