Advanced Oncotherapy (LSE: AVO), today’s technical update was positive as its seems ‘nearly-almost-certain , that within four months the seven year journey to create, the first LIGHT systems will be completed. LIGHT is the next-generation Proton Therapy (PT) system for cancer treatment, which substantially brings down the costs of what remains a proven, effective cancer cure but at a prohibitive price. In August 2021, £40m was raised at 40p a share with a 1 for 1 warrant at 60p which should be sufficient funding to completion so almost removing the complex projects financial risk. The funding was well supported by several existing investors, notably Philippe Glatz and DNCA investments, and has attracted some new investors, such as Ahlström Invest BV and Cosylab (supplier)and the attached warrants could raise a further £50m.
AVO is developing a compact and modular PT system, which is affordable for the client, financially attractive to the operator, and generating superior patient outcomes. AVO benefits from technology expertise developed by ADAM (a CERN of Switzerland spin-off), but relies on a world-class supplier base which has been interrupted by Covid. The core technical milestones associated with the LIGHT project have over the years, been passed and it is now a matter of completing the assembly of a complex project involving around 15,000 components. At the Interims the completion date slipped due to supply difficulties and the date may have slipped again to end of the Q1. The market potential for the LIGHT system is significant with an estimated worldwide requirement for 4,000 proton therapy centres needed to meet the demand while only 95 facilities currently exist. The letter of intent to purchase has already received for £75m for a three room system and early next year could prove a ‘drop in the ocean’ of enquiries. At 38p the Mkt Cap is £172m and AVO ould be a spectator investment for 2022. Speculative Buy