Jeff Bezos Backed Grail Before It Lost Half Its Value. Here's Whether He Was Early -- or Just Wrong.
The fate of Grail's stock will ultimately be decided in the cost-benefit calculations of medical insurers.
Overview
Multi-cancer early detection (MCED) test company Grail (NASDAQ: GRAL) has some very high-profile backers. None other than Amazon founder Jeff Bezos and Microsoft co-founder Bill Gates were early stage investors in the company, which was then bought by Illumina in 2021 and spun off in 2024. Although the stock has clearly attracted a lot of attention, it also shocked investors with bad news earlier this year, sending it crashing 50%. Still, it's made a comeback in recent months, and it's time for investors to ask whether it's a buy now.
To answer the question, it's important to understand why the stock crashed and why it's already recovered much of its losses. The reason for the crash in February came down to the mixed top-line results of the landmark three-year trial of its MCED test, Galleri, with the U.K.'s National Health Service (NHS).
Details
The idea behind an MCED test is that it will increase early stage (stage I and II) cancer detection so the disease can be treated before it reaches the more pervasive, painful, later-stage cancers (stages III and IV), which are harder and more expensive to treat. As such, the NHS-Galleri test should demonstrate a meaningful reduction in late-stage cancer detection in the test group compared with the control group, as cancers should be detected earlier in the test group. Unfortunately, that's not what the top-line results said: "The primary endpoint of statistically significant Stage III-IV reduction was not observed. However, there was a favorable trend toward fewer Stage III-IV cancers in a pre-specified group of 12 deadly cancers."
Source
Originally published at www.fool.com.