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Quest Diagnostics (DGX) Launches HBV Quantitative Test

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Quest Diagnostics Inc. (DGX - Free Report) , a global provider of diagnostic information services, recently rolled out Hepatitis B Virus (HBV) Quantitative Test. This helps physicians evaluate a patient's response to drug therapies for HBV infection. The test is first of its kind in the U.S. and will help effectively treat individuals infected with the virus.

Notably, HBV can be transmitted by blood, semen or other body fluid from a person infected with the virus. It is believed chronic Hepatitis B leads to serious health issues, including cirrhosis or liver cancer.

Quest Diagnostics is slated to release fourth-quarter results on Jan 26. The company has been trading above the Zacks categorized Medical - Outpatient and Home Healthcare industry over the last three months. The stock has generated a return of 10.3%, way higher than the industry’s 5.2%. In the recent past, Quest Diagnostics has seen growth in hepatitis diagnostic information testing services that include genotyping, viral load and antiviral resistance testing to aid diagnosis, treatment and monitoring. We believe that the newly launched HBV test would help the company maintain the upside.

Presently, the HBsAg qualitative test is being used to aid in the diagnosis of patients with HBV. The new version not only helps evaluate the patients but also the quantity of viral antigen in blood and the immune system. With this added insight, physicians can monitor patient’s response to antiviral medications and modify or adjust treatment for improving patient immunity.

It is believed that almost 850,000 to 2.2 million individuals in the U.S. are infected with chronic hepatitis B, which is mainly treated with antiviral therapies. Unlike hepatitis C virus infection, in which direct acting antiviral drugs have high success rates, cure rates are lower for HBV due to the persistent nature of the virus and the low compliance rate with long-term therapies. Thus, management claims that due to lack of tools that predict patient’s response to those treatments, it has come up with a comprehensive solution for this problem.

As per a Research & Markets analysis report, the global market for hepatitis diagnostics market is expected to grow at a CAGR of 6.35% by 2020. The key trend for the growth market is expected to be the demand for biomarker-based tests which detect the absence or presence of a disease.

Quest Diagnostics is therefore making efforts to cash in on opportunities in the hepatitis diagnostics space. The company is currently collaborating with the Centers for Disease Control and Prevention (CDC) to identify trends in screening, diagnosis and treatment for viral hepatitis (hepatitis A, B, C and E) in the U.S. based on the national Quest Diagnostics Health Trends database of de-identified clinical hepatitis test data.

Zacks Rank & Key Picks

Quest Diagnostics carries a Zacks Rank #3 (Hold). Better-ranked medical stocks are Penumbra, Inc. (PEN - Free Report) , Neogen Corporation (NEOG - Free Report) and Cardiovascular Systems, Inc. . Penumbra sports a Zacks Rank #1 (Strong Buy) while Neogen and Cardiovascular carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.  

Penumbra surged 61.9% over the last one year compared to the S&P 500’s 21.1%. The company has a stellar four-quarter average earnings surprise of over 100%.

Neogen gained 23.7% in the past one year, better than the S&P 500. The stock has an impressive long-term earnings growth of 16.7% for the next five years compared to the industry average of 15.2%.

Cardiovascular Systems rallied 101.4% in the past one year, way higher than the S&P 500 mark.  It has a positive average earnings surprise of 31.8%.

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