BURLINGTON, N.C. - Labcorp (NYSE: LH), a leading provider of laboratory services, announced it has obtained De Novo marketing authorization from the U.S. Food and Drug Administration (FDA) for its PGDx elio plasma focus Dx. This product is noted as the industry's first kitted liquid biopsy test that can profile a range of tumor mutations through a simple blood draw, especially when tumor tissue samples are limited or not available.
The PGDx elio plasma focus Dx is designed to enhance the precision oncology offerings by Labcorp. It is a qualitative next-generation sequencing-based in vitro diagnostic device that can detect single nucleotide variants, insertions, deletions, copy number amplifications, and translocations across various genes.
This test is geared towards providing oncologists with a targeted tumor-profiling solution that spans numerous solid-tumor types. It operates on the same platform as Labcorp's tissue-based assays, aiming for easy integration into routine laboratory workflows.
According to Shakti Ramkissoon, M.D., Ph.D., MBA, vice president and medical lead for oncology at Labcorp, the launch marks a significant expansion in their suite of precision oncology solutions. He emphasized that the test offers a cost-effective and convenient method for laboratories and oncologists to obtain critical data, which can inform more personalized patient care plans.
The assay is said to target guideline-recommended biomarkers, which may lead to more accurate clinical assessments. It also includes automated bioinformatics to expedite the delivery of results, potentially aiding oncologists in making timely treatment decisions in conjunction with other laboratory and clinical findings.
Labcorp, recognized for its comprehensive precision oncology portfolio, serves clients globally, with a significant role in supporting new drug approvals and conducting a vast number of patient tests annually. This recent FDA authorization represents an advancement in Labcorp's efforts to provide innovative solutions that contribute to personalized medicine and patient care.
The information for this article is based on a press release statement.
In other recent news, Labcorp has reported significant developments, including surpassing Wall Street's profit and revenue expectations for the second quarter. The company's diagnostics unit, its largest revenue contributor, reported a 7.9% increase in quarterly sales, reaching $2.52 billion, while total sales amounted to $3.22 billion. This success, attributed to heightened demand for diagnostic tests, has led Labcorp to raise its annual sales growth outlook to a range of 6.4% to 7.5%.
Financial services company Baird has upgraded Labcorp's price target from $256 to $258, maintaining an 'Outperform' rating on the stock. This adjustment follows a comprehensive valuation analysis using various financial models, including near-term and five-year projections. Despite potential risks, Baird's analysis suggests solid performance for Labcorp.
Labcorp's strategic acquisitions, such as the recent purchase of Invitae (OTC:NVTAQ), a genetic test maker that filed for bankruptcy, for $239 million, indicate a robust position in the healthcare diagnostics market. The acquisition aligns with Labcorp's strategy to advance its leadership in genetic screening and diagnostics. This move is set to enhance Labcorp's specialty testing capabilities, particularly in areas such as oncology and rare diseases.
InvestingPro Insights
Labcorp (NYSE: LH), known for its pivotal role in healthcare diagnostics, continues to make strides in personalized medicine with its latest FDA authorization. The financial metrics and market activity surrounding Labcorp offer insights into the company's performance and potential outlook. As of the last twelve months leading up to Q2 2024, Labcorp has shown a revenue growth of 5.22%, with a gross profit of $3.5 billion, demonstrating the company's ability to increase its earnings and maintain profitability in a competitive industry.
Investors tracking Labcorp's market performance will note the company's market capitalization stands at $19.56 billion. Despite trading at a high earnings multiple with a P/E ratio of 40.89, the company's adjusted P/E ratio for the same period offers a more attractive figure at 25.38. This indicates that while the stock may seem expensive based on past earnings, the adjusted figures provide a different perspective on its valuation.
Moreover, Labcorp has been experiencing significant returns, as evidenced by a 10.66% total price return over the last week and a 15.12% return over the past month. These returns reflect the market's positive reception to recent developments, including the new FDA authorization.
According to InvestingPro Tips, management's aggressive share buybacks and the high shareholder yield are factors that may be contributing to these strong returns. Investors interested in exploring more about Labcorp's financials and market performance can find additional InvestingPro Tips, with a total of 13 listed on the InvestingPro platform.
It is also noteworthy that the company is trading near its 52-week high, which is 99.65% of the peak price, signaling investor confidence in its current trajectory. Labcorp's prominence in the Healthcare Providers & Services industry is further solidified by its innovative contributions to precision oncology, aligning with the company's strategic goals.
For detailed analysis and further InvestingPro Tips on Labcorp, one can visit https://www.investing.com/pro/LH.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.