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FRIENDSWOOD, Texas - Castle Biosciences, Inc. (NASDAQ:CSTL), a diagnostics company currently trading near its 52-week low with a market capitalization of $471 million, announced Wednesday that its DecisionDx-Melanoma test has received Breakthrough Device designation from the U.S. Food and Drug Administration. According to InvestingPro analysis, the company maintains a strong financial health score despite recent market challenges.
The gene expression profile test provides risk assessment for patients diagnosed with stage I-III cutaneous melanoma, helping to guide post-diagnosis management decisions based on a patient’s predicted risk of metastasis.
"DecisionDx-Melanoma provides valuable biological insights that help inform clinicians’ post-diagnosis decision making based on a patient’s individual predicted risk of metastasis," said Derek Maetzold, president and chief executive officer of Castle Biosciences.
The FDA’s Breakthrough Device designation is granted to qualifying devices that may offer improved treatment or diagnosis of life-threatening or irreversibly debilitating diseases compared to current alternatives. The program aims to accelerate development, assessment and review of designated medical devices.
Castle Biosciences plans to submit a device marketing submission to the FDA for the test, which is currently marketed as a Laboratory Developed Test. According to the company, DecisionDx-Melanoma has been ordered more than 200,000 times for patients diagnosed with cutaneous melanoma through March 31, 2025.
The test has been studied in more than 10,000 patient samples and is supported by over 50 peer-reviewed published studies, according to the press release statement.
Castle Biosciences focuses on diagnostic tests for skin cancers, Barrett’s esophagus and uveal melanoma, with additional tests in development for other conditions including atopic dermatitis. While the company maintains an impressive gross profit margin of 82%, InvestingPro analysis reveals over 10 additional key insights about the company’s performance and prospects, available to subscribers along with a comprehensive Pro Research Report.
In other recent news, Castle Biosciences has entered into a collaboration and license agreement with SciBase Holding AB to develop a diagnostic test for atopic dermatitis using SciBase’s Electrical Impedance Spectroscopy technology. This collaboration aims to predict flares in patients before symptoms appear, allowing for earlier intervention. Additionally, Castle Biosciences has amended its corporate charter following a stockholder vote, adding a new article to limit the liability of its officers under Delaware law.
In analyst developments, Scotiabank has lowered its price target for Castle Biosciences to $40 while maintaining a Sector Outperform rating. This adjustment comes after the company raised its full-year guidance despite discontinuing Medicare reimbursement for its DecisionDx-SCC test and planning to cease its IDgenetix product line by May 2025. On a positive note, Castle Biosciences confirmed the efficacy of its DecisionDx-UM test for uveal melanoma, supported by new data presented at the ARVO 2025 Annual Meeting. This data validates the test’s ability to refine metastatic risk prediction, potentially enhancing patient management. These developments indicate a period of strategic adjustments and advancements for Castle Biosciences.
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