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Exact Sciences (NASDAQ:EXAS) was quietly flowing under the radar despite the company being in the midst of an FDA approval process for its colon-cancer screening test, the Cologuard, that has the potential of making the stock a big gainer, to the tune of 100% by next year. That flight under the radar ended Monday night when Jim Cramer beamed about the stock on CNBC, calling it an intriguing opportunity.

For some background, Exact Sciences is a molecular diagnostics company focused on colorectal cancer. The company has exclusive intellectual property protecting its non-invasive, molecular screening technology for the detection of colorectal cancer. Notably, stool-based DNA (sDNA) technology is included in the colorectal cancer screening guidelines of the American Cancer Society and the U.S. Multi-Society Task Force on Colorectal Cancer.

The company completed patient enrollment in its DeeP-C pivotal trial for colorectal cancer screening. The study enrolled more than 12,700 patients at sites in the United States and Canada. The DeeP-C study, one of the largest of its kind, is evaluating the accuracy of the company's stool DNA colorectal cancer screening test, comparing it to traditional screening methods. It is being conducted among a population of patients between the ages of 50 and 84 at average risk of colorectal cancer. The results of the DeeP-C trial are expected to form the basis for submitting the non-invasive test for Pre-Market Approval with the FDA.

The DeeP-C study is a follow up to the company's recently presented results of a 1,003-patient case-control study that used the same technology as the DeeP-C trial. Among the study population, there were 93 cases of colorectal cancer, 114 cases of advanced pre-cancers and 796 controls. At a nominal specificity of 90%, the Exact Sciences test detected 98% of colorectal cancers and 83% of pre-cancers with high-grade dysplasia, the majority of which progress to cancer. The test demonstrated 57% sensitivity in the detection of advanced pre-cancers equal to or larger than 1 centimeter. The test's sensitivity increased with the size of the pre-cancers, rising to 83% for pre-cancers larger than 3 centimeters.

The company has three upcoming milestones in the approval process that should serve as catalysts for the stock. In February, the company plans to submit the 2nd FDA module. In March, Exact Sciences expects to announce topline results in the DeeP-C study. In the April-May time period, the company plans to submit an application with the Centers for Medicare & Medicaid Services as well as submit the final FDA module containing clinical data. As a side note, the 1st FDA module was submitted by the company on December 7. That module was comprised of the required documentation regarding the manufacturing and quality control systems for the product.

Notably, the release of the topline results is just two months away and is expected to serve as the most important catalyst in the trio of upcoming catalysts. Investors and market participants are going to be closely paying attention to the data and then using it in estimating the odds that the FDA will approve the diagnostic cancer test. An FDA approval will send the product on the market and will be a big positive for the stock as Exact Sciences will start to generate revenue from the product. And the revenues may be significant, some project Exact Sciences' annual revenue could top $500 million or even $1 billion by the end of this decade if Cologuard gains wide acceptance. The company now has virtually no revenues.

The market for the product has potential as the company estimates that the global opportunity is greater than $3 billion, with $1.2 billion of that being in the US. The rest of the numbers are staggering. Colorectal cancer, commonly known as colon cancer, is the second leading cause of cancer deaths in the United States and the most deadly cancer among non-smokers. There are nearly 143,000 colorectal cancer cases diagnosed and 52,000 deaths due to this disease each year. Roughly one-third of colorectal cancer-related deaths could be avoided with regular screening. Of those diagnosed, nearly half are expected to die within five years because most cases are detected when cancer has progressed and is less treatable. For those whose cancer is detected at an earlier stage, the five-year survival rate can be greater than 90%.

EXAS is not the only diagnostics stock that has been making headlines, here are three other stocks.

Illumina (NASDAQ:ILMN) is a leading developer, manufacturer, and marketer of life science tools and integrated systems for the analysis of genetic variation and function. The company provides innovative sequencing and array-based solutions for genotyping, copy number variation analysis, methylation studies, gene expression profiling, and low-multiplex analysis of DNA, RNA, and protein. Illumina also provides tools and services that are fueling advances in consumer genomics and diagnostics.

The stock jumped about 8% on December 20 on renewed hopes of a buyout of the company by Roche Holding (OTCQX:RHHBY). This has been an ongoing saga for Illumina as Roche has tried to purchase the company multiple times. Now, there was a report by a Swiss paper that Roche may have agreed to buy Illumina at a price 48% higher than its original unsuccessful bid. Roche and Illumina management may have agreed to a bid at $66 a share last week that might be announced in the first half of January, the newspaper said. If true, this provides upside of 19% in shares of Illumina from current levels.

In other M&A news in the space, Amarantus BioScience (OTCQB:AMBS), a biotechnology company developing treatments and diagnostics for diseases associated with neurodegeneration and apoptosis, announced the company purchased all of the intellectual property assets from Power3 Medical Products.

As part of the transaction, Amarantus took ownership of 20 pending patent applications covering a variety of biomarkers and assays related to the treatment of various diseases including Parkinson's, Alzheimer's, and ALS, as well as patent applications related to Breast Cancer, neuromuscular disease and Chronic Myelogenous Leukemia. The company also acquired all of the data generated by Power3 while creating its IP portfolio. All of the disease states covered by the intellectual property acquired from Power3 are related to Programmed Cell Death (Apoptosis).

A brief side note, investing in micro-cap stocks is risky as they tend to be new and unproven. Low trading volumes increase liquidity risk.

Sequenom (NASDAQ:SQNM) is a life sciences company committed to improving healthcare through revolutionary genetic analysis solutions. Sequenom develops innovative technology, products and diagnostic tests that target and serve discovery and clinical research, and molecular diagnostics markets.

The stock has nearly doubled over the past 6 months as investors renewed their confidence in the company. Even with the gains, analysts peg the fair value of the stock at $6.60 a share, providing upside of 30% from today's prices. Recent news for the company includes an announcement that the American College of Obstetricians and Gynecologists (ACOG) Committee on Genetics and the Society for Maternal-Fetal Medicine Publications Committee recommended that cell-free fetal DNA testing be offered to patients at increased risk of aneuploidy. The testing can also be used as a follow-up test for women with a positive first-trimester or second-trimester screening test result. Previously, the ACOG recommended that women, regardless of maternal age, be offered prenatal assessment for aneuploidy by screening or invasive prenatal diagnosis. That news sent the stock up 15% on heavy volume.

Source: First Half Of 2013 To Be A Critical Time For Exact Sciences