[Click eStock] "LabGenomics, Profitability Improvement through LDT Conversion of CliaLab QDX"

Shinhan Investment Corp. forecasted on the 16th that Labgenomics' profitability will improve through the acquisition of Clearlab QDx and the transition to LDT (Laboratory Developed Test).

Labgenomics is an in vitro diagnostics company specializing in molecular diagnostics, NGS (Next-Generation Sequencing), and PGS (Personal Genome Service). It commercialized the first NGS-based non-invasive prenatal aneuploidy testing kit service in Korea. Recently, it has been steadily launching new products related to microbial analysis services, DTC (Direct-to-Consumer), and immunodiagnostics, resulting in continuous growth in non-COVID sales. In August, it acquired 100% of Clearlab QDx, located in New Jersey, USA.

Jiwoo Baek, a researcher at Shinhan Investment Corp., explained, "Among approximately 330,000 Clearlabs in the US, QDx ranks within the top 100 in sales," adding, "Even excluding COVID-related sales, it has an annual sales capacity exceeding 50 billion KRW." QDx has secured stable revenue sources by maintaining contracts with major large insurance companies for over 20 years.

Researcher Baek analyzed, "QDx, which currently purchases and sells IVD (In Vitro Diagnostic) products externally, is transitioning to direct production of LDT." He added, "The company already has raw materials such as reagents necessary for LDT development, and since FDA (Food and Drug Administration) approval is not separately required, there should be no issues in the transition development."

He continued, "The ultimate goal is to produce FDA-approved IVD products," and said, "Through the LDT structural transition and in-house IVD production, both external growth and profitability improvement can be achieved simultaneously."

Additionally, Shinhan Investment Corp. reported that Labgenomics is continuously pursuing a Clearlab acquisition strategy. QDx's main coverage areas are concentrated in the eastern regions such as New York and New Jersey, and acquisitions of Clearlabs covering the western and central regions are expected. By creating synergies among the acquired Clearlabs in key locations such as the East, West, and Central regions, they plan to increase their market share in the US NGS market.