By Brian Marckx, CFA

This morning Transgenomic Inc. (OTC BB:TBIO) announced a significant milestone with the launch of their ICE COLD-PCR technology at ASCO 2012 (American Society of Clinical Oncology meeting).  ICE COLD-PCR affords very high sensitivity and enables sampling from serum, plasma, blood, urine and circulating tumor cells, a significant advantage over conventional PCR which requires sampling directly from the tumor itself. 

Launch of ICE COLD-PCR has been highly anticipated as we believe it represents a significant growth opportunity for Transgenomic.  As expected, the initial ICE COLD-PCR kit is for the detection of mutations to the KRAS gene.  Mutation of the KRAS gene has been predictive of a very poor response to Vectibix and Erbitux in colon cancer.

Roughly 40% of colon cancers are believed to have this mutation which has prompted the FDA to require testing for the mutation prior to treatment.

Transgenomic plans to expand the ICE COLD-PCR cancer testing platform to include other therapeutically relevant mutations including BRAF, EGFR, and PIK3CA.  The versatility afforded by ICE COLD-PCR (can be used on Sanger sequencing instruments) means the potential market for these kits could be substantial. 

We cover TBIO with an Outperform rating and $2.50 price target.