Macro factors dominated biotech share price performance as earnings season looms. The S&P Select Biotech Index testing the top end of the recent trading range after seven straight up days on cooler-than-expected June CPI data.
The initial move coincided with only the second time in history since inception in 1979 that the small-cap Russell 2,000 gained 3%+ while the S&P 500 fell on the day.
Investors are now boosting the odds of the Fed Reserve rate cut in September and expectations are for 2-3 cuts this year. The sector also seems to be moving on raising expectations for a GOP win in this election cycle. Democrats have signaling the desire to be more aggressive on drug pricing legislation while looking to further subsidize Medicaid, exchanges, and hospitals.
M&A:
Illumnia (ILMN) acquired Fluent Biosciences (private), a consumables-only solution for single cell sequencing. The news pressured competitor 10X Genomics (TXG) given its leading position in the single cell mkt (70% of revs come from single cell)
Regulatory:
The Centers for Medicare and Medicaid Services (CMS) released proposed rule changes for the CY25 Hospital Outpatient Prospective Payment System (HOPPS) that would exempt diagnostic radiopharmaceuticals that cost >$630 per day from being bundled with the costs of the overall imaging procedure. Lantheus Holdings (LNTH) shares rallied >35% on the news as they would have subject to negative reimbursement headwinds starting in 2025 due to expiration of a temporary pass through status
WSJ reported the FTC plans to sue pharmacy-benefit managers (PBMs) over drug price negotiation tactics. The FTC recently completed a two year investigation as to whether they steer patients to higher priced or higher margin products
Clinical:
UniQure (QURE) reported 24 month data for AMT-130 in Huntington's Disease patients that showed slowing of disease progression in a composite disease rating scale and reduction of biomarker NfL. FDA awarded the company RMAT designation to facilitate further clinical development. QURE had been trading as negative $200+ million enterprise value before the update
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