What Happened?
Shares of oncology (cancer) diagnostics company NeoGenomics (NASDAQ: NEO) jumped 22.5% in the morning session after a court ruled in the company's favor in a patent infringement lawsuit against Natera.
The District Court for the Middle District of North Carolina granted NeoGenomics' motion for summary judgment, declaring all of Natera's asserted patent claims invalid. The court stated it will dismiss Natera's claims with prejudice, a final judgment that prevents the case from being brought again.
This legal victory is significant as it allows NeoGenomics to freely commercialize its RaDaR® ST assay, an oncology diagnostic solution. The company has already launched the product to biopharma customers and has submitted it to the Centers for Medicare & Medicaid Services (CMS) to obtain clinical reimbursement coverage, potentially expanding its market access.
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What Is The Market Telling Us
NeoGenomics’s shares are extremely volatile and have had 37 moves greater than 5% over the last year. But moves this big are rare even for NeoGenomics and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 16 days ago when the stock gained 3.2% on the news that markets continued to rally amid growing speculation of an impending interest rate cut by the Federal Reserve. Following a favorable Consumer Price Index (CPI) report, investors are increasingly betting on a rate reduction next month, a sentiment amplified by U.S. Treasury Secretary Scott Bessent's call for a significant cut. This has fueled a 'risk-on' environment across Wall Street. Lower interest rates are typically beneficial for growth-oriented sectors like healthcare, as they reduce the cost of borrowing for research and innovation and increase the present value of future earnings.
NeoGenomics is down 45.6% since the beginning of the year, and at $8.97 per share, it is trading 51.8% below its 52-week high of $18.61 from January 2025. Investors who bought $1,000 worth of NeoGenomics’s shares 5 years ago would now be looking at an investment worth $230.28.
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