As previously reported, Craig-Hallum analyst Alexander Nowak downgraded CareDx to Hold from Buy with a price target of $9, down from $26, arguing that the "worst-case scenario just occurred" with Palmetto MolDx announcing an update to its Billing and Coding ruleset for the umbrella coverage determination that "dramatically changes reimbursement for transplant testing." The policy appears to eliminate HeartCare reimbursement and "make KidneyCare reimbursement a non-starter," while it also "dramatically weakens" reimbursement for kidney transplant testing when used in the surveillance setting, the analyst tells investors. The firm estimates that at least $15M of revenue is from HeartCare, specifically the AlloSure Heart component, and this "will be reduced to $0."
Published first on TheFly
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