What TESARO's Phase 3 NOVA Results Mean For Myriad Genetics

As a result, Myriad stock traded down by more than 7 percent on Monday. The firm reduced the target price from $24 to $22 and retained Equal-Weight rating on the stock.

Analyst Jack Meehan thinks that the move would raise questions on the need for companion diagnostics in oncology. He pointed out that after TESARO published its NOVA results on June 29; there has been a debate on the need to test with myChoice HRD on the back of unreleased HRD negative population.

Related Link: Credit Suisse Hikes TESARO Target Price To $122 On Robust Niraparib Data; Shares Up

While pointing out that TESARO is pushing for a broader label following a meeting with the FDA, the brokerage said in a research note, "Frankly, it appears Tesaro's HRD negative data for Niraparib was very similar to AstraZeneca's BRCA negative population for Lynparza (which required a companion diagnostics). We view the FDA's decision to allow a broad label as reflective of the strength of the overall data set presented."

Barclays pointed out that TESARO sees value in Myriad's HRD testing thus giving room for hopes. TESARO included PRIMA and QUADRA trials in its Niraparib.

However, the conditions would change if the FDA accords approval for a wider label for the drug. If that happens, the analyst thinks that Myriad needs to re-assess their commercialization tactics for companion diagnostics.

At Last Check ...

• Myriad was down 10.62 percent at $19.08.
• TESARO was up 22.5 percent at $121.51.

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