Shares of Invitae (NVTA 0.94%) were up 8.9% as of 3:42 p.m. EST on Wednesday. The gain came after Pacific Biosciences of California (PACB 4.90%) announced a collaboration with Invitae to expand its whole genome testing capabilities using PacBio's new HiFi sequencing systems.
PacBio announced the multi-year partnership today, but Invitae didn't include anything about the collaboration on its website. Often, shares of the vendor in these kinds of deals jump more than the customer's shares do. That wasn't the case here, with PacBio stock rising but not nearly as much as Invitae stock did.
Nevertheless, the arrangement with PacBio looks like a good move for Invitae. Invitae CEO Sean George said that this deal will enable his company "to develop a new generation of innovative whole genome-based offerings." George expects the collaboration will help make whole genome sequencing for diagnosing diseases and guiding healthcare decisions "affordable and accessible to all patients who can benefit from in-depth, full genome information."
The news of the partnership with PacBio appeared to draw some investors back after Invitae's shares fell 10% on Monday. This drop came after the genetic testing company provided a preliminary look at its 2020 full-year financial results and an outlook for 2021.
Probably the biggest wild card for Invitae going forward is the impact of the ongoing COVID-19 pandemic on its business. However, the healthcare stock should have room to run with expectations of annual revenue growth between 50% and 60% over the next few years.