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Quanterix an Exciting Small Cap Growth Play on the Surging Proteomics Theme in Healthcare

by | Sep 24, 2021

Quanterix (QTRX) a small cap that has screened well since our initial report in 2018 and shares +14.65% this year but have pulled back more than 40% from February highs and this week started to work higher out of a base and out of its multi-week pullback trend while support was found into the downtrend at the 61.8% Fibonacci of the 2020/2021 range and VWAP off March 2020 lows. QTRX is also nearing a weekly bull MACD cross signal.

Quanterix is a life sciences company that has developed next generation, ultra-sensitive digital immunoassay platforms that advance precision health for life sciences research and diagnostics.  Its platforms are based on proprietary digital “Simoa” detection technology. The Simoa bead-based and planar array platforms enable customers to reliably detect protein biomarkers in extremely low concentrations in blood, serum and other fluids that, in many cases, are undetectable using conventional, analog immunoassay technologies, and also allow researchers to define and validate the function of novel protein biomarkers that are only present in very low concentrations and have been discovered using technologies such as mass spectrometry. These capabilities provide customers with insight into the role of protein biomarkers in human health that has not been possible with other existing technologies and enable researchers to unlock unique insights into the continuum between health and disease. This insight will enable the development of novel therapies and diagnostics and facilitate a paradigm shift in healthcare from an emphasis on treatment to a focus on earlier detection, monitoring, prognosis and, ultimately, prevention.

Proteins are complex molecules that are required for the structure, function and regulation of the body’s tissues and organs, and are the functional units that carry out specific tasks in every cell. The human body contains approximately 20,000 genes, each of which can produce multiple proteins. It is estimated that these 20,000 genes can produce over 100,000 different proteins, approximately 10,500 of which are known to be secreted in blood. Accordingly, while research on nucleic acids provides valuable information about the role of genes in health and disease, proteins are more prevalent and, more relevant to a precise understanding of the nuanced continuum between health and disease. Protein measurement goes beyond genetic predisposition, reflecting the impact of a range of influences on health, including environmental factors and lifestyle, providing deeper and more relevant insight into what is happening in a person’s body in real time. Researchers and clinicians rely extensively on protein biomarkers for use as research and clinical tools. However, normal physiological levels of many proteins are not detectable in easily accessible blood samples using conventional, analog immunoassay technologies, and many of these technologies can only detect proteins once they have reached levels that reflect more advanced disease or injury. For many other low abundance proteins, these technologies cannot detect proteins even at disease- or injury-elevated levels.

Simoa technology has been cited in more than 1,100 scientific publications in areas of high unmet medical need and research interest such as neurology, oncology, cardiology, infectious disease and inflammation. Simoa platforms have applications across the life science research, diagnostics and precision health screening markets. The addressable neurology, immunology and oncology life science research market is approximately $1 billion per year. As QTRX expands its life science research focus in other areas of immunology, oncology and other therapeutic areas, coupled with growing adoption of decentralized clinical trials, the life science research addressable market is expected to expand to approximately $7 billion. There is also the opportunity to access markets beyond research, such as diagnostics and precision health screening. Research estimates that the diagnostic and precision health screening markets have the potential to reach an aggregate of approximately $55 billion per year, with neurology diagnostics estimated at approximately $18 billion, proteomic liquid biopsy estimated at approximately $20 billion, COVID estimated at approximately $12 billion, and precision health screening estimated at approximately $5 billion.

QTRX currently has a market cap of $1.85B and trades 14.7X FY21 EV/Sales and has posted revenue growth of 64.5%, 50.8% and 52.2% the last three years and with tough comps in 2H21 sees 16.8% growth this year accelerating the next few years back to 30% Y/Y growth in 2023 while profitability remains a few years out.

QTRX is now up to nearly 1,400 third-party peer-reviewed publications validating across 432 different biomarkers. And instrument placements, are now up to 621 worldwide, and continue to run trials inside the Accelerator, Phase I/II/III trials. There’s been over 1,000 Phase I/II/III trials run, and that’s the fastest adoption cycle ever seen in pharma/biotech over the last 5 years.

QTRX has a massive opportunity and well established technology in what is becoming a highly competitive market. It should continue to see strong growth for many years ahead while capitalizing on major secular growth trend across Healthcare.

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