What happened
Shares of Invitae (NVTA +0.00%) roared as much as 37% higher early Monday, then settled to trade up 13% as of 3 p.m. ET after the U.S Food and Drug Administration (FDA) authorized marketing efforts by Invitae for its groundbreaking gene-based test for cancer risk.
OTC: NVTA
Key Data Points
So what
In a press release dated Friday, Sept. 29, the FDA announced it has granted De Novo marketing authorization for the Invitae Common Hereditary Cancers Panel, an in vitro diagnostic test that evaluates DNA extracted from a blood sample to detect hundreds of genetic variants associated with an elevated risk for developing certain cancers. The test was reviewed under the FDA's De Novo premarket review pathway -- a regulatory path for low- to moderate-risk devices of a new type -- and is the first of its kind to be granted FDA marketing authorization.
Now what
This is an obvious win for Invitae as it seeks to continue expanding the reach and utilization of its various hereditary cancer panel offerings. But the company still has plenty of work to do; during its most recent earnings conference call in August, Invitae management cited a recent study showing that of 1 million patients diagnosed with cancer in California and Georgia, around 93% did not receive hereditary cancer testing despite guidelines endorsing universal germline testing for several tumor types.
"This growth underutilization suggests many patients who are eligible for germline testing have not yet received it," stated Invitae CEO Ken Knight during the company's second-quarter earnings call. "This is the burning issue to solve and underscores our current efforts to drive education and additional call points at the community oncology level."
Considering this leading genetic testing stock is simultaneously working to remain compliant with NYSE listing requirements, as its share price has hovered below the $1.00 minimum for over a month now -- and noting every bit of positive news helps -- it's not terribly surprising to see Invitae rallying right now. At the same time, this likely won't have an immediate positive impact on Invitae's top or bottom lines, which explains the quick pullback from its earlier highs.
