VolitionRx Ltd (NYSE:VNRX) is closing in on a blood-based diagnostic for colorectal cancer that could encourage more people to seek out testing for the cancer, according to Mark Breidenbach, a closely-followed research analyst with Oppenheimer who is initiating coverage of its stock with an Outperform rating and a US$7 price target.
The non-invasive nature of VolitionRx’s blood test for colorectal cancer will make it popular compared to invasive colonoscopies, which are currently the most effective way to locate cancerous growths in the intestines.
Breidenbach expects the next 12 months to be “transformational” for the Belgian-based VolitionRx , which is knee-deep in conducting the largest-ever colorectal cancer screening study in collaboration with the National Cancer Institute’s Early Detection Research network with a cohort of over 13,500 subjects.
“Due to its non-invasive nature, we believe VolitionRx’s blood-based diagnostic could improve screening compliance, and the company’s innovative Nu. Q platform has generated compelling early data in colorectal cancer research,” Breidenbach wrote in a research note.
Breidenbach describes the company as an “overlooked innovator in the cancer diagnostic space”.
READ: VolitionRX boss praises “strong progress” in 2017; thinks Nu.QTM panel could be new gold standard in cancer detection
VolitionRx’s Nu.Q platform looks for molecular signatures of cancer by focusing on nucleosomes in the blood. As cancer cells multiply, they are modified in a way that distinguishes them from healthy cells and the traits of this malignant disease present on the nucleosomes, which are analyzed by Nu.Q’s platform.
The early data from the NuQ screening panels suggests the company’s screening method could be commercialized successfully if it is validated in bigger studies.
Breidenbach sees the potential for VolitionRx to launch its cancer screen in Europe in the first half of next year and to seek the approval of the US Food and Drug Administration in the US via a pre-market approval pathway to allow for the drug’s introduction in the US by 2021.
READ: VolitionRx hails interim results of Danish trial for screening colorectal cancer
“If Nu.Q-based panels can achieve performance levels comparable to other non-invasive screening options, they could potentially be adopted as a standard front-line screening option, greatly expanding their market opportunity,” concludes Breidenbach.
VolitionRx were trading 7% higher to US$2.40 in afternoon trade.