California-based molecular diagnostic provider Myriad Genetics, Inc.'s (MYGN) wholly-owned subsidiary, Crescendo Bioscience, announced favorable data for its Vectra DA blood test at the 2014 American College of Rheumatology (:ACR) Annual Meeting in Boston, MA.

Vectra DA is the only multi-biomarker blood test validated to assess disease activity in patients diagnosed with rheumatoid arthritis (RA.V). The new data introduced Vectra DA as a better predictor of radiographic progression, compared to other conventional tests that are used to estimate risk of joint damage in RA patients, when studied for a period of two years.

The study was conducted on 143 RA patients who had undergone both the Vectra DA test and other standard tests over a 2-years' time span. At the end of 2 years, on comparing the patients' reports for Vectra DA and the other conventional tests, it was concluded that Vectra DA is the best independent predictor of disease progression.

In a separate development, results involving analysis of radiographic progression in RA patients from the Swedish Farmacotherapy (:SWEFOT) clinical trial were presented at the ACR. In this study, the Vectra DA test was conducted on 220 patients to estimate the degree of disease progression in them, from baseline to Year 1 and from baseline to Year 2.

The outcome showed a positive correlation between the Vectra DA score and the risk of damaged joints in RA patients, thus supporting the significance of Vectra DA test in evaluating disease progression following initiation of therapy to help manage the patient's disease.

Myriad's current strategy with Vectra DA lies in expanding private payer coverage for the test, as management believes that broader insurance coverage will play a key role in expanding physician utilization for Vectra DA.

Management believes broader reimbursement coverage for Vectra DA will have a significant positive impact on Myriad's gross margin. As management already expects gross margin to start improving from second-quarter fiscal 2015 and retain the momentum through the rest of the year, we are optimistic that Myriad is probably looking forward to a rise in reimbursement coverage soon.

We believe the abovementioned study results in favor of Vectra DA will eventually ramp up the process of expanding this reimbursement coverage, and in turn, boost revenues from this test.

Zacks Rank

Currently, Myriad retains a Zacks Rank #3 (Hold). Better-ranked stocks in the med-biomed/generic industry include Affymetrix Inc. (AFFX), AMAG Pharmaceuticals, Inc. (AMAG) and ANI Pharmaceuticals, Inc. (ANIP). All three stocks sport a Zacks Rank #1 (Strong Buy).

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