Wednesday night at an investor/analyst meeting tied to a scientific conference and in a press release, Sequenom unveiled more data on its diagnostic test for Down Syndrome. Out of nearly 900 women there were no false negatives, but for the first time SQNM reported one false positive.
It's a simple blood draw rather than amniocentesis, which in rare cases can cause a miscarriage. A woman I work with, who's in her 30s and very pregnant, told me she and her husband anguished over whether to get the procedure. She didn't want it. He did. The husband won. Stressful situations like that could soon become a thing of the past for millions of couples. The risk of having a baby with Down Syndrome goes up with age.
Purists and physicans may look down their noses at the new, updated results until they see them and other data presented at a scientific conference and/or published in a prestigious peer-reviewed medical journal. One or both of those things is supposedly coming and SQNM is testing it on thousands more women. In the meantime, though, Sequenom says it's going to put the test on the market in June of this year. Some say docs will wait to push it until they see the science. But others say women and their partners are going to demand it.
The stock's been white hot over the past year or so and it sold off big time in early trading Thursday, possibly on a headline for a story written by Adam Feuerstein at TheStreet.com that said, "Sequenom Still Very Good, Just No Longer Perfect." It was referring to the one false positive result.
But after CEO Harry Stylli appeared "First on CNBC" on "Squawk on the Street" Thursday morning and called the stock move an overreaction, the shares began to trim their losses on pretty heavy volume.
And Mr. Stylli has some support from at least a couple of analysts.
Bruce Cranna at Leerink Swann, which specializes in healthcare stocks, wrote in a research note to clients, "We do not expect the detection of a false positive to be problematic, as any result that tests positive will confirm diagnosis with an invasive procedure." And Dr. Sean Lavin at Lazard Capital Markets used a phrase that gets thrown around a lot in the title of his note, "New paradigm in prenatal testing introduced." He went on to say, "Sequenom's presentation last night demonstrated, essentially, that its tests should gain rapid adoption...." Lazard and Leerink have banked SQNM and make a market in the stock.
My last question to Mr. Stylli was about Gov. Sarah Palin and her son with Down Syndrome.
Some fear the Sequenom test will result in fewer fetuses with Down Syndrome being carried to term. Jamie Coleman, who says he's the father of a three-year-old with Down Syndrome, sent me an email this morning to commend me for going there. "Thank you for asking the CEO of the company developing the diagnostic test for Down Syndrome the difficult question of the unintended consequences the test might have," he wrote. "It was a brave question, one he won't often be asked."
But as the test gets closer to coming to market and it gets more mainstream media attention, I suspect it will be asked a lot more.