Charles River Laboratories International, Inc. CRL and Insightec announced a five-year strategic collaboration to advance the applications of focused ultrasound (FUS) for drug discovery and preclinical development of therapeutics in neuroscience. Under the partnership, Charles River’s clients will gain access to Insightec’s novel low-frequency ultrasound platform, which non-invasively disrupts the blood-brain barrier, enabling drugs to be delivered to targeted brain areas.

The latest development is expected to boost the company’s Discovery Services business under the Discovery and Safety Assessment (“DSA”) segment.

On the day of the announcement of the news, shares of CRL dipped 0.1% at the close.The DSA arm's performance throughout 2024 was affected by the incremental spending pressures from its global biopharmaceutical client base, which led to a dismal outlook for the full year in the latest earnings report. However, given the impact of this partnership to drive novel therapeutic applications across multiple neurological conditions, we expect the market sentiment to turn around soon.  

CRL is Advancing Neuroscience Research Through FUS Procedure

As a global healthcare company, Insightec is advancing patient care by harnessing the therapeutic power of FUS. Its Exablate Neuro platform uses sound waves, safely guided by MRI, to provide tremor treatment to patients with medication-refractory essential tremor and Parkinson's disease. The company has several clinical and pre-clinical research for future applications in the neuroscience space underway, in partnership with leading academic and medical institutions. Charles River also views the collaboration as a significant step forward in enhancing neuroscience research.

Designed to meet the increasing demand to quickly advance the therapeutic development and delivery of genetic medicines, biologics and immunotherapies in multiple Good Laboratory Practice preclinical models in neuroscience, the partnership provides powerful CNS drug delivery for multiple drug types. Insightec’s technology could revolutionize CNS delivery for genetic medicines, biologics and immunotherapies across a variety of tough-to-treat CNS diseases, including ones associated with neurodegeneration, neurodevelopment and neuro-oncology.

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The importance of technology is pivotal in shaping the future of drug discovery, according to the senior vice president and chief scientific officer at Charles River. The integration of FUS into the company’s preclinical services will enhance the precision and effectiveness of therapeutic delivery strategies, allowing them to refine their use of research models and support the discovery of novel medicines.

Industry Prospects Favoring Charles River

A report by Future Market Insights valued the FUS market at $7.35 billion in 2023 and forecasts it to witness a compound annual growth rate (CAGR) of 6.1% through 2033. The usage of ultrasound technologies for diagnosing patients earlier is known to reduce overall healthcare costs.

Over the years, the healthcare industry has increasingly recognized the benefits of these FUS systems due to their non-invasive nature. Their site-specific treatment of different diseases is proving a major catalyst to market growth. The application of this technology is expected to grow further in the oncology sector, while hospitals are set to drive the market of the systems in the end-user segment.

More on Charles River’s DSA Segment

In July 2024, Charles River announced a collaborative relationship with Autobahn Labs to accelerate the advancement of novel academic science into transformational new therapies across various therapeutic modalities and disease areas. The agreement establishes CRL as the preferred research partner to support Autobahn’s growing pipeline of early-stage, preclinical therapeutics programs by leveraging drug discovery and development capabilities. Under the terms, Charles River has also invested in Autobahn Labs as part of a fundraising round led by Autobahn’s founding investor, Samsara BioCapital.

CRL Stock Price Performance

Over the past year, shares of the company have decreased 5.9% against the industry’s growth of 9.6%.

CRL’s Earnings Surprise History

Charles River has a historical five-year earnings growth rate of 12.1%, surpassing the industry’s 9.6% and the S&P 500’s 8.1% growth. The company also beat estimates in each of the trailing four quarters, the average surprise being 11.6%.

CRL’s Zacks Rank and Top MedTech Stocks

Charles River carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the broader medical space are Boston Scientific BSX, AxoGen AXGN and SiBone SIBN, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Boston Scientific’s shares have plunged 49.5% in the past year. Estimates for the company’s earnings per share have remained constant at $2.40 in 2024 and $2.71 in 2025 in the past 30 days. BSX’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 7.2%. In the last reported quarter, it posted an earnings surprise of 6.9%.

Estimates for AxoGen’s 2024 loss per share have narrowed to 1 cent from 19 cents in the past 30 days. Shares of the company have surged 123.7% in the past year compared with the industry’s growth of 12.7%. AXGN’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 96.5%. In the last reported quarter, it delivered an earnings surprise of 200%.

Estimates for SiBone’s 2024 loss per share have remained constant at 89 cents in the past 30 days. Shares of the company have dropped 29.9% in the past year against the industry’s 12.7% growth. SIBN’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 13.4%. In the last reported quarter, it delivered an earnings surprise of 15.4%.

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