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@Chengdo4 I cannot offer a comprehensive answer to your question but I can provide the following ;

AVCT's work on the Zika virus was a collaboration with The Native Antigen Company (see article below). AVCT employed the NAC's Zika NS1 protein to produce 3 distinct Affimer reagents.

"These reagents are capable of behaving like antibodies to bind to Zika NS1 and form the basis of new immunoassays."

https://www.mercia.co.uk/news-media/news/2016/aug/2/zika-protein-developed-mercia-emerging-star-used-g/

In 2018 the very same company announced the launch of a "new Zika immunoassays with unprecedented specificity and sensitivity." (see below).

https://thenativeantigencompany.com/wp-content/uploads/2019/07/NAC_Zika-immunoassay-press-release-v2.pdf

There is no direct mention of AVACTA in this release and I have been unable to find a further link between the companies on this immunoassay.

It is of course very convenient that the NAC went on to release this ELISA kit based Zike immunoassay, some 2 years after the highly succcessful AVCT collaboration. However, AVCT does have a number of commercial relationships with undesignated clients, whose names are not released for commercial reasons. That said, I must reiterate that there is no direct link to be found, other than the previous 2016 collaboration.

The test was reported to have "sensitivity of 90.3% and specificity of 92.1%."

"This compared favourably with direct testing against a market-leading IgG assay that exhibited only 69.4% specificity."

Trust that helps.

I would add 2 things to that statement borrowed from AVCT.

Firstly, CEO Alastair Smith has, certainly to me anyway, proven himself to be a stand up straight talking CEO, who is not partial to bloated statements.

Secondly, what he said in the presentation latest update was ;

"The consenus view is that hundreds of millions of antigen tests will be required per month to support the fight against the pandemic and initial easing of the lock down during 2020, and to deal with the long term challenge of endemic COVID-19"

So no reference to Antibody tests. That is purely about have I got Covid right now?

As good as AVCT in terms of potential and as successful as their home and mass spectrometer tests, should go on to be, they will not be in business until at least mid Summer.

GDR should be in business by the end of this month and given the numbers involved, are more than capable of ramping up to and continuing to secure, a steady +2m sales line, for a start. I say start because with success and revenues comes further opportunity.

However, I would be more than happy to see this company selling 2m a month.

I am also absolutely flabbergasted that an antibody test would receive so much attention on a BB for a company that is producing a antigen test.

Antibody tests are going to be in high demand and will get some of those much needed key workers back to work. However, as the recent French study demonstrates, the numbers of people that have had Covid, is still very low (France stated as being 4.4%). Double it, treble it if you will, it still leaves the vast majority in the have I got it now bracket, which means an antigen test.

I believe there is far too much analysis of current testing capacities, when said capacities are based on what these governments currently have available to them. If better quality tests in larger quantities were available, they would buy them up straight away. Furthermore, pretty much all testing right now i being judged on what governments and health authorities are achieving. They haven't even really begun to consider home testing because those tests aren't on the market.

Once they are then numbers tested moves away from central government and onto private business and private individual. A massive step change in how countries will manage this virus and open up their businesses and their economies.

If economies are going to truly get going again, then it won't be government led. It will be a great many desperate businesses, that don't have time to wait for their leaders to sort their lives out. That only truly starts once home based rapid testing is available in sufficient quantities. Once that happens then a great many of these hospital based tests should start to recede, as health care facilities get back to doing their day jobs and serving all persons who are sick and not just Covid.

Excellent post SiriusB. I would just like to add that with the greatest of respect intended, UK investors have got to get their heads out of their UK based sand.

Covid is a worldwide problem with several big nations (Brazil, Russia to name but 2), struggling to even get their curve under control.

I am Germany based. A country that has performed exceptionally well during this virus outbreak. However, even here, there are currently no plans for mass gatherings to be allowed. There is limited air traffic. Restaurants and bars will soon open but they will have to operate at reduced capacity and under strict guidelines. They will be in business but business will not be good enough.

How many tests the UK is or is not ordering (never mind the format, design and fundamental basis of the test), is a drop in the ocean compared to what the world as whole is trying and needs to achieve.

@Peckhamrye1 My understanding is that not everybody has to be tested all of the time but clearly the more one can test, the more surety can be given, that any one event or facility, will not lead to a further outbreak of the virus.

If the top 100 nations in the world only averaged 200,000 tests per day, we are talking 20m tests worldwide, or 600m a month.

As faster easier to use tests come to the fore, the hospital based tests, (which we must not forget take up valuable time and prevent those staff, from doing their normal in demand jobs, or working on other equally important viruses and diseases) will start to fall away or be replaced with tests that need less staff or materials.

This is about phases. Governments will want to drive more testing but where possible drive down costs and burden on their services.

Exhibit A

https://twitter.com/UKDiagnostics/status/1260837337732431874?s=20

Key quote from 5th May RNS ;

"The exact performance characteristics of the assay will be determined following data generated with the production batches of assay, and finalised at the point of CE marking."

This very much ties in with the photo and comment posted by Genedrive on their LInkedin account yesterday.

So its looks very much like GDR are producing production batches, right now, ahead of launch.

Anybody can try to sell the idea that the SP could would drop lower but it is of little significance right now.

GDR is about to go live with its test.

@O&W I believe even the very best of us continue to be in denial about Covid. It appears that the human mind isn't capable of coming to terms with the magnitude of what Covid means, for our lives moving forward. A great many still believe that we wake up one day and its all gone away. Or that all we have to do is get the new infections down to zero and life goes back to normal.

We see 10m tests a month and think well that has surely got to have it covered and those plays we are backing might never see the light of day.

I would think the same thoughts have resonated through even the most ardent investors because as i say, it is difficult to contemplate the reality.

There appears to be a disconnection between what the common man/woman thinks and what governments, repsected organisations and medical professionals, keep trying to tell us all, time and time again. Covid is highly likely here to stay. It is highly likely going to be endemic and we are going to need mass testing to get our lives back to normal.

Yes we might get back to our offices. We might get to drink outside, perhaps even inside, our favourite bars and restaurants but 100% of the life we had before, simply isn't coming back anytime soon.

Those bars and restaurants, those theme parks, those aeroplanes, those cinemas, music venues and football stadiums, cannot operate at full capacity, even when Covid numbers are running low. That means that the vast majority, do not have a viable long term future, because 50% does not pay the bills.

Right now there is simply too much focus on what governments are achieving and aiming for with testing because right now that is all we truly have. WE haven't even seen the affects that rapid over the counter testing can/will do to the numbers, to the demand.

In the meantime, many goivernements are covering up the cracks in their organisation, by proclaiming that 100k, 200k, whatever, is enough to get people back to work. But that's simply not true. If they capacity was there to go harder and faster, they would take it all right now.

I can't say that GDR has a long term future in Covid testing but it certainly has a large front end window to exploit, with which to help it cement its financial position and strive to make its other products better and more widely sold.

That's because right now, world wide, governments and agencies are failing on the testing front..

If we then start to add in competitive advantage, ease of use etc etc. Then it is clear that there is a market there, no matter what other bigger names are doing or proclaiming. Headlines are just that. The devil is always in the detail.

@Pdub Whatever people think or whatever differences they may have had with you here, nobody can deny your unwavering commitment and belief, in the BMN cause. You have stood your ground through it all and for that I salute you.

You are a BMN legend and my heart goes out to you and your family for the journey you have now been asked to travel.

@O&W All understood and fully appreciated. I assume you are tying your figures back to the Crowdicity website interview with David Budd?

Assuming the piece is genuine, which it looks to be given the other contributions I have read on there, then yes that adds considerable weight to the argument for being bullish here.

https://mobile.crowdicity.com/testingmethods.crowdicity.com/idea/3237330

What i found more interesting is that the #testingmethods2020 sourcing platform where it is posted, states ;

"We are seeking new and novel solutions to help increase Coronavirus testing methods, supplies and capacity across the UK."

"This platform is a partnership between the Department of Health and Social Care, the UK Bioindustry Association, British In Vitro Diagnostics Association and the Royal College of Pathologists."

So if nothing else, Genedrive are showcasing themselves to UK government and leading medical associations, not that I believe they need that sort of boost, in order to be successful.

The platform authors go on to say ;

"Every idea will be evaluated by our specialists and you will be informed why we won’t progress your idea at this point or to begin collaborating bringing your idea to life with you as partners."

Back to your figures, I had wanted to say that I am expecting a slower ramp up over the first month or two, but the linked in post that I have just seen, is causing me to re-think. It is also encouraging me to believe that the CE Mark must be close, if they are already pumping out thousands of the tests.

Apologies Milcait

@Micait Excellent thank you for that.

Your prompt reminded of another quote, which essentially drive my earlier thoughts posted today ;

"The Directors believe that the Company's skill set is also relevant for developing high throughput laboratory based tests and that the Company will be able to leverage its strong development, manufacturing and commercial relationships in its SARS-CoV-2 tests."

There's those existing skill sets.

All of this strengthens the belief in their ability to deliver on this test.

@Milcait I can't answer that and nor can I say that Sysmex will distribute the test at all. My point was designed to demonstrate that as small as GDR were, prior to developing their Covid test, they were doing some pretty big things with some pretty big partners.

That gives me confidence in their ability to market their test and deliver sales. Whether Sysmex will want to be a part of that, I don't know. What's certain is that a diagnostic distribution company with such reach, that can start in Europe with a CE Mark, will likely want to be involved.

The 5th may RNS stated ;

"The Company will address the market on a non-exclusive basis with sales through an appropriate mix of distributors and direct to customers."

That statement says to me that the company has already established its route to market. Existing distributors with existing relationships, would always be first on the list. Its good for overall business to go that way.

The addition of direct sales, makes things even more interesting.

@peckhamrye1

Yes and it goes further than that ;

4th Feb update also stated ;

"Indian regulatory approval for the HCV ID kit received in December 2019, bringing the total number of registered countries to 14"

Now add in the list of existing distributors that Genedrive has already closed out commercial relationships with.

https://www.genedrive.com/distribution/index.php

Arkray is big and has the contract with Genedrive for the HCV-ID kit for India but Sysmex's list of distributors has to be accessed alphabetically because its so long.

https://www.sysmex-europe.com/n/company/contacts/distributors.html

The company has form and experience in getting tests out to market via distributors. All of which continues to add meat to the bones of belief, that GDR can really get their sales pipeline working well.

Afternoon O&W,

Yes a very valid point regarding GDR not being a one trick pony.

Prior to the 4th Feb 2020 update, GDR was happily trading at 21p for several months.

That update stated ;

"commercialisation of HCV ID kit continues to be slow and delays on shipping orders to the DoD have meant that sales have not been sufficient to offset the anticipated revenue reductions from the expiry of grant funded programmes"

Since then and during this whole Covid outbreak, GDR has ;

"received confirmation that a long-term supply contract with the US Department of Defense"

"entered into a contract for the distribution of the Company's Antibiotic Induced Hearing Loss test (Genedrive® MT-RNR1) in the UK and Ireland with Inspiration Healthcare Group plc" which in turn is expected "to expand the scope of the contract over time to engage Inspiration Healthcare's specialty network of over 50 neonatal focused sub-distributors around the world."

"received World Health Organisation (WHO) Prequalification for the Genedrive® HCV ID kit."

According to the placing update on the AIHL test ;

"The Directors estimate the UK and global markets for this test to be worth up to £3.5 million and £35 million per year, respectively, to genedrive based on a price of £2,000 per Genedrive® unit and £35 per test."

The deal with the DoD has now led to a first customer order of 500 units over 3 years, starting in Autumn 2020.

Having received WHO pre-qualification, the HCV-ID assay, which incidentally "was shown to have sensitivity and specificity of 100% versus the laboratory standard," will surely start to see serious traction, as focus on Covid starts to dissipate.

Given the company now also has a further £8m in cash with which to further improve its products and offerings, I personally feel justified in assigning a conservative c. 50p a share to all of that, even after the placing. That's still only c. £22.5m for a company that is now capable of delivering a profit, even without Covid revenues.

The reason i focus on the Covid angle is because until GDR demonstrate more progress, the majority of the valuation and further target prices, will come from that test's success.

What is key however, is that even mediocre Covid sales will deliver even greater support to those other business lines, adding greater investor security and thus more value to the business as a whole.

All of which shrinks back the value being placed on the Covid test and the revenues achieved from it. So yes, GDR is much more than its Covid angle. No i am not stupid enough to believe Covid isn't key to current valuations but as demonstrated with the quality of their HCV-ID assay, Genedrive aren't simply jumping on the bandwagon, they are delivering something they are used to delivering, which says volumes about what they can go on to achieve, once it is ready to go.

There are always risks to an investment. To remove them all just isn't possible. To test as many as possible is critical.

I remain invested here because there is sufficient evidence now with us, to suggest that GDR can achieve sufficient sales volume, even with these risks, to generate a substantially higher valuation than we see today.

Accepting that things can still go wrong across the board, for me it is still clear that GDR will achieve their CE Mark, they will then ramp up production and highly likely sell their first 6m tests.

Those tests are reported to be being sold at £8-10 a test and able to "achieve attractive gross margins of at least 60%," when "based on its sales volume forecasts."

It is clear to me, that GDR have raised sufficient funds to allow them to purchase 6m tests worth of raw materials and to give them sufficient runway between sales and revenue collection, which in turn will allow them to seek expansion and of course more raw materials.

So the 6m is clearly a starting figure (60% gross margin should be a clear clue to that) that is affordable in relation to what the directors believed was an acceptable amount of funding to raise. Whether others find it acceptable or not, is entirely up to them. I can live with it because whilst it dents the ultimate prize it does not remove a sufficient enough amount to make me want to walk away.

What all that does, given where all countries are with Covid lock downs, where airports are, schools are, mass gatherings are, there is ample runway for GDR to go on and sell considerably more than 6m tests. Contributors can throw as many spanners as they want at this but it won't change that because in the end, it is just too obvious. I suspect a good many of those pushing against this, do not truly believe the risks are as high as they are highlighting. That said, my opinion is just that and everyone has a right to one.

Personally, I believe testing is being underestimated both in its quantity and duration. Also, having a test that can be manufactured in large quantities, does not make that test better. Quality and ease of use will be critical as customers start to gain choice and Genedrive look to have a very solid product, which they believe has competitive advantages and I do too.

So for me, there is ample reasoning to support greater sales lasting well into if not well beyond this year, meaning the risk is on my side, as an investor. That's because right now, GDR is being priced for lower sales based on a shorter term period in its cycle, which is itself being driven by a placing.

That will change, as will sentiment because the fundamentals clearly demonstrate that that is the case. That can change and so it is important to stay alert to that but it is also important to appreciate the facts as they stand and not try to puncture too many holes in it all.

If you are truly new to investing of which I suspect, right now, a good many readers here are, then it is important to get to grips with the fact that you fundamentally on your own. That you are swimming with sharks and there are very few that can help with that.

Investing is about arming yourself with as much research as you can. Finding answers to the questions that bounce around your head, creating doubt and uncertainty.

If you seek those answers from others, then you are selling yourself short and allowing those unanswered voices (be they inside or outside your head), to dictate your path forwards.

If you fail to find those answers out then too many answers will remain and you will need even more mental strength to overcome the bombardment of doubt, that you will need to live through.

If you sit on a BB like this all day, every day, then that bombardment will be greatly amplified and you will likely become even more dislodged from the reality of the situation and those voices will only grow stronger.

Even the very best research has holes. No investment case is bullet proof and every investment has the ability to turn sour.

In addition, every investment goes through cycles, be they short or longer term ones. Professionals play on those cycles and focus on the weak. If you are new to investing or poorly researched, then you are in that club. Tough to hear but inevitable. So arm yourself or you will be parted from your shares for reasons that you did not control.

In the end, fundamentals are what are most important. Share price movements are a distraction that take us away from thinking about them.

I truly feel for all those new investors who have struck lucky on these Covid related shares and now find themselves tested and seeking solace in places where it cannot truly be found.

Research, research and research some more and check it time and time again and if you think you've research enough, then research some more. Leave no stone unturned because the one you do, will bite you the most.

This post does not constitute investment advice, just a well traveled investor sounding off to his computer screen, sharing opinions and ideas without regret or want of retribution.

I'm an investor not a scientist (although I do very much appreciate reading the thoughts of more learned contributors here), so my approach is very much centred around tying facts together.

This is made easier when investing in companies where the management do what they say they will and do not use wording that they cannot stand by, when producing official communication. Again, to date, this is something AVCT management does very well.

During last weeks excellent presentation, the CEO of AVCT answered a question around the predicted quality of their pending Covid test, by saying ;

"Historically, the tests we have developed with Affimers have been very good, in terms of sensitivity and specificity. So we expect that to be the case here as well.”

So we were already looking at being very good on specificity and sensitivity, which means that when that same CEO is quoted in today's RNS as saying ;

"we should have the best possible COVID-19 antigen test."

It means that we should be looking up just how good a antigen test can be.

Like I say, I am no scientist but because I trust what this company officially says right now, I don't actually need to be because they are making it very clear where this is heading.

The 5th May RNS actually states that Genedrive have ;

“secured sufficient supply chain commitments for the most critical components to enable the manufacturing of six million tests.”

Immediately prior to the above statement, they clear state that ;

“On 20 April 2020, genedrive announced that it had entered into a development agreement with Cytiva (formerly GE Healthcare Life Sciences) to allow for high throughput manufacturing of over 10,000 tests per hour.”

What that 5t May RNS was also clear about was that ;

“The net proceeds of the Fundraising will support the rapid development of the Genedrive® SARS-CoV-2 assays, fund the scale-up of the Genedrive-96-SARS-CoV-2 test including build-up of inventory for an initial period”

Key phrases being “scale up” and “initial period.”

Given the size of the global opportunity, Cytiva at a clearly advertised 10,000 tests per hour, isn’t going to be sitting on its hands here.

What this is about is Genedrive securing the necessary additional funding, to pay for its initial batch of raw materials, to feed the hungry machine that is Cytiva.

Once sales take off, which given they start this month, they clearly will because the world remains desperate, then more and more of that 10,000 tests per hour capability, will be exploited.

I would suspect that in these Covid working hour times, 6m tests could easily be run off in under 10 weeks.

GDR is currently undervalued if it just achieves 6m tests full stop.

The evidence points strongly towards it being substantially more than that, be it they need time to build up inventory and further raw materials, all of which will be driven by sales and invoice cycles.

What this isn’t about right now is the most critical factor, demand. That’s abundant.

It’s about getting the first 6m tests out and following up as quickly as possible to ensure continuity of that 10,000 tests an hour process. Then it’s about Cytiva and how many hours those machines can run a week.

Any talk of anything less is just folly in my view.

"genedrive has also secured sufficient supply chain commitments for the most critical components to enable the manufacturing of six million tests. The Company anticipates launching the Genedrive® 96-SARS-CoV-2 in May 2020 at an estimated price of £8-10 per test. The Company will address the market on a non-exclusive basis with sales through an appropriate mix of distributors and direct to customers. The Directors believe that based on its sales volume forecasts and estimates of selling prices in the market, the Company will be able to achieve attractive gross margins of at least 60%, noting genedrive does not fully absorb labour costs into its margins."