Why Myriad Genetics, Inc. Shares Popped Again

Myriad shares climb after announcing a patent infringement resolution. Should investors be gobbling up this news or should they remain cautiously on the sidelines?

Feb 7, 2014 at 2:02PM

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 developer of molecular diagnostic tests, rallied by as much as 11% -- its second double-digit gain this week -- after announcing a patent lawsuit resolution with Gene by Gene before the opening bell.

So what: According to the press release, Gene by Gene has agreed to stop selling and marketing its clinical diagnostic tests within North America that specifically target the BRCA1 and BRCA2 genes, which are biomarkers that lend to a higher probability of developing breast and ovarian cancer in women. Gene by Gene will still be able to sell and market its BRCA1/BRCA2 diagnostic tests outside of North America, as well as conduct BRCA1/BRCA2 tests when it relates to whole genome and exome products. The agreement keeps Gene by Gene's products off the North American market until February 2016 or until the last BRCA patents expire, and in return Myriad agrees to drop its patent infringement claim against Gene by Gene without prejudice.

Now what: The reason Myriad is rallying so extensively yet again today is that its primary revenue-generating tool is its BRCA1/BRCA2 test known as BRACAnalysis. In its second-quarter results released Tuesday night, we saw that 69% of its total quarterly revenue was from this single gene test. We also know that Myriad had some of its gene patents related to this test invalidated in June, allowing competitors to enter the market and possibly erode its market share. Today's resolution helps remove another possible competitor from the fray and allows Myriad to instead focus on developing new products and getting the most out of its existing product line. There's still a big concern that Medicare reimbursement reductions could wipe out a decent portion of Myriad's growth, which has me personally sticking to the sidelines, but I'd nonetheless recommend adding the company to your watchlist at this point in time.

Myriad Genetics shares have soared this week, but they'll likely have a hard time keeping pace with this top stock throughout 2014
There's a huge difference between a good stock and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.

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.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers