Hologic, Inc. HOLX recently received the FDA’s Emergency Use Authorization (EUA) for its Panther Fusion SARS-CoV-2 assay. The assay will be used to test asymptomatic (without symptoms) individuals and those having symptoms of the COVID-19 infection.
Additionally, the FDA has authorized Hologic’s pooling protocol, which was announced on Aug 11, for symptomatic testing with the Panther Fusion SARS-CoV-2 assay. For investors’ note, Hologic is also pursuing an EUA for asymptomatic testing for its Aptima SARS-CoV-2 assay, which is another molecular diagnostic test for COVID-19.
A key characteristic for a test to be used effectively in asymptomatic screening and pooling workflows is its high analytical sensitivity. A recent report by the FDA has compared more than 50 COVID-19 tests and established that Hologic’s assays are the most analytically sensitive of the fully automated high-throughput molecular tests currently available in the market.
With the recent regulatory approval, Hologic is expected to strengthen its Diagnostics business on a global scale.
Significance of the Approval
Per management, the early detection of infected individuals is critical to check the spread of the pandemic and the high accuracy of molecular testing has made it the gold standard for infectious disease detection. Notably, recent data illustrate that Hologic’s molecular coronavirus tests are among the most sensitive tests currently available.
As Hologic’s assay is the first widely available high-throughput molecular diagnostic test specifically authorized for screening asymptomatic people, the availability of the same is expected to play an important role in identifying early infection in exposed individuals. All these are expected to aid the reopening of schools and workplaces and kick-start the economy in general.
For investors’ note, the FDA authorized the asymptomatic screening claim based on available analytical data as well as Hologic’s assurance to submit results from an ongoing clinical evaluation currently underway with several laboratory partners.
Per a report by Grand View Research, the global molecular diagnostics market was valued at $9.2 billion in 2019 and is expected to reach $18.2 billion by 2027, at a CAGR of 9%. Factors like increasing prevalence of infectious diseases and technological advancements in molecular diagnostics are expected to drive the market.
Given the market potential, the regulatory clearance is expected to significantly boost Hologic’s business globally.
Of late, Hologic has witnessed a series of developments across its businesses.
The company announced this month that its CE-marked Aptima HIV-1 Quant Dx assay has been awarded World Health Organization prequalification for testing of dried blood spot samples.
Hologic, in August, announced the addition of improved features to its Brevera Breast Biopsy System with CorLumina Imaging Technology. In the same month, the company purchased privately-held Acessa Health Inc. with an aim to broaden its foothold in minimally invasive surgical procedures.
Further, in August, Hologic announced a definitive collaboration with RadNet, Inc. to advance the use of artificial intelligence in breast health.
Shares of the company have gained 35.8% in the past year compared with the industry and the S&P 500’s 24.9% and 13.7% growth, respectively.
Zacks Rank & Key Picks
Currently, Hologic carries a Zacks Rank #3 (Hold).
A few better-ranked stocks from the broader medical space include QIAGEN N.V. QGEN, Thermo Fisher Scientific Inc. TMO and Globus Medical, Inc. GMED.
QIAGEN’s long-term earnings growth rate is estimated at 22.3%. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher’s long-term earnings growth rate is estimated at 15.5%. It currently carries a Zacks Rank #2 (Buy).
Globus Medical’s long-term earnings growth rate is estimated at 13%. The company presently carries a Zacks Rank #2.
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