By Bill Alpert
Grail's stock briefly shot from $78 to $100 on Monday after a weekend report that its blood test had found seven times more cancers than were detectable with standard cancer screens. Now the stock has settled back to $75 as analysts pick over the data Grail reported at last weekend's European Society for Medical Oncology meeting.
While the company addressed most data concerns in a Monday conference call, a volatile ride should surprise no one in a business valued at 20 times this year's sales forecast and whose first profits aren't expected until the next decade. Impatient investors shouldn't hold this stock.
In Grail's Monday conference call, it took questions on the Pathfinder 2 study report, which showed that among 23,000 participants over age 50, the Galleri blood test found 133 of the cancers that turned up within a year, compared with just 20 cancers discovered via the standard screening techniques of mammograms, Pap smears, colonoscopies, or lung scans.
There's no existing screen for three-fourths of the types of cancers that Galleri found, because Grail's blood test employs a new technology that finds telltale bits of DNA shed by tumors into the bloodstream. More than half of the cancers found by Galleri in the study were at an early stage, when they might be curable.
Those results will likely impress the U.S. Food and Drug Administration when Grail submits the Pathfinder 2 data next year in its application for marketing approval. By that time, more of the 35,900 people enrolled in Pathfinder 2 will have passed the 12-month point for measuring cancer occurrences.
Analysts on the call asked if the case for Galleri becoming an annual screen for the general population was undermined by the fact that 18 of the 133 detected cases were recurrences among people who previously had had cancer. Grail executives said it wasn't because those patients had previously been thought cured, and were no longer being monitored for cancer.
Other questioners wondered if Galleri's performance had been inflated, because the study followed up an initial positive blood test with a full-body PET scan. The PET scans weren't that useful as confirmation, Grail execs responded. The best confirmatory follow-up turned out to be a second Galleri test -- which is already Grail's standard approach in its existing sales of Galleri under the FDA exemption for lab-developed blood tests.
Galleri should have a good chance to win FDA marketing approval in early 2027. But insurance coverage and widespread adoption will depend on proof that an annual $500-to-$900 multicancer detection test can make a clinical difference for cancer patients -- by finding cancer earlier and reducing its burden of job loss, medical spending, and death.
In other words, will Medicare and commercial insurers think it worth testing 23,000 people with Galleri, to find 133 cancers?
Finding whether a multicancer blood test leads to earlier detections requires a randomized comparison of Galleri-tested people against those not screened by Galleri. Pathfinder 2 didn't do that. But there will be results next year from just such a study now under way by Britain's National Health Service.
Meanwhile, additional evidence in Galleri's favor came out Tuesday, when Oxford University researchers updated the results of a study that has followed 6,000 patients who got the Grail blood test after their doctors suspected they might have cancer. With the passage of two years' time, it turns out that 35% of the patients whose Galleri test was initially thought to be just a false-positive, did indeed turn out to have cancer. The new results show that a multicancer blood test finding should be taken seriously, said the Oxford researchers.
A few investors who are taking Grail's progress seriously stepped up to commit some $400 million more to the company's balance sheet this month. Last week, Samsung agreed to invest $110 million, at $70 a share. Monday, Grail said it got another $325 million at the same price, in a private placement from investors that included Farallon Capital Management and the telemedicine company Hims & Hers Health.
Write to Bill Alpert at william.alpert@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
October 22, 2025 17:25 ET (21:25 GMT)
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