Our latest Investing Matters Podcast episode with QuotedData's Edward Marten has just been released. Listen here.
Molnupiravir is not a ticket out of covid or out of testing….
Firstly, it has not been authorised for everybody - “ The UK regulator, the MHRA, said the tablet had been authorised for use in people who have mild to moderate Covid and at least one risk factor for developing severe illness such as obesity, old age, diabetes or heart disease.”
Secondly studies have shown that if you start the course late then it does not have much effect, therefore the need for testing during early stages of symptoms is crucial. “ In its approval document, the MHRA recommends the drug is used "as soon as possible" following a positive Covid test and within five days of symptoms onset.”
It also costs too much. A course costs £513 compared to the vaccine which costs around £2-£3 per jab.
Twatcher good post, fair comments. First time I’ve read one of your comments and not thought “this guys a ********”.
But your right. The govt contract starting would be the biggest short term rerate piece of news that we could get.
Allah you make a point about the government needing to cut down on costs and therefore using cheaper Innova tests. This just is not true as per the article below:
https://www.google.co.uk/amp/s/uk.newschant.com/business/covid-test-maker-mologic-set-to-sue-government-over-stonewalling/
Mr Davis stated: “We are quietly assured that that is the very best fast lateral stream diagnostic on this planet and the UK doesn’t need it. It additionally prices a fourth of the worth of the Innova test.
This then defeats your first point about the government not looking to use reliable sovereign tests. Why would they not use a better test if it was cheaper? Especially if it was made in the UK and they could see a return on their investment through taxes as well as benefiting the economy through the creation of jobs leading to more spending etc etc...
Just had a relisten too. Even through his thick accent you can still make out he definitely says $30.5.
Exact time stamp is 18.05 mins
Why do these scummy people feel the need to chat **** 24/7 and just make up lies
One of these days a RNS will be released where the FDA or EU has granted home approval for Mologic and VISITECT. The share price will shoot up and those who sold will be scratching their heads wondering how the **** they forgot that there is an entire world out there still suffering with covid...
What’s there to moan about?
Contract for up to £374 to manufacture whatever test the government will choose
Now seeking home use approval in EU (we know the Germans love Mologic, and results have shown self swabs does not have a big affect to the results unlike with Innova)
Request for EUA in US under of VISITTECT brand (we know Gates has backed Mologic, they are also being fast tracked through the RadX initiative)
Both these will be successful imo and sales will start to fly once they are. The manufacturing for the government in the UK is and always will be a bonus.
People have been so caught up in that and have forgotten that there’s an entire world out there to supply to.
ODX won’t be producing the Innova test.
The idea of the “sovereign test” inmv is to be used before going to mass events, sporting matches, festivals etc where those at home can take a test before they leave to go to the event.
Currently this is not possible to do with the Innova test because of how hard it is to do correctly by normal people (see below).
https://www.bmj.com/content/371/bmj.m4469
Hey guys,
Not sure if anyone has already confirmed this, but I emailed Wallbrook yesterday to confirm whether the PDF questions by Big Jock were true and Walbrook has confirmed they are.
I have linked the document again for anybody who hasn’t had the chance to read it.
https://pdfhost.io/v/37sAgrkjO_ODXpdf.pdf
Haha nope, a lot of people on this board seem to think ODX has been paying their “almost” 250 employees to sit around and eat haggis all day whilst staring out the window at the lovely hills around them
Looks like a lot of ABC-19 tests are being stored awaiting for the finalisation of the contracts arranged by Abingdon.
https://twitter.com/moneyroots1234/status/1374382652757741574?s=21
If you zoom in on the boxes you can just about make out “ABC 19 Rapid Test”.
Higher risk usually means greater reward, this share is really just down to your risk appetite. If you are the person to panic as soon as you see a bit of red it is probably not the right share for you.
As for those who enjoy the riskier game, remember, the most you can ever lose on a share is 100%. The most you can gain is theoretically infinite.
There is no question about it that if Avacta can produce the same results as they did in their previous sample of 56 patients then they will be the chosen sovereign test (unless there is another who we do not know about).
As an ODX LTH I am not too fussed if this is the case. We know that we will help manufacture whichever test is chosen.
I’m sure Colin and the government have had talks surrounding the choice of test, and I imagine that whichever test is chosen plans will be in place to complete any necessary TT as quickly as possible to help speed up the governments mass testing rollout.
As for the now CE marked Mologic Test, ODX will be able to supply this to commercial partners around the globe, and are already in talks with several of them as stated in the earlier RNS. I do not think we will struggle to sell these, clinical studies show better results than Innova who are planning to massively expand in the UK to manufacture and distribute their test. Why would they do this if they also did not think there would be a market for it.
It’s a shame there is this toxic Avacta vs ODX going on. We are most likely going to be working together, and could both share good information going forward rather than attacking each other...we aren’t even competitors ffs lol
Yea I have left out the others just to try make it a bit more clearer, and I do too. I don’t see the test being sold for more than £5 tbh but can always just change the numbers around and re-evaluate the SP that way.
Yea that’s why I have put at the bottom the factors that will affect this - one of them being the margin made per test
It’s based on a lot of assumptions until figures come in
Thread 3
So contract could be:
£77m for the supply of tests up to March 10th (less if it starts earlier / more if later)
And then like the Surescreen one it’ll be for future supply too.
Worst case scenario would be ODX don’t scale up from 2m a week and supply 92 million tests a year towards this (90% of total manufacturing)
At £11.79 a test that would earn them 1.084 billion in revenue
Margin of 50% gives 542m profit a year
Current UK corporate tax rate is 19%
So profit after tax is £439 million a year for antigen tests (from the point ODX is producing 2 million tests a week)
ODX also have 10% of manufacturing towards the UK RTC Antibody Test:
At the end of December 50k of weekly supply went to this.
By feb this is 80k
By March this is 120k
After April at 2 m tests a week this is 200k
Would have manufactured;
50 x 4 = 200k by Feb
80 x 4 = 320k by March
120 x 4 = 480k by April
Total by full capacity of 2 m a week would be 1 million tests
After that it will be 800k a month
It’s been quoted a test will be £5 at 50% margin so £2.50 per test
That gives £2.5 million for the tests manufactured up to April
For the year after April this will be 10.4 million a year (28000 a day)
This gives annual revenues of £26 million (21 million after tax)
Annual revenue from April onwards:
£439m plus £21m = £460 million
* On top of this ODX will have the £77 million revenue from the supply of the extra 6.56 million antigen tests up to March 10th
* Plus the £2.5 million for antibody tests up to April
* Also sales from CD4 Food Detective test
* HIV test
ODX has no debt so has no interest repayments
Assume they go full out on covid so earn no revenue from their other products.
Ignore the extra £77 million and £2.5 million too, so solely focusing on revenue at full capacity it gives a share price of:
Earnings per share = £460/ 180 million shares outstanding = £2.55
Using a p/e multiplier of 3 gives a market capitalisation target of £460m x 3 = £1.38 billion
£1.38 billion / shares outstanding gives a share price of £7.66 by April 2022
Factors that will affect this share price:
* If ODX scale up from 2 mill tests per week- share price will be higher
* If the price of the tests is less - share price will be lower
* If demand for ODX’s capacity is less - share price will be lower
* If margin made on tests is less (due to costs not included such as machine depreciation) - share price will be less
* If demand is not needed for the whole time - share price will be less
* If the ratio between manufacturing the different tests is different then revenue will be different - share price could be higher or lower
Most likely the cost of the tests isn’t £11.79 for the LFT.
Will probs be less than that so revenues will be lower —> share price will be lower
Thread 2
Surescreen got a contract for £503 million for the tests and to keep manufacturing more tests. The contract value could be for the supply of the tests up to the point where ODX is needed and then will renegotiate it for future manufacturing.
They would have to manufacture over those days 42.66 million tests (22 million plus the extra tests they will be manufacturing over those days)
If £503 million was paid for 42.66 million tests that gives £11.79 a test
When it is March 10th (or later if the government starts rolling out the tests by April) and ODX have to start helping to produce the remaining 0.64m a day they would have stored up:
According to manufacturing scale up diagram in the presentation it was 500k a week at the end of December and 800k by Feb, 1.2m by March 2m by April
10% on the diagram goes to UK RTC so 50k at the end of December, 80k in Feb and 120k in March
Leaves 450k a week end of December, 720k in Feb and 1.18m for other (probs all to this):
So per month they are making:
500x 4 = 2m tests up to Feb
720x 4 = 2.88m tests up to March
1.18 x 4 = 4.72 tests up to April
From then on it is 2 x 4 = 8m tests a month
So by March 10 they will have stored up 6.56m tests (more if they are required after March 10th)
Tests sell for £11.79 if same test that means ODX would earn £77.342 million from those tests.
6.56 million tests would keep everyone supplied at 2 million tests required per day for 10 days after March 10th:
6.56 / 0.64 (ODX’s amount needed to supply to hit 2m tests demanded a day) after 10 March
During those 10 days at 2 million a week ODX could supply for:
0.25 million (90% of 2 million a week) tests made per day x 10 = 2.5 million tests
That could supply the daily demand for another 4 days.
During that time they could manufacture another 1m tests.
Then they could supply for another day until someone new would need to help manufacture to reach the demand of 2m tests per day (unless Mologic, Surescreen or ODX had scaled up and started producing more tests per day)
Total days after March 10 is: 15
So on the 25th March could see another company come into the mix, or ODX and others will be massively scaling up to meet demand of 2m a day (this date could be later if the rollout of 2m tests per day starts later than I’ve put down)
Thread 1:
Please note that this valuation is based largely on assumptions and can change significantly based on the price of the tests, margin made per test, future demand etc.
Have never really done a valuation before and I’m sure I have missed stuff. So if anyone wants to add anything or spots something I have missed feel free to add it to the calculations and give your estimated share price with the new values.
Mologic have stated they are planning on increasing capacity from 45 to 250 million tests a year (Financial Times)
That’s 0.68 million a day (if they can already manufacture that many- worst case for ODX)
The government want 2m tests a day. That leaves 1.32 million tests a day needed to be produced by ODX and Surescreen (So far the only 3 companies chosen to produce the 2 million tests a day)
Sure screen are supplying 20m tests on top of 2m it supplied last month
With 22 million tests supplied straight away Surescreen and Mologic would be able to supply for 16 days without ODX helping (if Surescreen weren’t producing anymore during this time)
The Bidstat award to Surescreen includes the manufacture of more tests in the future.
Assume Surescreen have the same manufacturing as Mologic (0.68m a day) because they both received 11m from the govt for equipment, they could manufacture another 11 million tests in that time. (Mologic are classed as a high-volume manufacture so can’t imagine Surescreen will be manufacturing any more than them. But if they do than it will be longer until ODX’s capacity is needed)
With an extra 11 million tests manufactured they would be able to supply together with Mologic for another 8 days without needing any tests from ODX (11 million tests divided by the 1.32 million remaining demand needed to be filled by Surescreen after Mologic supply 0.68m a day)
During that time they could produce 5.5 million more tests which would allow an extra 4.1 days of supply without ODX
During this time they could manufacture 2.8 million tests and supply for another 2 days.
During that time supply another 1.36 tests which would allow them to meet demand for one more day.
After that at 0.68 million per day for Surescreen and 0.68 million per day from Mologic there would be a need for ODX to supply 0.64 million tests a day to reach the 2 million tests demanded per day.
Total days SureScreen and Mologic would be able to supply for is: 31.1 days
The government announced the supply of 20m tests being supplied by Surescreen on the 7th Feb so they are 9 days in to it
Assuming they were able to supply the 22 million straight away (worst case scenario cos will be the longest time until ODX is needed). That means they can supply for 22 days more so up to 10 March
(Although the government isn’t demanding 2 million tests a day yet, so this date will probs be later. Think they plan on rolling this by April. If this starts at April ODX will be needed by the 22nd April)
Will post
Whilst the last couple of comments haven’t exactly been related to ODX it is so much nicer to read than the usual trash that is posted. Appreciate the moment of serenity guys, no doubt tomorrow will be another ****show on this board
Sentiment seems to have returned on the news today and this is only the tip of the iceberg. So much more news to come, both bigger and better than the news that arrived today! Today’s news has de-risked ODX and each bit of news that comes will de-risk it some more. Jan is going to be a huge month for ODX so everyone strap in! There will be a lot of derampers appearing trying to steal some cheaper shares but don’t listen to them. Always follow the fundamentals, take a look at the little hints towards a bright future and stay safe. Hope you guys have a great Christmas break and I look forward to seeing what happens in the new year.
From Aug 30th unfortunately mate