InVitae Analyst: Acquisition Beefs Up Company's Hereditary Cancer Testing Capacity

After purchasing Singular Bio in June, InVitae Corp NVTA now plans to acquire Jungla, which would add to its hereditary cancer testing capabilities, according to Benchmark.

The Analyst

Bruce Jackson maintained a Buy rating on InVitae and raised the price target to $26.

The Thesis

InVitae plans to acquire Jungla for $50 million in a cash-and-stock deal, plus another $15 million in milestones to be paid mainly in stock, Jackson said in a Friday note. (See his track record here.) 

The addition of Jungla enhances InVitae’s capabilities to resolve variants of unknown significance — VUS — in genetic cancer testing, the analyst said. Supplemental RNA analysis for variant classification lends greater accuracy than is possible with DNA sequencing alone, which gives InVitae a competitive advantage, he said. 

"The Jungla Functional Modeling Platform combines functional genomics, computational biophysics and computer science into a platform that provides patients with auditable, accurate, comprehensive and clear clinical guidance." 

The platform has shown prospective accuracy against clinical test results from other providers and delivers a higher level of performance than is recommended by the American College of Medical Genetics and Genomics and the

Association for Molecular Pathology for hundreds of genes and conditions, according to Benchmark. 

Price Action

InVitae shares were down 0.61% at $22.88 at the time of publication Friday. 

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