Summary
Those following the Sequenom saga continue their seemingly endless attempts to decipher a clear direction for the company. Amid data mishandling, executive terminations and a stunning $300 million dollar lawsuit, there could be options for the company to revive and survive.
Analysis
Sequenom's much publicized molecular diagnostic test for Down's syndrome and other chromosomal abnormalities captivated the attention of investors, clinicians and laboratorians alike. The revenue potential of these products and hope for patients that would benefit from them were quickly dashes when it was reported that the clinical study data was "mishandled" by Sequenom researchers. Investors saw Sequenom's stock plummet 87% from the beginning of the year following the announcement. But that's not all folks. The announcement was followed by termination of Sequenom's CEO, Senior VP of R&D and the resignation of the CFO and VP of commercial development for prenatal diagnostics. Sequenom is currently under investigation by the NASDAQ, the SEC and the US Attorney for the Southern District of California for the mishandling of data debacle. There is also the growing concern over Sequenom's proposed Laboratory Developed tests (LDTs) from both public and private agencies. Then on October 29, Xenomics filed a lawsuit against Sequenom seeking up to $300 million in damages. For investors, bad news is rarely good news and Sequenom does not fail to disappoint. So what's next for Sequenom?
One potentially attractive part of Sequenom's business could be their proprietary MassARRAY(r) genetic analysis systems. Although like many other companies competing in the life science research segments, Sequenom's capital equipment revenues have been hit hard by the current economic environment and tight capital acquisition budgets. However, that factor combined with the crushing Down's syndrome test news may attract potential buyers looking for a "value" market entry point into the lucrative and high growth genomic and proteomic market segments
For more information on Sequenom, the issues mentioned above and the life science market segment, please contact your GLG representative and schedule an individual consult today.
