Myriad Genetics Puts Its Autoimmune Division Up for Sale

What a difference a pandemic makes! Last year at this time, molecular genetic testing was a fairly soft market. But the unprecedented and unexpected demand for COVID-19 diagnostics has lifted the revenues of genomics firms to incredible levels. Regrettably, not all companies in the molecular diagnostics space have shared in the prosperity. And now one of the most established and respected of these have-not genomics firms has decided put a part of itself up for sale.

Tough Times for Myriad Genetics

Founded in 1991—10 years before the human genome was sequenced—Myriad Genetics was one of the first genomics companies in history and a pioneer in molecular tests for cancer, autoimmune disorders, depression and other hereditary diseases. In 2020, it generated nearly $637 million in revenues led by a stable of products that includes the Prolaris cancer prostrate, EndoPredict, Vectra DA rheumatoid arthritis and GeneSight pharmacogenetics tests.

However, a soft market, coverage denials and sagging reimbursements have caused the firm to struggle in recent years. Revenues fell, share prices declined and analysts grew restless. When the pandemic came, things went from bad to worse. Myriad wasn’t positioned to provide viral diagnostic testing the way many other genomics firms were. Nor did it pivot to meet the demand for COVID-19 diagnostics. Consequently, while competitors were reaping double- and even triple-digit growth, Myriad saw double-digit decline, with total revenues falling 22 percent in 3Q of 2020, including a 21 percent drop in core molecular diagnostics. Just about all product lines took a hit, including:

• Prolaris—down 2 percent;
• GeneSight—down 48 percent;
• Vectra DA—down 17 percent; and
• Women’s health division products, including myRisk Hereditary Cancer, Foresight and Prequel—down 34 percent.

Myriad Makes a Strategic Decision

Myriad executives have been hard at work performing strategic review and plotting initiatives to stem the bleeding via simplification of the business, adjustment of the cost base and development of new commercial capabilities. And on Jan. 6, 2021, the company announced a key decision: it would reorganize its international operations and seek a buyer for its autoimmune business, including the Vectra DA test.

Although it accounted for over $40 million in annual revenues before the pandemic, Vectra DA has been in steady decline. Rather than seek to turn things around, Myriad will sell off the test and rest of the autoimmune division to focus on core hereditary tests. “We believe the growth prospects for this product are even more significant in an organization with greater focus and complementary capabilities in autoimmune disease,” noted Myriad President and CEO Paul Diaz in a statement.

The Vectra DA decision comes a couple of months after Myriad indicated that it was planning to sell off its Myriad RBM pharmaceutical contract research services business and myPath Melanoma dermatology test. These divestments are part of a larger plan in which Myriad will initially focus on recovering from the pandemic by implementing a $40 million cost savings plan over the next nine months and investing $20 million to improve marketing and customers’ experience. In phase two, the company will refocus on key growth initiatives and improving financial performance. In the third phase, Myriad will invest in new innovations and potential M&A opportunities.