Veracyte Now In Position For A Rate Increase In 2018

Cantor Fitzgerald analyst Bryan Brokmeier told investors to buy shares of Veracyte Inc VCYT.

"The shift to market-based pricing and clarity on the implementation timeline improves transparency and recognizes the value innovative tests bring to the market," Brokmeier said.

Specifically related to Veracyte, the Cantor analyst noted "the final rule positions it to receive a rate increase in 2018. VCYT has been successful in signing contracts with commercial payors at rates above Medicare, which should ensure a rate increase in 2018. Moreover, should the June 10, 2016 proposed 30% Medicare rate reduction for VCYT’s Afirma GEC go into effect in 2017, PAMA appears to increase the rate to a level that is in line with commercial payors without an annual limit."

Brokmeier maintained a Buy rating and $13 price target on shares of Veracyte.