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Quest Diagnostics' (DGX) New Buyout Expands Cancer Portfolio
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Quest Diagnostics, Inc. (DGX - Free Report) recently completed its previously-announced acquisition of Haystack Oncology. The acquisition is intended to improve patient outcomes through early, accurate detection of residual or recurring cancer.
Based on circulating tumour DNA (ctDNA), Haystack Oncology created a highly-sensitive minimal-residual disease (“MRD”) testing tool to help with the early detection of residual or reoccurring cancer and to better guide treatment choices. This MRD technology will be used by Quest Diagnostics to create new blood-based clinical lab services for solid tumour cancers that will be made available starting in 2024.
The latest move will expand Quest Diagnostics’ portfolio of cancer services, fortifying the Diagnostic Solutions business.
About Haystack Oncology
In order to report residual, recurring, or resistant disease earlier than other MRD tests, Haystack Oncology uses the most advanced ctDNA detection technology to cut through the clutter and identify the lowest quantities of ctDNA in blood.
Strategic Implications
The acquisition of Haystack is a significant step toward transforming two decades of top-tier liquid biopsy research and development into clinical laboratory services that are incredibly dependable and widely available. By combining its strengths in screening, pathology and sequencing with Haystack's liquid biopsy technology, DGX will likely dominate the rapidly expanding MRD sector.
Image Source: Zacks Investment Research
The acquisition will leverage Quest Diagnostic's capabilities and size in pathology, genomics, and oncology. Through its AmeriPath specialist pathology-diagnostics division, Quest Diagnostics employs around 400 pathologists and has over 7,000 patient access points for the collection of blood and other specimens in the United States. The ability to find patient-specific mutations for Haystack's tumor-informed MRD strategy is another aspect of Quest Diagnotics’ proficiency in next-generation tumour sequencing.
Industry Prospects
Per a report by Grand View Research, the global minimal residual disease testing market size was estimated at $1.89 million in 2022 and is expected to expand at a CAGR of 11.45%. The minimal residual disease testing market is witnessing growth due to the increasing prevalence of cancer, increasing consumer awareness for therapy and increasing funding for research with an increasing disposable income in emerging economies.
Recent Developments
This month, Quest Diagnostics partnered with Coriell Life Sciences to provide select medical plan members with pharmacogenomics testing services. The test indicates how different genes and their variants affect an individual’s reaction to drugs. The pharmacogenomics test is a voluntary, no cost DNA-testing programme that uses a saliva collection kit that can be used at home to analyze a person's DNA. The effectiveness of the patient's existing drugs is evaluated in light of the test results. The test results can improve pharmaceutical effectiveness and safety and also assist in selecting the appropriate drug and dosage. Through testing, each patient receives personalized, actionable clinical recommendations and drug management regimens.
In May 2023, Quest Diagnostics announced that the RestoreU Dementia Panel, a risk assessment and care plan service developed by uMETHOD Health, a health technology company specializing in precision medicine for chronic diseases, would be made available nationwide. This would enable doctors to fill in any care gaps for patients with cognitive decline. The RestoreU service uses artificial intelligence (AI) created by uMETHOD to build personalized care plans that support cognitive care standards and aid clinicians in providing better patient care.
Price Performance
Shares of the company have gained 2.9% in the past year against the industry’s fall of 5.1%.
Zacks Rank and Key Picks
Quest Diagnostics carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , Merit Medical Systems, Inc. (MMSI - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic has gained 15.3% compared with the industry’s 11.3% rise in the past year.
Merit Medical, carrying a Zacks Rank #2, has an estimated long-term growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 20.2%.
Merit Medical has gained 54.6% compared with the industry’s 20.3% rise in the past year.
Boston Scientific, carrying a Zacks Rank #2, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 46% against the industry’s 21% decline in the past year.
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Quest Diagnostics' (DGX) New Buyout Expands Cancer Portfolio
Quest Diagnostics, Inc. (DGX - Free Report) recently completed its previously-announced acquisition of Haystack Oncology. The acquisition is intended to improve patient outcomes through early, accurate detection of residual or recurring cancer.
Based on circulating tumour DNA (ctDNA), Haystack Oncology created a highly-sensitive minimal-residual disease (“MRD”) testing tool to help with the early detection of residual or reoccurring cancer and to better guide treatment choices. This MRD technology will be used by Quest Diagnostics to create new blood-based clinical lab services for solid tumour cancers that will be made available starting in 2024.
The latest move will expand Quest Diagnostics’ portfolio of cancer services, fortifying the Diagnostic Solutions business.
About Haystack Oncology
In order to report residual, recurring, or resistant disease earlier than other MRD tests, Haystack Oncology uses the most advanced ctDNA detection technology to cut through the clutter and identify the lowest quantities of ctDNA in blood.
Strategic Implications
The acquisition of Haystack is a significant step toward transforming two decades of top-tier liquid biopsy research and development into clinical laboratory services that are incredibly dependable and widely available. By combining its strengths in screening, pathology and sequencing with Haystack's liquid biopsy technology, DGX will likely dominate the rapidly expanding MRD sector.
The acquisition will leverage Quest Diagnostic's capabilities and size in pathology, genomics, and oncology. Through its AmeriPath specialist pathology-diagnostics division, Quest Diagnostics employs around 400 pathologists and has over 7,000 patient access points for the collection of blood and other specimens in the United States. The ability to find patient-specific mutations for Haystack's tumor-informed MRD strategy is another aspect of Quest Diagnotics’ proficiency in next-generation tumour sequencing.
Industry Prospects
Per a report by Grand View Research, the global minimal residual disease testing market size was estimated at $1.89 million in 2022 and is expected to expand at a CAGR of 11.45%. The minimal residual disease testing market is witnessing growth due to the increasing prevalence of cancer, increasing consumer awareness for therapy and increasing funding for research with an increasing disposable income in emerging economies.
Recent Developments
This month, Quest Diagnostics partnered with Coriell Life Sciences to provide select medical plan members with pharmacogenomics testing services. The test indicates how different genes and their variants affect an individual’s reaction to drugs. The pharmacogenomics test is a voluntary, no cost DNA-testing programme that uses a saliva collection kit that can be used at home to analyze a person's DNA. The effectiveness of the patient's existing drugs is evaluated in light of the test results. The test results can improve pharmaceutical effectiveness and safety and also assist in selecting the appropriate drug and dosage. Through testing, each patient receives personalized, actionable clinical recommendations and drug management regimens.
In May 2023, Quest Diagnostics announced that the RestoreU Dementia Panel, a risk assessment and care plan service developed by uMETHOD Health, a health technology company specializing in precision medicine for chronic diseases, would be made available nationwide. This would enable doctors to fill in any care gaps for patients with cognitive decline. The RestoreU service uses artificial intelligence (AI) created by uMETHOD to build personalized care plans that support cognitive care standards and aid clinicians in providing better patient care.
Price Performance
Shares of the company have gained 2.9% in the past year against the industry’s fall of 5.1%.
Zacks Rank and Key Picks
Quest Diagnostics carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , Merit Medical Systems, Inc. (MMSI - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic, carrying a Zacks Rank #2 (Buy), has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 15.3% compared with the industry’s 11.3% rise in the past year.
Merit Medical, carrying a Zacks Rank #2, has an estimated long-term growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 20.2%.
Merit Medical has gained 54.6% compared with the industry’s 20.3% rise in the past year.
Boston Scientific, carrying a Zacks Rank #2, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 46% against the industry’s 21% decline in the past year.