Oct 1 Shares of molecular diagnostics company
Myriad Genetics Inc jumped 13 percent in morning
trading after the company said the proposed cut in Medicare
reimbursement rates for one of its tests was the result of a
Myriad's shares took a hit on Monday after data from the
U.S. Centers for Medicare & Medicaid Services showed a proposed
48 percent pricing cut for the company's tests. The shares
closed down 9 percent.
Myriad said on Tuesday the proposed low numbers were due to
a clerical error and will be corrected. "It may take a week or
two for this correction to be reflected by CMS," Myriad said in
a regulatory filing.
The test, called BracAnalysis, is a test to confirm the
presence of a BRCA1 or BRCA2 gene mutations, which are
responsible for the majority of hereditary breast and ovarian
Companion diagnostics, or tests that help to find the
patients who would best respond to certain drugs, is assuming
increasing importance with advances in genetic screening and
Several drugmakers are now developing cancer treatments
along with companion diagnostics to improve the drug's efficacy.
Myriad said its test will be reimbursed at about $2,795 for
Ladenburg Thalmann analyst Kevin DeGeeter said the payment
rate was in line with investors' expectation.
He also upgraded the stock to "buy" from "neutral," and said
the "the core of MYGN's business remains largely intact."
The CMS had cut the reimbursement payment rate for another
test made by Myriad, called Colaris, but DeGeeter said the
Colaris price decrease was largely priced into Myriad shares.
Colaris helps detect disease-causing genetic mutations that
are responsible for the majority of hereditary colorectal cancer
and uterine cancer.
Myriad shares were up 10.5 percent at $25.97 in morning
trading on the Nasdaq. They touched a high of $26.57 earlier in
(Reporting by Esha Dey in Bangalore; Editing by Don Sebastian)