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(Alliance News) - Abingdon Health PLC shares sunk Monday after the rapid test developer and manufacturer noted a story in the Daily Mail newspaper that outlined the company's contract with the UK government has been cancelled.
Shares in Abingdon were down 13% in London on Monday mid-morning at 91.88 pence each.
https://www.dailymail.co.uk/news/article-9229507/Taxpayers-foot-87m-bill-ministers-failing-company-Covid-contract-cancel-it.html
The story, Abingdon said, covers recent announcements made by the firm.
On January 26, Abingdon - following delivery of one million virus AbC-19 virus tests for UK Department of Health & Social Care - said no further orders were expected to be placed as part of the DHSC contract. At the time, it noted the contract expired on February 14. Any future orders, Abingdon said, will be via application to future DHSC tenders, but it continues to liaise with the Medicines & Healthcare products Regulatory Agency regarding the use of its test.
The Daily Mail story, published on Saturday, said Health Secretary Matt Hancock had cancelled all further orders "with immediate effect".
The article noted Public Health England requires at least 98% accuracy for antibody tests and its evaluation was that Abingdon's offered less than 85%.
"Twice, the documents reveal, the government was warned by its own lawyers that the deals it signed with Abingdon Health - GBP2.5million for development, GBP10million for components and up to GBP75million for supply - were at 'high risk' of being ruled unlawful if challenged. The advice appears to have been ignored," the Daily Mail said.
In a statement Monday, Abingdon said: "It notes the article published in the Daily Mail on February 6, 2021 and refers investors to the RNS announcements made on December 29, 2020, January 26, 2021 and January 27, 2021 which accurately reflect the company's position and current performance."
At the end of December, Abingdon said it was working with the Medicines & Healthcare Products Regulatory Agency to secure approval for the home use and self-test of its AbC-19 Covid test. But also noted the UK Department of Health & Social Care had the option to cancel its supply of goods contract if a CE mark had not been granted for home use by December 25, but said it was continuing to "work constructively" to enable authorisation.
Abingdon has also previously noted it expects revenue of about GBP7.7 million for its half-year ended December 31, up from GBP1.5 million the year before. Second quarter revenue is "significantly ahead of the first quarter" in terms of revenue, it said. It also previously said it continues to manufacture its AbC-19 Rapid Test in anticipation of further orders and its regulatory department is working toward regulatory approval in 27 territories.
Abingdon Health PLC only listed in London in December, raising GBP22 million. It issued 22.9 million shares at 96.00p, giving the company a GBP92 million market capitalisation on admission.
At the time, Chief Executive Officer Chris Yates said: "The money raised will, amongst other things, enable us to scale up our manufacturing in order to meet the demand for our AbC-19TM rapid lateral-flow test and allow us to further establish our global commercial and operational footprint."
By Paul McGowan; paulmcgowan@alliancenews.com
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