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Genomic Health Inc. Message Board

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  • Any thoughts about the recent Myriad ruling. In the case of the BRA or BRA2 tests the court appears to be re-affirming that MYGN can not patent the use of this genetic sequence for breast and ovarian cancer diagnostic purposes. How does this differ from GHDX's model. Sounds like the BRA sequence is well known and that the analyses of the sequence may not be exclusive to MYGN's lab facility. This is probably the result of the BRA gene test development in conjunction with the Univ. of Penn. Is GHDX's model fundamentally different by the fact that they have not specifically detailed and published the exact genomic sequence used to diagnose say prostate cancer aggressiveness? Is the intellectual property better protected by restricting the analyses of the OncoDX prostate tests to a single lab facility? My read is that if another company does its own research and comes up with a similar or the same genomic sequence they are will free to exploit it without fear of patent infringement suits. This is probably a strong reason for GHDX to restrict the number of lab facilities and to hold employees to to very strict non disclosure requirements.

    I'll look through Annual Reports for more discussion.

    http://www.bloomberg.com/news/2014-12-17/myriad-loses-appeals-court-bid-to-block-breast-cancer-tests-1-.html?cmpid=yhoo

    FL

  • Most analysts are attributing today's selloff to pricing pressure exemplified by Abbievie winning Express Script support for its HCV drug over Gilead's superior drug. This sell off carried over to GHDX. However, GHDX may be in the part of the biotech sector that does well going forward. As I have previously hypothesized, products that squeeze costs out of the system will be well positioned in the future. Biogeneric drugs and genomic testing are two areas that should do well.

    FL

  • Reply to

    The Street Hack Job

    by flatlander_60048 Dec 3, 2014 10:02 AM

    I guess I disagree on several points.

    1) I do not believe that FMR has (had) a board of directors seat at GHDX therefore they are not privy to the same information reviewed by the BB.

    2) Backward looking means a downgrade based on performance metrics developed on data from the past year that does not consider factors/guidance that the company has released for the upcoming year. You can harbor distrust for management but in the year I've been investing in GHDX I have found that they have provided guidance that they have been able to meet. They are now projecting increased revenue and a return to profitability in 2015 (Forward looking not the backward looking #$%$ dished out by the street). I'm inclined to believe this guidance since the market is certainly there for a product that saves overleveraged governments money. GHDX has a track record of developing tests that are superior to their competitors (i.e., the NICE guidance on ONCO DX Breast test). The Street fails to mention the traction in Europe or the 80% repeat sales of the prostate test to urologists that have tried the test. These are forward considerations that mean more than the fact that profitability slipped while they ramped up staffing to support future growth in a huge potential market.

    I think you are more biased then me. I at least will admit that any investor in GHDX needs to determine their exit point if the company does not execute according to the guidance they have provided.

    FL

  • Reply to

    The Street Hack Job

    by flatlander_60048 Dec 3, 2014 10:02 AM

    I don't have a problem in starting a conversation about competition. GHDX is in a rapidly evolving space so we have to stay aware of what competitors are doing. However, lumping the gene hardware makers with those that have identified a specific gene sequence that correlates to outcomes is different. If GHDX gets reimbursement approval in 2015, you can bet that competitors will be interested in acquiring GHDX due to the small market cap and huge potential addressable market.

    Rather than worrying about that poster, I have created a chart that shows the the growth trjectory that the company has told us to expect. If sales do not ramp at 20% next year and the company return to profitability I will probably look to exit my position by early 2016. Much of this is contingent on getting reimbursement. I don't worry about the price of this test since the popential cost savings of an accurate test dwarf the cost of the test. The same thing was said about Exact Sciences colon test (it would be too expensive). The company is up 100% in half a year since reimbursement approval.

    FL

  • Reply to

    The Street Hack Job

    by flatlander_60048 Dec 3, 2014 10:02 AM

    flatlander_ 60048 - the poster arikaycerocks is a clown following me around and taunting GHDX. Ignore it.
    Genomic Health could be wildly profitable tomorrow if they didnt spend so much R& D money ( Felix oversees this branch of he co) . Ducks in a row to the max ,until they hand off the company.
    Good Luck

  • Reply to

    The Street Hack Job

    by flatlander_60048 Dec 3, 2014 10:02 AM

    There are certainly a lot of unknowns and competition is a factor that no investor can afford to ignore. However, The Baker Brothers continue to make GHDX one of their largest holdings. So I have to believe that they have seen data that makes them believe that GHDX has an opportunity for GHDX to outmaneuver the competition you reference.

    My entire point is that the Street downgrade is backward looking. We should have answers in the next year whether GHDX is moving along the path that will allow them to quadruple sales in the next 5 years and achieve sustained profitability.

    FL

  • Reply to

    The Street Hack Job

    by flatlander_60048 Dec 3, 2014 10:02 AM

    Thanks for taking the time to formulate a thoughtful response. The ramp of R&D and SG&A in 2013 coincides with the launch of of OncoDX Prostate and the expansion in western Europe. The next year is critical in deciphering whether the costs are bearing fruit. GHDX says top line growth will increase to 20% in 2015 and the company will return to profitability in the 2nd half of 2015. This would appear to be heavily based on receipt of reimbursement coding for the prostate test. However, the validation studies by reputable top notch health institutions support the test. So I do not have any reason to suspect that GHDX will not win reimbursement approval. Do you?

    How many other prostate specific tests have been approved for medicare reimbursement? Any of the potential competitors you have mentioned have approval for a test that helps make monitored surveillance of the disease a viable course of action? I think that MYGN has the first test. GHDX has inferred that some of these other tests are subject to false negatives due to sample heterogeneity. This could be detrimental to a patient. While I do not believe that GHDX has any patent protection that inhibits competitors (for the same reason that the supreme court struck down previous MYGN's attempts to patent its products), I believe the analysis of samples at only its facilities provide a degree of protection of their intellectual property. Here is where we differ. I believe that GHDX has a track record of developing superior tests. The OncoDX breast cancer test is the only one to be sanctioned by NICE for use in determining the benefits of chemotherapy. I'm waiting to see head to head testing that says that GHDX is superior to other tests in answering treatment questions. If I wait till this data is available the company will have a market Cap way north of $1B. There is very little float so GHDX will move quickly on news. Look at how Exact Sciences exploded when they received medicare coverage.

  • Reply to

    The Street Hack Job

    by flatlander_60048 Dec 3, 2014 10:02 AM

    I fear you're clutching at straws in suggesting the Street didn't do its homework. The trend in recent years has been increasing costs and decreasing profits:

    Period ..... R&D / SG&A ... Nett profit / loss

    2010 .......... 140 million .... 4 million profit

    2013 .......... 230 million ... 12 million loss

    Last 4 Qs ... 250 million ... 27 million loss

    It should come as no surprise if the market now prices GHDX as a high-risk investment. Given the formidable competition, what makes you so sure of market penetration commensurate with such a massive outlay?

    "In addition, companies offering capital equipment and kits or reagents to local pathology laboratories represent another source of potential competition. These kits are used directly by the pathologist, which facilitates adoption more readily than tests like ours that are performed outside the pathology laboratory.

    In addition, few diagnostic tests are as expensive as our Onco type DX tests.

    We also face competition from companies that offer products or have conducted research to profile genes, gene expression or protein expression in breast, colon or prostate cancer, including public companies such as, GE Healthcare ... Novartis AG ...

    We face competition from commercial laboratories with strong distribution networks for diagnostic tests, such as Laboratory Corporation of America Holdings ...

    We may also face competition from Illumina, Inc. and Thermo Fisher Scientific Inc., both of which have announced their intention to enter the clinical diagnostics market.

    Other potential competitors include companies that develop diagnostic tests such as Roche Diagnostics ... , Siemens AG and Veridex LLC, a Johnson & Johnson company ...

    In our newly established prostate cancer market, we face comparatively greater competition than in our breast cancer market, including competition from products which were on the market prior to our product launch and which are supported by clinical studies and published data."

  • The Street downgrade today is a complete hack job. Kramer is always preaching that you must do homework. Well the Street did not do their homework. The downgrade is primarily based on the backward looking bottom line earnings softness and it neglects the fact that the company has launched the OncoDx prostate line and incurred considerable staffing, marketing, validation study related costs for this new product. Costs have also been incurred to set up a beachhead in Europe. The company has projected mid 20% top line growth starting in 2015 and that the launch costs will subside and the company will return to profitability. This new opportunity is huge and definitely warrants the investment that GHDX has made.

    The Street downgrade is totally backward looking, it is trying to create weakness that might provide a more attractive entry point.

    FL

  • Who knows? For sure somebody who has WAY too much invested in GHDX fears the worst.

    I thought I'd misremembered at first. But the removal of two attempts now to discuss the implications of Fidelity's sell-off of GHDX smells of soiled pants. When a fund of FMR's stature sells 49% of its holding in just six months only a fool would try to conceal the news.

  • rtq- $37.74 but the volume is minuscule. So we did the ladder, Why they let it go now we will know soon....

  • of course not, you expect documentation?- ) This discussion was one I had with management. As I posted ,if GHDX can get rule changed that before you spend gazllions you get a genomic test, this stock will explode. You would think Insurance co's would be all over this so the resistance has to be very high . Good Luck

  • Oncology doctors , breast surgeons and many others are significantly EXPANDING their use of these tests and eventually CMS will mandate them prior to any surgery. Bad for medical oncologists in the short term, GREAT for GHDX. Baker Brothers know a good investment when they see one and so do I. This is going MUCH higher over time. Takes patience sometimes.

  • Do you have any back up to document that chemo physicians are resisting medicare reimbursement for the prostate test. Certainly they stand to loose money from a reduction in the rates of over-treatment. However, I'm unaware of any organized resistance.

    FL

  • or ..will got to the $36 range again and start the cycle all over again - ) .. The payment reimbursement in the US ( medicare ) ruling is hitting major resistance from those who stand to lose ( chemo physicians etc). If when that is resolved , the share price and perhaps the company - ) will be a distant memory quickly Good Luck

  • Its time to buy GHDX before bullish ER...price is creeping up but you still have enough gains ahead ...revenue will increase faster from here on with more products to sell and maturing payment system in place

  • announced that the company will host a conference call and webcast on Tuesday, November 4 at 4:30 p.m. Eastern Time to discuss its third quarter 2014 financial results

GHDX
32.69+1.37(+4.37%)Jan 26 4:00 PMEST

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