Exact Sciences has already set plans in place to try to benefit from new guidelines from the American Cancer Society, which is lowering the recommended age at which patients should first get screened for colorectal cancer from 50 to 45.
Fully realizing that objective, however, is still going to take plenty of time and money, according to industry analysts.
The ACS’s decision Wednesday sent shares in Madison, WI-based Exact (NASDAQ: EXAS) up by more than 11 percent that day, to $58.58 apiece. The stock traded at $59.54 a share when the closing bell rang on Thursday.
Exact sells a non-invasive screening test for colorectal cancer, and analysts say the ACS’s new guidelines could have positive long-term implications for the company. However, Exact would need to run at least one clinical trial for lower age groups in order to get FDA approval to screen patients younger than 50, Catherine Schulte, a senior research analyst at Robert W. Baird & Co., wrote in a research note published Wednesday.
The company “is currently working on the trial design for an FDA supplement to expand the indicated age on Cologuard’s label, but hasn’t started the trial yet,” she said.
Cologuard received clearance from the FDA and Centers for Medicare and Medicaid Services (CMS) in 2014, and more than 1.1 million patients have been screened with the test, according to Exact.
The company has been on something of a hot streak since mid-2016, when the U.S. Preventive Services Task Force, whose statements and guidelines are watched closely within the healthcare industry, announced changes to how it classifies colorectal cancer screening methods. In a statement published in a leading medical journal, the task force said it was including Cologuard in its list of recommended tests for colorectal cancer screening.
Exact said on Wednesday that there is an increased need for testing. In a news release applauding the ACS’s decision, the company cited research showing rates of colorectal cancer in patients younger than 55 have increased in recent decades.
“Among adults younger than 55 years, there was a 51 percent increase in the incidence of colorectal cancer from 1994 to 2014 and an 11 percent increase in mortality from 2005 to 2015,” according to the release.
Colonoscopy is still generally considered the gold standard when it comes to colorectal cancer screening. One reason is that it’s both diagnostic and therapeutic; healthcare providers find potentially cancerous or pre-cancerous polyps during a procedure, remove them, and send them to a lab for further analysis.
However, some patients are wary of getting a colonoscopy because it’s a costly and invasive procedure that carries some risk. Cologuard, by contrast, involves sending a stool sample to Exact’s lab. The next step for most patients who receive a positive Cologuard result is a colonoscopy. In January, CMS set a three-year reimbursement rate for Cologuard at $508.87 per test, according to a document filed with federal securities regulators.
The ACS emphasized the importance of giving patients different screening options in its explanation for the change to its guidelines.
“Although prevention is highly valued by patients, test preparation, invasiveness, potential costs, and other considerations will lead some patients to prefer a non-colonoscopy test for screening,” according to the ACS’s guideline update. “Greater value was placed on the role of patient preferences and on the potential to increase [colorectal cancer] screening utilization through offering choice in screening test options.”
In her note, Schulte added that, “rather than prioritizing certain tests, the new guidelines … Next Page »