Sequenom (SQNM) Bounces on Increased Revenue

Joel Anderson |

Stock in molecular diagnostic and genetics analysis company Sequenom (SQNM) popped on Friday, gaining nearly 25 percent after the release of their financial results for Q3 2013. The company made back much, but not all, of the ground it lost last Thursday after a federal judge invalidated their patent for a method of testing fetuses for Downs Syndrome.

Q3 Earnings Impress

Sequenom reported Q3 revenue of $44 million, a 92 percent year-over-year increase from Q3 2012’s $22.9 million. Diagnostic revenues accounted for 76 percent of that, up from 70 percent in Q2. Driving revenues was Sequenom’s MaterniT21 PLUS Test, which is a blood test for women with a high chance of carrying a fetus with Down syndrome. It’s a non-invasive test that Sequenom claims can detect the chromosomal anomaly that causes Down syndrome as early as 10 weeks into the pregnancy.

"We are proud to report record-breaking revenues for the third quarter, which primarily resulted from the continued adoption of the MaterniT21™ PLUS test," said Chairman and CEO Harry F. Hixson, Jr., Ph.D. "In October, we marked the second anniversary of the launch of Sequenom Laboratories industry-leading noninvasive prenatal test (NIPT) by announcing additional content for our MaterniT21 PLUS test. We began to report the presence of subchromosomal microdeletions and autosomal trisomies for chromosomes 16 and 22. This expansion of the MaterniT21 PLUS test, as part of our Enhanced Sequencing Series, is the result of our continued investment and further validates the importance and value of our pioneering NIPT testing services to health care professionals and their patients."

Court Ruling Still Hurting Stock

However, while the MaterniT21 PLUS test is driving new revenues, Sequenom’s shares are still hurting from news that it would not be able to keep competition out of the market. In another ruling against a pharma company seeking to patent naturally-occurring molecules, Susan Illston, a judge for the United States District Court in Northern California, ruled against Sequenom’s efforts to patent the test. Illston ruled that the test, which detects the fetuses’ DNA in the mother’s bloodstream, relied on a natural phenomenon and could not be patented, citing the Supreme Court June ruling against Myriad Genetics (MYGN) .

Stock in Sequenom fell 22.58 percent after the ruling and, even after today’s spike, it remains down almost 15 percent since that point.

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Companies

Symbol Name Price Change % Volume
SQNM Sequenom Inc. n/a n/a n/a 0
MYGN Myriad Genetics Inc. 17.40 0.41 2.41 954,547
GBAXY Gb Auto Sae S/Adr n/a n/a n/a 0

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