Evercore Expects Only Minimal Impact on Hologic (HOLX) from NEJM Piece on Mammography Screening
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Evercore ISI affirms Hologic (Nasdaq: HOLX) at Buy with a price target of $43 following a NEJM publication which looked at Surveillance, Epidemiology, and End Results (SEER) data from 1975 to 2012 to investigate the impact of screening on tumor-size distribution, size-specific incidence of breast cancer among women 40+ and the size-specific cancer fatality rate before and after the advent of widespread mammography screening (1975-1979 vs 2008-2012).
The firms dosn't see a huge impact from the study and noted the following key points on Thursday:
- While the article reads negative for the benefits of screening (HOLX stock underperforming peers as we write this), we note that this is not a issue and the cost-benefit of screening mammography has been debated in the past
- The U.S. Preventive Service Trask Force (USPSTF) has already changed its screening recommendation, and had issued a ‘C’ Grade recommendation for screening in 40-49 year olds (and biennial mammography screening for women aged 50 to 74 years old) – when this was issued in 2013, it had sparked a speculation on downturn in screening volume, which hasn’t materialized
- National Comprehensive Cancer Network (NCCN) recently put out their guidelines with the statement that ‘multiple studies show a combined use of digital mammography and tomosynthesis appears to improve cancer detection and decreased call back rates’
- In simplistic terms, the article seems to imply that as small tumors have low mortality risk, it does not confer additional benefits while at the same time resulting in over diagnosis. We think that physicians and patients are likely to have differing opinions on this (eg: if a liquid biopsy sequencing revealed cancer / tumor that was undetectable otherwise, does it imply that one should not detect them early?)
- In our view, as long as the payors continue to reimburse mammography and the guidelines remain favorable, this study is unlikely to have an impact on HOLX or mammography screening.
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