Exact Sciences Stock Forecast: A diagnosis of cancer is one of the most terrifying that patients can receive – and their anxiety is well-founded. Cancer in all its forms killed an estimated 9.6 million people worldwide in 2018, and globally, it is the second leading cause of death.
Colorectal cancer is particularly deadly. Only lung cancer and breast cancer surpass it as a cause of death globally. In 2018, 1.80 million cases of colorectal cancer were identified, and that same year, 862,000 patients died from the disease.
In the United States, colorectal cancer is the second leading cause of cancer deaths. According to statistics, one in every 20 US residents will receive a colorectal cancer diagnosis in their lifetime. For many, the diagnosis will come too late for effective treatment.
The biggest issue in colorectal cancer is the screening method. Colonoscopy can identify signs of the disease early enough to ensure a positive outcome. By some estimates, 60 percent of deaths due to colorectal cancer could be prevented with early detection. Unfortunately, due to the test’s expense and invasive nature, and one out of every three people are not up-to-date with their screenings.
Exact Sciences Corporation is a biotech dedicated to the fight against colorectal cancer. It is specifically focused on prevention and early detection of the disease as a solution for reducing mortality. To date, the company has had some notable successes towards this goal.
For investors, the question is: does the current share price reflects those successes and potential for future breakthroughs, or is there room for additional growth? If there is, Exact Sciences Corporation stock could be a smart buy.
How Exact Sciences Fights Colorectal Cancer
Exact Sciences Corporation [NASDAQ: EXAS] is a pioneer in molecular diagnostics. This branch of science explores the opportunities offered by personalized medicine.
Specifically, molecular diagnostics analyzes biological markers in the proteome and genome – patients’ individual genetic codes and how cells demonstrate genes as proteins.
Exact Sciences works to apply molecular biology to medical testing for the purpose of diagnosing and monitoring colorectal cancer. In the future, researchers expect molecular diagnostics to offer guidance in treatment methods, as the science should point to specific therapies that will be most effective for individual patients.
Exact Sciences had a major win in 2014, when the FDA approved Cologuard – a non-invasive stool DNA screening test for colorectal cancer. This marked the FDA’s first-ever approval of a technology that was immediately proposed for national coverage by the Centers for Medicare & Medicaid Services (CMS).
Cologuard is a breakthrough in the diagnosis and treatment of colorectal cancer, because it offers an opportunity for patients to participate in screening without an uncomfortable, invasive colonoscopies.
Instead, physicians prescribe the test, and a kit is shipped to patients’ homes. There is no need for medication, bowel prep, or special diet in advance of the test. Patients collect their samples at home, then send them to a lab where the screening is completed.
Cologuard proved to be highly accurate in clinical trials. In fact, results were so accurate that the test need only be performed once every three years, rather than the recommended annual schedule for most fecal tests. It costs less than a colonoscopy, and because it is performed more frequently than a colonoscopy, it may lead to earlier diagnosis and more successful treatment of colorectal cancers.
Perhaps most important, Cologuard promises consistent results, since it is a straightforward matter of testing a sample.
Studies show that there is no statistically significant variability in results. This differs dramatically from colonoscopy results, which rely on the skill and experience of the operator. Researchers determined that colonoscopy results vary widely between operators, even if the same patient is being tested
At first, Cologuard was only approved for patients age 50 and up. However, rising colorectal cancer rates in younger patients prompted a change to that guidance in September 2019.
Today, Cologuard is approved for eligible average-risk patients 45 and older. The medical community is hopeful that this update will lead to early identification of cancer for more patients.
This success has inspired the company to go after ever-more-ambitious goals. In partnership with the world-renowned Mayo Clinic, Exact Sciences Corporation [NASDAQ: EXAS] is working on new liquid biopsy tests. These screening tests will identify 15 or more cancers at the very earliest stages by analyzing DNA biomarkers in the blood.
The project is progressing well, particularly in the area of identifying and monitoring liver cancer. The company hopes to transform the process of diagnosing and treating many forms of cancer in coming years.
Is Exact Sciences Corporation a Buy?
In the past 10 years, Exact Sciences’ share price has increased by almost 6,000 percent, thanks to its frequent successes.
In the first two months of 2019, share prices went up by an impressive 40 percent, in part because the company announced plans to request approval for Colonguard at age 45 instead of 50.
Business leaders and industry experts believe the expanded age range could add up to $4 billion in sales for Exact Sciences.
Aside from new revenues that may be generated by Colonguard, the company’s pipeline gives investors reason to believe more growth is coming. The potential for liquid biopsy in particular is astronomical.
Exact Sciences expects the liquid biopsy market to hit $13 billion by 2030, but that could be overly conservative. Some projections indicate that the liquid biopsy market could top $100 billion for all types of cancer.
Exact Sciences Stock Forecast & Acquisitions
Exact Sciences Corporation [NASDAQ: EXAS] has important projects in its pipeline, but business leaders aren’t settling for that limited list. They are also carefully monitoring developments in other companies that could complement Exact Sciences’ work. This led to the decision to acquire Genomic Health for $2.8 billion.
Investors were initially unhappy with the transaction, as evidenced by a drop in share prices shortly after the announcement. However, those prices rapidly recovered once it became clear how important the acquisition could be.
With the purchase of Genomic Health, Exact Sciences gets the Oncotype DX suite of tests for prostate, breast, and colon cancers. These tests give critical information about the nature of individual cancers once a patient has been diagnosed.
With data from the Oncotype DX, oncologists have a better understanding of how the cancer will behave, making it possible to customize therapies and improve overall rates of treatment success.
These developments have most investors and analysts convinced that Exact Sciences Corporation [NASDAQ: EXAS] is a smart buy.
The few naysayers question whether the company can withstand competition once new, more advanced tests are released by other biotechs.
All in all, considering Exact Sciences’ track record of success, there is every reason to think more breakthroughs are coming – and this could be the best possible chance to buy stock before share prices skyrocket.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.