Myriad's Supreme Court loss is Quest Diagnostics' gain
Quest Diagnostics ($DGX) wasted no time after the U.S. Supreme Court ruled that human genes are a product of nature and cannot be patented. Hours after the historic decision, the company disclosed it will offer tests that spot two key breast cancer genetic mutations at the center of the judicial ruling.
Quest's move, as reported by Dow Jones/The Wall Street Journal, is an aggressive one and other diagnostics companies are likely to follow. It's also a blow to Myriad Genetics ($MYGN), whose patents of the BRCA1 and BRCA2 genes for hereditary breast and ovarian genetic mutations were at the center of the case.
Both genes helped fuel Myriad's wildly successful diagnostic test that gauges a woman's breast cancer risk. But now the company's market dominance will likely come to an end. Before the Court's decision, Myriad's patents prevented Quest and other rivals from developing competing diagnostics, but now all bets are off. Quest is one of the biggest laboratory diagnostics companies out there, and its move to develop a competing product focusing on the same biomarkers will likely have a quick turnaround.
"We now intended to validate and offer a BRCA1 and BRCA2 test service to physicians and patients later this year," Quest director of media relations Wendy H. Bost told the WSJ in an email Thursday afternoon. "Based on our initial review of the Court's decision, we expect it will open opportunities for Quest Diagnostics to develop new testing services, including in the area of hereditary breast cancer."
And many rivals are coming to the very same conclusion.
It's not a total loss for Myriad, of course. As noted in the WSJ piece, the court upheld its patients for CDNA--a synthetic version of the genes.
- read the Dow Jones/WSJ story (sub. req.)
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