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Veracyte, Rosetta Genomics, NanoString Lead Decliners as Life Science Tools/Omics Stocks Decline in April

NEW YORK (GenomeWeb) – Veracyte, Rosetta Genomics, and NanoString Technologies led a lineup of firms in the GenomeWeb Daily News Index that saw their share prices retreat in April, as the Index took a 5 percent hit during the month.

Overall, stocks for 22 of the 29 companies in the Index dropped in April with Veracyte (-25 percent), Rosetta Genomics (-24 percent), and NanoString (-21 percent) pacing the decliners. The gainers were led by Myriad Genetics (+23 percent) and Sequenom (+11 percent) as the only two firms with double-digit percentage increases in April.

While the broader markets were soft during the month, the GWDN Index performed even worse. The Dow Jones Industrial Average inched up a fraction of 1 percent month over month in April, while the Nasdaq was down 2 percent, and the Nasdaq Biotech Index shed 3 percent.

April also continued a downward trend for the Index, which dropped more than 3 percent in March.

Veracyte's shares fell even though the company reported no news in April and in spite of a positive outlook from Leerink Partners analyst Dan Leonard, who wrote in a note mid-month that the company has "a number of near-term catalysts, which could improve stock sentiment." He maintained an Outperform rating for Veracyte with a $23 price target on its stock.

Rosetta Genomics was the biggest riser in the GWDN Index in March but returned all of its gains in April. The Rehovot, Israel-based firm is primarily a developer of miRNA-based diagnostics but also recently reiterated its commitment to developing therapeutics, which could explain its share-price dip. RNA- and miRNA-based drug companies have seen a downturn in their share prices in recent months, which an analyst told Gene Silencing News is a steadying of the ship that could set the stage for a rise in the broader biotech space in the next few years.

Meanwhile, NanoString said at the start of April that it had reached a loan agreement for up to $45 million. Investors responded the day after the firm disclosed the deal by selling off NanoString's shares, resulting in a one-day decline of 7 percent.

Early in April, the company also launched its nCounter PanCancer Pathways Panel, a multiplexed digital gene expression assay, but investors again sold off shares of the firm, leading to a one-day drop of almost 12 percent in NanoString's stock price.

The most notable gainer in the GWDN Index last month was Myriad Genetics, whose shares rebounded from a decline of more than 5 percent in March. The Salt Lake City firm benefitted from a decision by the US Centers for Medicare and Medicaid Services in early April to restore a significant portion of the reimbursement rate for Myriad's BRACAnalysis test. Mizuho Securities reacted to the news by upgrading its rating on the company to Buy and increasing Myriad's 12-month price target to $50.

Additionally, the company submitted a premarket approval application to the US Food and Drug Administration for BRACAnalysis as a companion diagnostic test for AstraZeneca's breast cancer PARP inhibitor olaparib.

Lastly, Sequenom received positive news in mid-April when the US Patent and Trademark Office made rulings that the company said were favorable to it in its ongoing patent dispute with Illumina's Verinata Health regarding non-invasive prenatal testing. The USPTO's Patent Trial and Appeal Board ruled on four patent interference proceedings between patents licensed exclusively to Sequenom and patents licensed to Verinata. In three cases, the board ruled against Stephen Quake, a professor at Stanford, which licensed his NIPT technology to Verinata. In one other case the board ruled in favor of Dennis Lo from the Chinese University of Hong Kong, who invented the technology underlying Sequenom's MaterniT21 Plus NIPT.