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I just watched the latest Avacta video from Sir Alistair and on the final slide it says:
"Avacta recently announced that it had generated a large number of Affimer reagents that bind with the spike protein of SARS-COV-2 in order to develop rapid, saliva based, COVID-19 antigen tests with partners including Cytiva (formally GE Healthcare Sciences)."
Key message here: "WITH PARTNERS INCLUDING CYTIVA", ad he also says this too around 7m 35s into the video. Surely this means imminent RNS to disclose this new info.
Video link: https://avacta.com/alastair-smith-video-presentation-sars-cov-2-neutralising-affimer-reagents/
Myles McNulty
@MylesMcNulty
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Replying to
@Aimtowin3
Actually working on a third update note for #AVCT, so not paying too much attention to the SP! Looks wonderful though Thumbs up
After the initial euphoria of the RNS, and the volatility of the stock price reaction today. I think its good to re-assess what the Medusa19 deal really means for Avacta's business.
I think this is a great deal for the company, and MAXIMISES return for us shareholders, and here's why:
Getting experts on e-commerce and distribution on board. No one questions the competency of Medusa19's directors. Key here is shareholder value. Doing this deal means a distribution network can be started to get set up TODAY. Not when the test is approved. It takes time to set up new channels, and Avacta are quite shrewd to start paving the way to get this test out there as soon as practically possible.
Setting up a distribution business is not just about creating a website, and cobbling a few part time delivery drivers together. The global distribution needed for this will be vast indeed. You have to imagine the need to move the test from manufacturers, packaging, organise logistics/freight, arrange financial & legal teams/accounts, get regulatory approvals to sell medical devices in each country - there's a ton of red tape just to sell anything online to consumers. Would anyone do that for a test that has not even confirmed to work yet?
Amazon is a great global platform yes. But even for them to quickly distribute hundreds of millions of tests a month will be a challenge, and not to mention expensive for Avacta to sell this way (no profit share, and still all the red tape as mentioned above). In any case, the exclusive deal however does not preclude us from selling B2B to Amazon, and governments around the world. It is all about timing here, and minimising the delays in the critical path to get these tests to those that eventually will be using it - you and me.
If I put on my contrarian cap on, sometimes you just can't win them all. If we hadn't set up this distribution, until after approval, there will be naysayers going from "Avacta has no test for sale, and not worth £250m market cap" to "so Avacta have the test, but they will struggle to sell it without a sales team/distribution channel". But also imagine the clamour from all sorts of interested parties should this test get approved, and then we discuss sales/distribution. Now Alistair and the team can just direct them to Medusa instead, and focus on the bigger job at hand for Avacta - the Affimer platform.
I'm pretty sure Amazon won't give you profit sharing agreement. And they don't take responsibility for mis-deliveries either. If you look at the Amazon FBA model, they expect you to deliver the product to them, and take the hit for any issues. Not excluded from this agreement with Medusa is that Amazon themselves can buy the tests (as a business) and sell themselves, but from my experience they don't offer you the best price to buy your stock.
It's exclusive direct to consumer only. Non-exclusive for business so Government can buy in bulk still and distribution themselves. Alistair is always one step ahead.
Also note in the RNS:
The Group is intending to establish further rapid test strip manufacturing partners in anticipation of a very high demand for the COVID-19 antigen test.
The final piece of the jigsaw is getting the test mass produced. Cytiva ain't going to make them quickly enough.
Medusa 19 is only recently formed company so no idea how quickly things can be set up.
MEDUSA 19 LIMITED (12568206) Incorporated on 22 April 2020 by HUGHES, Richard Ian
** SAME DAY Avacta generated Affimers successfully**
MEDUSA 19 GROUP LIMITED (12575624) Incorporated on 28 April 2020 by HUGHES, Richard Ian
MEDUSA ASSET MANAGEMENT LIMITED (12580795) Incorporated on 30 April 2020 by HUGHES, Richard Ian
Actually IP Group held 24.8% of the company shares in Oct 2017 - see this presentation slide here https://youtu.be/uPJJaI9XkBA?t=1364
So not even sure if they made much profit really as the avg price of AVCT was between 65-70p!
If you look at IP Group's portfolio news, it says the last Avacta news was the April 8th Cytiva collaboration, and no mention of the 17th FY results RNS, or the 22 April Cytiva update news. They usually include all important news of their portfolio companies (I checked Modern Water, and IP Group do have the May 13th RNS there). So it seems likely IP Group fully exited Avacta when the share price was between 40-65p range.. Not a smart move in hindsight, but they held 17% from at least late 2019 so a pretty significant profit nonetheless.
Good evening all,
This came up on the NCYT board and wbernard posed a valid question about viral load and Affimer effective concentration. It would be a good debate and I've posted Ophidian's messages about this last week as reference. Quite a technical question and would be great to hear opinions on this from our more learned investors.
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LOD inferences 09 May 2020 23:53
after this evenings discussion of LOD I've done a little digging. The Zika Affimer test detects "early" viral loads and from various sources the peak load is an average of 9.9x 10^4 or 99,000 copies per ml this implies that the Affimer detects less than 99,000 as that is pre peak. From the Lancet article on Hong Kong patients,
" The median viral load in posterior oropharyngeal saliva or other respiratory specimens at presentation was 5·2 log10 copies per mL (IQR 4·1–7·0). Salivary viral load was highest during the first week after symptom onset and subsequently declined with time (slope -0·15, 95% CI -0·19 to -0·11; R2=0·71). "
5.2log10 copies per ml is 158,000 copies per ml. So I would say that at onset of symptoms and probably well before the affimer concentration on the strip is more than enough to detect the virus based on Zika.
Ophidian
I will post this on the AVCT board, so can carry it on there. Good evening all.
@Wbernard, could you take a look at this and see if this helps? You bring up a very valid point about the detection limit/sensitivity of a POC test and remembered someone did mention about it on the AVCT chat last week.
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LOD inferences 09 May 2020 23:53
after this evenings discussion of LOD I've done a little digging. The Zika Affimer test detects "early" viral loads and from various sources the peak load is an average of 9.9x 10^4 or 99,000 copies per ml this implies that the Affimer detects less than 99,000 as that is pre peak. From the Lancet article on Hong Kong patients,
" The median viral load in posterior oropharyngeal saliva or other respiratory specimens at presentation was 5·2 log10 copies per mL (IQR 4·1–7·0). Salivary viral load was highest during the first week after symptom onset and subsequently declined with time (slope -0·15, 95% CI -0·19 to -0·11; R2=0·71). "
5.2log10 copies per ml is 158,000 copies per ml. So I would say that at onset of symptoms and probably well before the affimer concentration on the strip is more than enough to detect the virus based on Zika.
Ophidian
Good research here on ABN. If they did hold 10%, thats around 6m shares. Compared to avg volume of 11m shares on Euronext, and 3m here on AIM.. shouldn't take too long for the market to absorb.
Precisely. Antibodies are not grown in a lab. They are generated in animals, and have been since the 70s. You can Google all this stuff. Typically after injecting an inert virus into an animal (usually sheep or mice), you wait till enough antibodies are made in the animal, then the blood is extracted to get the antibodies. Sounds easy right? That's precisely why scientists have been looking for other ways around this.. enter Affimers.
Not a doctor either, but from my understanding I think most antibodies are developed in sheep. This is a slow process, and often batch to batch variability is high. Affimers do not have this issue.
Asked whether he was already talking to AstraZeneca, he said he couldn't say. "Realistically we are talking about at least a 12 month development timeline," said Dr Smith.
Going by Sir Al's past predictions.. AZ will have a cure for Covid-19 out by November.
So much duplicitous comments here. How can some of you point the finger at another company saying because they don't have a product or made any sales dare to have a higher MC than NCYT?! Yet also say that because we have capacity for 10m tests a month and going to make 50% margins the SP should be north of £5? The share price is never just a function of the fundamentals. There are many risks to NCYT not withstanding a superior test, global vaccine, supply chain issues, and not least - sentiment. How many of you will still be here once COVID is over? Heck, I bet a lot will be out once this hits £5.
I know CEOs have commented on other share boards - SKIN/MWG for one.
But if this is true, then perhaps MatthewFowlerCFOGDR could make a post too :)
Fundamentals have always been strong on this stock. It's more sentiment-driven atm, and with other Covid plays having more potential to >double, its easy to see why those that got in early here <£2 are taking what profit is remaining, or those that came in >£4 are bailing. I'm a LTH on this and will continue to add on weakness as the fundamentals will eventually take over.
If there is any dividend, it would have been mentioned in the FY results, but it wasn't. I highly doubt they will pay any dividend, in fact, I'd rather the company reinvest any cashflow back into scaling up the manufacturing.
Plenty of biotech companies with crazy market caps.. Moderna 2019 sales.. under US$100m, market cap $24BILLION!