VolitionRx's Nu.Q blood-based diagnostic tests offer great potential, says Oppenheimer analyst

Analyst Mark Breidenbach's valuation is based primarily on Nu.Q's market opportunity for colorectal cancer screening in the US and EU

Cancer cells
VolitionRx develops and markets its cost-effective Nu.Q blood-based tests to accurately diagnose colorectal cancer

The easy-to-use Nu.Q blood-based diagnostics tests offered by VolitionRx Ltd (NYSEAMERICAN:VNRX) will provide a key tool in screening for colorectal cancer going forward, says Mark Breidenbach, an analyst with Oppenheimer.

In a note to investors, Breidenbach argues that the Belgium-based company’s diagnostic tests for different cancers can “meaningfully improve the gap in screening compliance for colorectal cancer.”

“We see the company’s products for colorectal cancer screening as its primary value drivers,” he added.

Breidenbach’s valuation of VolitionRx is based primarily on Nu.Q’s market opportunity for colorectal cancer screening in the US and European Union.

Currently, VolitionRx develops and markets its cost-effective Nu.Q blood-based tests to accurately diagnose colorectal cancer as well as a broad range of other cancers. The tests are based on VolitionRx’s Nucleosomics technology platform, which identifies and measures nucleosomes in the bloodstream or in other bodily fluid.

On Monday, VolitionRx revealed that it expects modest initial revenue starting in the coming quarter due to the sale of its Nu.Q blood-based tests.

Read: VolitionRx expects its Nu.Q blood-based test kits to generate new revenue in coming quarter

Among the Belgium-based company’s recent wins announced along with second-quarter results is a sales agreement with Active Motif for an array of Research-Use-Only kits, the first of which, the Nu.Q Total assay kit is now on the market.

“We expect modest initial revenue in the coming quarter, building through next year and beyond,” the company said in a statement.

Additional advances announced at the end of the second quarter include VolitionRx’s move to sign agreements to conduct two colorectal cancer research studies across Asia in collaboration with the National Taiwan University.

The company also released preliminary data from a study that showed its Nu.Q assay kits diagnosed men with aggressive prostate cancer with 94% accuracy, which prompted praise from Breidenbach.

Read: VolitionRx unveils data showing its Nu.Q assays detect aggressive prostate cancer in men with 94% accuracy

“While we caution against making broad conclusions from small pilot studies, we believe these data highlight the potential of VolitionRx’s tech platform in applications well beyond colorectal cancer,” Breidenbach wrote.

VolitionRx ended the second quarter with US$11.9mln in cash, which combined with its recent US$9mln private placement, could sustain its business operations until the middle of next year, Breidenbach added.

The analyst reiterated his Outperform rating on VolitionRx, but adjusted his price target to US$6 from US$7 to reflect delays in clinical trials involving the Nu.Q tests.

Contact Ellen Kelleher at [email protected]


Quick facts: VolitionRx

Price: 3.08 USD

Market Cap: $142.38 m

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