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Biotech Natera is Growing on a Huge New Market

Natera market capitalization has increased by more than 875 percent in the last five years, outpacing the S&P 500’s 103 percent increase. The $10.25 billion med-tech company, which refined its diagnostics craft on non-invasive blood testing to screen for fetal genetic disorders like Down syndrome, is now gaining headway in oncology diagnostics, which is Guardant Health’s and ARK Genomic Revolution ETF’s turf.

Since 2013, Natera testing volume in the non-invasive reproductive health category has increased every year, from over 88,000 tests in 2013 to over 1 million in 2020. Throughout the pandemic, the volume has increased, exceeding pre-COVID-19 growth objectives. In addition, in August 2020, the American College of Obstetricians and Gynecologists confirmed its recommendation for chromosomal defect screening as an option for all women regardless of age or risk factors, giving the company a huge boost.

As a result, the majority of insurers are covering the cost of the Prospera test. Regardless of age or risk, the market-leading biotech predicts that over 90% of all commercially wrapped (i.e., non-government-insured) individuals are eligible for Prospera testing. CEO Steve Chapman estimated in a recent conference call that Natera is approaching 30% penetration among the approximately 3.4 million “average-risk” births in the United States, leaving plenty of space for expansion.

Natera has established new possibilities for expansion while preserving its leadership position in the reproductive health diagnostics sector. It is now focusing on the $15 billion oncology sector for minimal residual disease (MRD). MRD testing looks for a tiny number of cancer cells that linger in the body during or after therapy and can help with treatment decisions and prognosis.

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