Genedrive PLC (LON:GDR) has been one of the top risers on AIM during the pandemic, with the share price rocketing over 1,500% since March.
The diagnostics firm has developed two tests to detect coronavirus infections, leveraging its 20-year experience in the sector.
The first, which received the CE marking last month, allows laboratories to analyse assays from 100 patients in 90 minutes.
The Genedrive 96 SARS-CoV-2 Kit is currently being presented to potential clients, with initial sales expected to come in later this month.
According to house broker finnCap, revenues could reach £1.5mln per week, based on partner Cytiva’s scalable manufacturing method of 10,000 beads per hour.
Reaching a total of £75mln per year, gross margin could amount to 60-80%.
The second test, expected to be ready for later on this year, is for use outside hospital settings, such as care homes.
While many companies out there are developing tests, Genedrive says it is one of the few products that makes things easier for laboratories.
Using its product, professionals can simply insert the patient’s sample in a pallet, where it dissolves, and is then put in a platform to analyse.
Most of the competition, instead, provide kits to assemble.
“It’s a bit like going to the restaurant and ordering a meal, but instead of having that brought to your table, they bring you all the ingredients and ask you to mix them yourself,” chief executive David Budd told Proactive.
“You can imagine that everyone’s meal is going to taste different, and some may be more successfully executed than others.”
According to Budd, Genedrive’s test can reduce the margin of error and frustration for those involved in tackling the pandemic.
Moreover, the pallet format does not need refrigeration to keep fresh, so assays are easy to transport and can be shipped anywhere.
This is why the firm is targeting India or countries in Africa, where there are fewer available tests compared to Europe, while it is also looking for a distribution partner in the US.
But the coronavirus assays are just some of the latest developments at the UK-based company.
Earlier this year, Genedrive partnered with supplier of medical technology Inspiration Healthcare Group PLC (LON:IHC) for a test to detect hearing loss in babies.
MT-RNR1 AIHL screens newborns for a genetic mutation, called mt-RNR1, that can cause lifelong and irreversible deafness to a child upon administration of certain antibiotics.
As the world's first point-of-care genetic test designed for use in a neonatal intensive care setting, Budd hopes it will become the new standard of care.
Under the agreement, Inspiration Healthcare will roll out the test in the UK and Ireland, with plans to expand to its 50-strong network of neonatal-focused distributors across the world.
READ: Genedrive hepatitis-C diagnostic joins list of WHO pre-qualified devices; launches £8mln fund-raising
Last month, Genedrive also received a ‘prequalification’ from the World Health Organisation (WHO) for a hepatitis-C diagnostic kit that delivers results in 90 minutes, allowing healthcare workers to operate in the field rather than hospitals.
Prequalified products are recommended to WHO member countries for purchase.
Budd said the approval was “very positive” for both trading and future product applications to the organisation.
However, he recognised that the recent interest from the market was led by the rapid progress of its coronavirus developments.
“From concept to CE marking, we managed to bring a product in eight weeks, a lot of people don’t recognise that normally these processes take a year or a year and a half,” Budd noted.
“There has been an incredible amount of work from everyone.”
In fact, the company took advantage of the share price rise to launch an £8mln fundraise to support both existing and new coronavirus-related projects.
In early May, Genedrive raised £7mln by placing 8.75mln new ordinary shares at 80p each, at a 60% discount to the previous closing price.
It also issued 1.25mln shares, raising £1mln, though an oversubscribed broker option to the placing.
Directors, including its Budd, chairman Ian Gilham and chief financial officer Matthew Fowler agreed to subscribe for a total of 50,000 broker option shares for a combined value of £40,000.
Looking ahead, Budd expects the markets to pay more attention to the diagnostics sector.
“It’s really been great to see the importance that diagnostics companies play in medicine recognised,” he told Proactive.
“We even have the World Health Organisation saying test, test, test and that is very gratifying from an industry standpoint.”
“I have worked in diagnostics for over 20 years, it always feels a little bit like the cousin to big brother pharma, but we know that 70% of all medical procedures are founded on having a diagnostic test.”