The world of colorectal
cancer screening may not be the most “extravagant” place to invest;
nevertheless, the industry does offer some opportunities. Exact Sciences is one
of those opportunities. This small-cap biotech company has developed a
screening test for colorectal cancer which is expected to face the FDA “panel”
in March. This $100 million dollar industry could find favor with EXAS as it
introduces the first screening that is able to detect both cancerous and
pre-cancerous cells. There are no other tests out there with this claim.
Screening in the Key
Colorectal cancer is
supposed to be the most preventable type of cancer yet it is the least
prevented. 50,000 people died from this type of cancer last year and another
140,000 in the United States were diagnosed with it.
Unfortunately, more than
half the time the cancer isn’t detected until it is in its later stages which
makes it difficult and often expensive to treat. Early detection is the key to
fighting this type of cancer and it begins with simple cancer screening.
All colon cancers start as
polyps and those polyps shed cells into the stool stream and some of these
cells contain altered DNA. Exact Sciences stool DNA test analyzes for molecular
alterations associated with cancerous or precancerous conditions in the colon
and rectum. If an abnormal DNA test is identified, patients are then referred
for a colonoscopy. It’s a very simple and patient friendly procedure with no
dietary restrictions. The test is available in the United States currently under
regulatory review by the FDA.
There are a few types of
stool-based colorectal cancer screening tests presently. They are non-invasive,
but they do not detect pre-cancer cells like the Exact Sciences stool DNA test
does.
The Product
Exact Sciences’ screening
test to detect clorectal cancer is called “Cologuard.” In its preliminary
analysis, it met or exceeded all primary and secondary endpoints of its DeeP-C
pivotal clinical trial. The purpose of the trial was to evaluate the test’s use
for detection of the cancer and pre-cancerous polyps.
The screen demonstrated 92%
sensitivity to the detection of cancer and 42% for the detection of
pre-cancerous polyps. Polyps that were 2 cm or greater in size had a 66%
sensitivity. The trial was quite large including 10,000 patients between the
age of 50 and 84 who are considered average risk for colorectal cancer.
Thomas F. Imperiale, M.D.,
professor of medicine, a member of IU Simon Cancer Center, had this to say
about the results of Cologuard’s trial results: “There is significant unmet
clinical need for an accurate, convenient and non-evasive colorectal screening
test. The data from the DeeP-C trial are very promising. Cologuard may well be
a future solution for identifying slow growing polyps much before they develop
into cancer.”
Exact Sciences will submit
data from the DeeP-C study to the U.S. Food and Drug Administration as part of
its pre-market approval (PMA) submission. It is considered an investigative
device, not available for sale in the United States. This testing information
is strictly preliminary, pending any additional analysis by the company or
review by the FDA.
Market Potential
Roughly 5% of men and women
in the United States will be diagnosed with colorectal cancer in their
lifetime. More than 80% of the cancer arises from polyps which are amiable to
screening. Diagnosing the case through screening usually occurs 2 to 3 years
before a case with symptoms and has the potential to reduce deaths from
colorectal cancer by 60%. This being said, there is a huge drive to continue to
encourage colorectal screening.
The adult population in the
United States is roughly around 224 million people. This means about 11 million
of these people will be diagnosed with colorectal cancer in their lifetime.
Although there are currently three types of screening available, patients would
likely opt for Cologuard given the simplicity of the screen as well as its
unique ability to detect pre-cancerous cells.
EXAS testing is far superior
to the present fecal tests (FOBT & FIT) which in themselves are
considerably less accurate and nowhere near as good as a colonoscopy. While a
colonoscopy can cost well over $1,000, the standard stool tests are just under
$50. Cologuard is roughly in the middle at a cost of between $300-$500. Since
it is so effective and cost-efficient, it has a potential to take the place of
a colonoscopy recommendation to start with. A test once every three years would
not be as expensive or evasive as a colonoscopy.
In a market with good
residual potential, don’t be surprised if 2014 sees the stock price rising as
the FDA meets about licensing the test.
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Sign up for “The Mission Report” at www.MissionIR.com
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