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Alere Inc. (ALR - Snapshot Report), a medical products company focused on integrating rapid diagnostics with health management, launched a new campaign called the Test Target Treat in response to a report released by the World Economic Forum (WEF) identifying antimicrobial resistance (AMR) as the greatest threat to human health. The campaign was launched at the 9th Annual International Symposium on Antimicrobial Agents and Resistance.

The misuse of antibiotics has led to microorganisms mutating or acquiring resistance genes that empower them to resist antimicrobial treatments, which were earlier effective. In the 2013 Global Risks Report, the WEF has urged healthcare professionals to prevent the overuse of antibiotics in an effort to stop this huge global health crisis.

The aim of the Test Target Treat is to spread awareness amongst doctors that antibiotics are being over-prescribed in half of all the cases. Alere has developed the Alere Afinion CRP Test that helps physicians identify respiratory tract infections that require medication. This in turn allows for more quicker and targeted treatment decisions that can reduce the use of antibiotics. The company also offers easy-to-use diagnostic tools that help in early detection of diseases like Strep A, RSV, Influenza, S. pneumoniae, MRSA and C. difficile and others.

Our Take

Mass.-based Alere caters to patient health by providing diagnostic tools and services that increase patient awareness for self-management. It has a wide portfolio of rapid diagnostic and monitoring products to improve clinical outcomes. The company aims to be the leader in rapid ‘near-patient’ or point-of-care testing (POCT) or diagnostics. We believe that this campaign should support Alere’s strategy to shift focus from over-prescription of antibiotics toward more targeted therapy.

However, Alere is plagued by margin pressure. The company has been reporting losses for quite sometime. Further, its heavy reliance on acquisitions has led to substantial indebtedness. Alere needs to successfully integrate the acquired entities to avoid wastage of resources.

Alere carries a Zacks Rank #4 (Sell). Companies like Nuvasive Inc. (NUVA - Snapshot Report), carrying a Zacks Rank #1 (Strong Buy), as well as Edwards Lifesciences (EW - Analyst Report) and Hanger Inc. (HGR - Analyst Report), which carry a Zacks Rank #2 (Buy), are expected to do well in the medical industry.

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