From personalized treatment to diagnostics, the future has never been brighter for patient outcomes. Find out where our team sees opportunities on the horizon.
Colon cancer is beatable 90% of the time,1 when caught early enough. And compared to other types of cancers, there is a reliable, if not pleasant, way to detect colon cancer — colonoscopies. However, only 69% of adults between the recommended screening age window of 50 to 70 years go for their colonoscopies.2
A few years ago, Wisconsin-based Exact Sciences launched an alternative method of detecting possible signs of cancer in the colon: Cologuard, which involves an at-home collection of a stool sample, thereby allowing most people to avoid a colonoscopy. This has been so successful that the United States Preventive Services Task Force (USPSTF) extended the recommended screening age down to 45 years of age.3
As people’s life expectancy continues to grow, it is possible that the upper age limit will be raised as well. (Notably, actor Chadwick Boseman died at just 43 years old after battling colon cancer for four years. While the occurrence of colon cancer becomes more prevalent as people get older, it can occur at any age. Get tested!)
Exact Sciences has grown their product portfolio, first by the acquisition of Genomic Health, and more recently by acquiring Thrive. Genomic Health has tests for breast and prostate cancers, which measure the level of gene expression in tumours, allowing for a more personalized treatment regime. For instance, their Oncotype DX test for women diagnosed with breast cancer indicates which patients can safely skip chemotherapy, as chemotherapy has no benefit for a subset of breast cancer patients.4
In our view, Thrive is an even more innovative company. They are developing a blood test to detect many forms of cancer. This is an even easier test to perform than the at-home Cologuard test, as Thrive would just require a tube of blood, as routinely given at one’s annual checkup. It can also be used for cancer monitoring during treatment, to quickly see if the current treatment is working or if the tumour is changing, perhaps building resistance to the current treatment. It can also help monitor for the return of cancer in recovered patients. While Thrive’s test is still under development and is not yet approved for use, it gives insight into what may be the future of health care diagnostics.
This view is reinforced by Illumina’s proposed acquisition of Grail, which offers similar blood-based tests as Thrive. Illumina is the preeminent “next-generation sequencing” (NGS) company with significant market share, and their machines are in the lab of most innovative testing/diagnostic companies we visit. Their machines are also used by university researchers, pharma companies, genetic medicine companies, and agriculture companies that are interested in identifying the genetics of productive plants and animals.
We believe determining the genetic sequence of people, the food they eat, the clothes they wear, the tumours they have, and the viruses they acquire will become increasingly possible, and useful for our day-to-day life.
Next-generation sequencing works in contrast to polymerase chain reaction (PCR) testing, which we have all heard of recently in the context of COVID-19 tests. PCR tests look for a known sequence of DNA, while next-generation sequencing allows you to discover which DNA sequences are present when they are initially unknown. Illumina’s machines were used to first sequence the coronavirus that became known as COVID-19, and in our view, they can be crucial in identifying new variants of the virus as it mutates.
PCR testing is very useful for the rapid diagnosis of viruses — especially so in Biocartis’ machines. Biocartis has developed a point-of-care device that takes in a tissue sample or blood sample and returns a result in just 15 minutes. It eliminates the need to send a sample to a lab, and doesn’t even need any specialized preparation of the sample, so it can be used by health care workers in clinics and hospitals.
Biocartis’ initial tests were based on detecting particular mutations in tumours, directing doctors to specific drugs that would work for that mutation, but after the outbreak of COVID-19, Biocartis quickly developed a fast PCR test for the virus, using the same device that performs the rapid cancer mutation test. They are working to make a combined flu and COVID-19 test which would quickly diagnose what is happening in a symptomatic patient, and may continue to add more tests to the same device, increasing its usefulness. The COVID-19 outbreak badly affected Biocartis as cancer treatments were disrupted, but we believe in the longer-term value of their platform.
Our investment approach
As the portfolio managers of Invesco Global Opportunities Class5, we don’t try to predict what the market may do six months from now, make guesses about what the U.S. Federal Reserve will do on interest rates, or even make predictions about the policies any U.S. presidential administration will pursue.
We simply spend our time searching for companies which we believe are leading the way in transformational technologies through patent-protected intellectual property. The companies in which we seek to invest have used these resources to build businesses that may enjoy a high probability of strong future growth.
The improvement in medical diagnostics is a theme we’re excited about — and we believe it may position us to benefit our investors in the years ahead.
1 Source: Cancer.net, “Colorectal Cancer: Statistics,” January 2021
2 Source: Centers for Disease Control and Prevention, “Colorectal Cancer Statistics,” 2018
3 Source: US Preventive Services Task Force, “Colorectal Cancer: Screening,” May 18, 2021
4 Source: Cancer.org, “Study: More Breast Cancer Patients Can Safely Skip Chemotherapy,” June 4, 2018
5 On May 3, 2021, Invesco Global Small Companies Class was renamed Invesco Global Opportunities Class and the Fund’s investment objectives and strategies were changed. The performance of this Fund for the period prior to this date would have been, and the quartile rankings may have been, different had the current investment objectives and strategies been in place during that period.
