Myriad Genetics Expands Consumer Access to Genetic Testing with Acquisition of Gateway Genomics and Its Market-Leading SneakPeek® Early Gender DNA Test

Rhea-AI Summary

Myriad Genetics has acquired Gateway Genomics for $67.5 million, enhancing its Women's Health portfolio. This acquisition incorporates the popular SneakPeek Early Gender DNA Test, which reveals a baby's gender as early as 6 weeks into pregnancy with 99% accuracy. The move aims to broaden access to personalized genetic tests, serving a market of approximately 3.6 million annual births in the U.S. SneakPeek is projected to grow at a rate above 20% in the next few years. The deal is expected to be neutral to Myriad's earnings in 2023 and accretive in 2024.

Positive

• Acquisition expands Myriad's Women's Health offerings, enhancing growth potential.
• SneakPeek has sold over 750,000 units, indicating strong market demand.
• Projected revenue for Gateway in 2022 is approximately $20 million.
• SneakPeek's growth rate exceeds 20% annually, promising future revenue increases.
• Acquisition expected to be accretive to Myriad's growth and earnings in 2024.

Negative

• None.

• $67.5 million tuck-in acquisition strengthens Myriad’s Women’s Health portfolio of prenatal products
• Fast-growing SneakPeek test has helped 750,000 parents learn baby’s gender from home – earliest method to date at 6 weeks into pregnancy

SALT LAKE CITY, Nov. 01, 2022 (GLOBE NEWSWIRE) -- Myriad Genetics, Inc., (NASDAQ: MYGN), a leader in genetic testing and precision medicine, today announced that it has acquired Gateway Genomics, LLC, a personal genomics company and developer of consumer genetic tests including the No. 1 selling SneakPeek^® Early Gender DNA Test. SneakPeek reveals a baby’s gender at six weeks into pregnancy -- the only at-home test to do so with 99% accuracy and the earliest method available.

The acquisition strengthens Myriad Genetics’ portfolio of Women’s Health products, expanding access to personalized genetic tests during the reproductive stage of a women’s life and beyond. With SneakPeek, Myriad now serves women earlier in their pregnancy, providing data-driven genetic insights through their lifetime with the Prequel^® non-invasive prenatal screen, Foresight^® carrier screen, and MyRisk^™ Hereditary Cancer Test with RiskScore^® for all ancestries.

Approximately 3.6 million babies are born in the United States every year*, and SneakPeek attracts over 4 million annual visitors to its website, capturing a large percentage of pregnant families who could benefit from a range of prenatal care options. Through expanded online engagement, consumers who use SneakPeek also can learn the benefits of other forms of genetic testing offered by Myriad Genetics.

Over the last three years, SneakPeek has grown at a compound annual rate exceeding 20%. SneakPeek is offered directly to consumers at sneakpeektest.com, online channel partners, and more than 1,850 clinicians in the U.S. and select international markets. The test has strong brand loyalty and a 76-point Net Promoter Score. It is the best-selling prenatal DNA test on Amazon^® and the top searched gender test on Google^® with more than 9,000 reviews and a 4.5 star average rating.

The test kit includes a SneakPeek Snap^® device that provides an automated way for moms to easily collect blood samples at home. The user places the Snap device on their upper arm, presses the button, and the sample is collected in 1-4 minutes. Samples are mailed to Gateway and results may be received as early as the same day via email. 

“Gateway Genomics and the SneakPeek test reinforce our mission to advance health and well-being for all with innovative science-based tests that bring relevant genetic information to consumers and clinicians in a way that is accurate, affordable and easy to use,” said Paul J. Diaz, president and CEO, Myriad Genetics. “As a trusted lab source for prenatal and hereditary cancer testing, Myriad can now offer a comprehensive suite of women’s health testing solutions before, during, and after pregnancy. All of us at Myriad Genetics are excited to welcome Chris Jacob, Gateway’s CEO, and the entire Gateway management team and staff to our Women’s Health operating division.”

“With more than 750,000 SneakPeek Early Gender DNA Tests sold to date, Gateway Genomics has advanced our shared mission to expand access to affordable genetic testing and improve family planning outcomes,” added Chris Jacob, CEO, Gateway Genomics. “We are thrilled to join Myriad to benefit from their experience and infrastructure, accelerating the commercial expansion of our tests. Together, we will empower and support every woman through her pregnancy journey with advanced prenatal screening to help their family thrive from the start.”

Myriad Genetics acquired Gateway Genomics for an upfront cash purchase price of $67.5 million, subject to customary working capital adjustments and an escrow of $7.5 million. Gateway has the opportunity to earn up to an additional $32.5 million of cash payments in 2023 and 2024 if certain revenue, volume synergy and EBITDA targets are achieved. Projected revenues for Gateway in calendar year 2022 are approximately $20 million. The core Gateway business is expected to grow over 20% compounded over the next three to five years, excluding synergies, and is expected to be neutral to Myriad’s earnings and operating cash flows in 2023. Gateway’s business also is expected to be accretive to Myriad’s growth rate, earnings and operating cash flows in 2024. Guggenheim Securities, LLC acted as financial advisor to Myriad Genetics. Raymond James acted as financial advisor to Gateway Genomics.

About Myriad Genetics
Myriad Genetics is a leading genetic testing and precision medicine company dedicated to advancing health and well-being for all. Myriad develops and offers genetic tests that help assess the risk of developing disease or disease progression and guide treatment decisions across medical specialties where genetic insights can significantly improve patient care and lower healthcare costs. Fast Company named Myriad among the World’s Most Innovative Companies for 2022. For more information, visit www.myriad.com.  

About Gateway Genomics
Located in La Jolla, CA, Gateway Genomics is a personal genomics company with the mission to develop leading-edge genetic tests that give families a new level of understanding about their future children. It has been recognized as an Inc 5000 Fastest Growing Company for four consecutive years.

* Source: CDC Births: Final Data for 2020 https://www.cdc.gov/nchs/fastats/births.htm

MyRisk, Myriad MyRisk, MyRisk Hereditary Cancer, MyChoice CDx, Prequel, Prequel with Amplify, Amplify, Foresight, Precise, FirstGene, Health.Illuminated., RiskScore, Prolaris, GeneSight, and EndoPredict are trademarks or registered trademarks of Myriad Genetics, Inc. and its subsidiaries © 2022 Myriad Genetics, Inc. All rights reserved.

Safe Harbor Statement

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to Myriad offering a comprehensive suite of women’s health testing solutions, SneakPeek customers learning the benefits of other forms of genetic testing offered by Myriad Genetics, the acceleration of the expansion of Gateway’s tests, empowering and supporting every woman through her pregnancy journey with advanced prenatal screening to help their family thrive from the start, the projected revenues of Gateway in calendar year 2022 and growth of Gateway over the next three to five years, excluding synergies, and the expected impact of the acquisition on Myriad’s earnings, operating cash flows and growth rate. These “forward-looking statements” are based on management’s expectations of future events as of the date hereof and are subject to a number of known and unknown risks and uncertainties that could cause actual results, conditions, and events to differ materially and adversely from those anticipated. Such factors include those risks described in the company’s filings with the U.S. Securities and Exchange Commission, including the company’s Annual Report on Form 10-K filed on February 25, 2022, as well as any updates to those risk factors filed from time to time in the company’s Quarterly Reports on Form 10-Q or Current Reports on Form 8-K.

Media Contact: Megan Manzari (385) 318-3718 Megan.Manzari@myriad.com

Investor Contact: Matt Scalo (801) 584-3532 Matt.Scalo@myriad.com

FAQ

What impact will the acquisition of Gateway Genomics have on MYGN's stock?

The acquisition is expected to be neutral to Myriad's earnings in 2023 and accretive in 2024, potentially boosting MYGN's stock performance.

How does the SneakPeek test benefit Myriad Genetics?

SneakPeek enhances Myriad's Women's Health portfolio by providing early and accurate gender determination, increasing customer engagement prior to pregnancy.

What was the transaction value for Gateway Genomics?

Myriad Genetics acquired Gateway Genomics for an upfront cash purchase price of $67.5 million.

What are the growth projections for SneakPeek and Gateway Genomics?

SneakPeek is projected to grow at over 20% annually, while Gateway's business is expected to sustain similar growth over the next three to five years.

What is the significance of the SneakPeek test in prenatal care?

SneakPeek is the only at-home test revealing a baby's gender at six weeks of pregnancy, offering significant convenience and accuracy for expecting parents.