Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Myriad Genetics (NASDAQ:MYGN), a molecular diagnostics company best known for its BRACAnalysis BRCA 1 & 2 gene test, slumped as much as 17% after the Centers for Medicare and Medicaid Services proposed drastic cuts to its Medicare reimbursement rate.

So what: According to the CMS press release, it will hold an open forum for commentary through Jan. 27, but if all goes as proposed, the reimbursement rate for Myraid Genetics' BRACAnalysis gene test will drop by 48.6% to just $1,438 from its current $2,795. Based on figures from Bloomberg, Medicare reimbursements currently make up about 10% of Myriad's total BRACAnalysis gene test sales. Following this news, Myriad was hit with a flurry of downgrades and price target cuts including JMP Securities cutting the company to "underperform," Mizuho Financial cutting Myriad to "neutral" from "buy," and Goldman Sachs lowering its price target to $20 from $32.

Now what: This has been a miserable year for Myriad Genetics' shareholders, and it just keeps getting worse. Earlier this year, U.S. courts invalidated some of its previously key patents that had protected the exclusivity of its BRCA gene test, allowing Quest Diagnostics (NYSE:DGX) and other competitors to introduce competing tests just days later. Now, with the prospect of a major Medicare reimbursement haircut on the horizon, Myriad could be facing a revenue decline in the coming years when growth was anticipated by investors. There's obviously still time to adjust the CMS' rates for the upcoming year, so all hope is not lost, but it'd probably be best to wait on the sidelines until we know exactly what the final reimbursement cuts will be.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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