As patients with Alzheimer’s disease search out a newly approved treatment, they may need MRIs, blood tests and other diagnostics, fueling increased demand for these essential tools. In earnings calls this week, each GE Healthcare and Quest Diagnostics made references to the potential opportunity here, although neither company put any specific estimates behind their comments. “On the dimensions of the opportunity, I feel, it’s a bit of too early to say,” said GE Healthcare CEO Peter Arduini. “I feel, it is not an enormous opportunity in 2023. But for those who look over 2024, 2025, 2026 pending on the uptake of the drug, which goes to be heavily tied to companion diagnostic reimbursement, therapy diagnostic, and the follow-on drugs. We imagine that it is a pretty profound growth opportunity across the space.” GEHC YTD mountain GE Healthcare shares are up 31% yr so far. As for Quest Diagnostics, Gordon Haskett analyst Don Bilson observed that the corporate only mentioned Alzheimer’s disease once in its March analyst day presentation, but on Wednesday’s second-quarter call, it got here up eight times within the transcript as Quest detailed its plans to speculate within the space. “This was all news to us, and it doesn’t appear to have happened by accident,” Bilson said. “Quite the alternative, these companies have apparently decided that there’s something to be gained from being seen as an Alzheimer fighter.” Bilson likened this to how quite a few companies scrambled to detail their artificial intelligence plans. Many hoped that the mere association with AI can be a boon for his or her stock prices — and it often was. He thinks the identical thing might be happening in Alzheimer’s disease. A latest era for Alzheimer’s treatment Little doubt, it is a latest era for treating the mind-wasting disease. The Food and Drug Administration granted full approval of Leqembi in early July. The announcement was quickly followed by Medicare’s decision to cover the treatment, developed by Biogen and Eisai , under certain conditions — a vital step in guaranteeing access to older Americans. Experts estimate there might be as many as 6.7 million individuals with Alzheimer’s disease in 2023, and that number is predicted to extend over time as people live longer. It’s probably the most common type of dementia, and ranks sixth as a reason behind death within the U.S., in line with the FDA. Unfortunately, the antibody treatment is not a cure, but Leqembi does slow the disease’s progression. That may allow patients to live independently for longer. Patients taking the drug receive an intravenous infusion twice a month. Then, the antibody targets a protein called amyloid that’s related to the disease. During treatment, patients might be monitored with an MRI to ensure that there are not any amyloid-related imaging abnormalities, or ARIA, which may be life-threatening in some cases. DGX YTD mountain Quest shares are down greater than 13% for the reason that start of 2023. Early diagnosis might be critical Early diagnosis of Alzheimer’s might be key since qualifying for treatment will depend on patients having only mild cognitive impairment. Typically, when dementia is identified, MRIs, CT and PET scans are among the many tools used for diagnosis. Other methods comparable to spinal taps or biopsies also could also be a part of the combination. Quest and other companies comparable to C2N Diagnostics are working on developing blood tests that may be used for screening. Quest’s test measures the ratio between two peptides of amyloid beta, that are an indicator of the disease. It stays to be seen how many individuals will search out treatment with Leqembi, since taking the drug presents significant logistical hurdles, especially for older adults — amongst them, traveling to an infusion center and qualifying for treatment. The drug also has risks, which include brain swelling and bleeding. In return, the outcomes could also be limited. Still, Leqembi and Donanemab —a drug in development by Eli Lilly that would turn into a rival if approved by the FDA later this yr — offer hope to a gaggle of patients that previously had none. So what is the takeaway for GE Healthcare, Quest and others within the diagnostics space? “Based on our evaluation, we estimate that as Leqembi usage grows, it’ll only account for [low-single digit] penetration as a percent of the broader MRI capability,” BTIG analyst Ryan Zimmerman wrote in a research note. “That is unlikely to emphasize the system and likewise unlikely to spur a meaningful uptick in imaging unit sales. At ~1% penetration of the AD population, we estimate an incremental ~140k MRIs needed out of ~42.5M annually performed in FY24.” Zimmerman reiterated a neutral rating on GE Healthcare on Wednesday, saying it was fairly valued relative to its peers. In accordance with FactSet, 60% of the analysts who cover the stock rate it a buy, with a median price goal of $90.88, which is about 18% above where shares closed Thursday. As for Quest, most analysts have its shares at a hold, with a median price goal of $147.82, in line with FactSet. That means 10% upside from Thursday’s close. Each stocks have had a down week, but GE Healthcare shares are up 31% in 2023. Quest’s stock hasn’t been as fortunate. It’s down 14% yr so far.