AIM-listed Avacta (LON:AVCT) is at the forefront of the drive to develop testing kits on a large enough scale to help track COVID-19 and prevent the spread of the virus, and ultimately reduce deaths.
The broad testing for COVID-19 is also the first step in allowing non-contagious people go back to work and aid the economic recovery.
COVID-19 mapping
The foremost measure governments can implement to help tackle the spread of coronavirus is the testing of individuals and mapping the potential spread of the virus.
A vaccine, or even effective treatment, is the end goal to help global economies recover to some normality. But we are unfortunately many months away from such medicines being distributed to the extent to bring the virus under control.
In the meantime, wide spread testing will be the most effective method of fighting coronavirus and reopening economies.
Avacta are harnessing their Affimer® technology to use in testing kits that will produce and positive or negative results in minutes, in a similar manner to pregnancy tests.
Avacta are preparing trials for the testing kits, which if successful, would be monumental for the fight against COVID-19.
The market has already begun pricing in the significance of the testing kits to the Avacta share price; the company’s shares have more than tripled to 68p in April alone.
Key to Avacta reaching their goals is ensuring enough cash to facilitate the development programme and complete clinical trials. However, after a recent placing the company should have enough cash on hand to complete trails
“Based on anticipated burn for the COVID-19 test strip as detailed above and its existing programmes, TPI estimates Avacta should still hold cash c.£8.5m by its December year end. It will initiate the Phase I trial of its lead asset late in 2020 and initial data will be available within a few months, but the cash position means that Avacta is now fully-funded to complete this trial,” Barry Gibb, Research Aanalyst at Turner Pope wrote in a note to clients.
“Beyond the obvious reputational and commercial, albeit presently unquantifiable, short and longer-term opportunities that could emerge from its new partnership with Cytiva, this development represents a major inflection point along with potential for creation of significant value for Avacta, while it also forwards its partnered programmes and licensing relationships for its diagnostics reagents.”