Fundamentals10 Apr 2021 10:45
Is it now as dramatic as yesterday's price drop suggests. Of course not renewing a contract with the DHSC is a line through the bill, but whether this is a big line or a line remains to be seen in my opinion. I may recall that on Wednesday a press release will be issued by the DHS (UK Department of Health) that in the UK testing will be left to the private market and it must be CE marked. I indicated in a message the day before yesterday that this seamless past in the vision and policy of Novacyt, as confirmed once again early this year.
Yesterday's press release, in addition to the disappointing announcement, also stated that:
“Novacyt expects PROmate ™ to be rolled out in the future future in hospitals, private sector and international markets, the company believes that sales of PROmate ™ in the first quarter may be enough to support the NHS's current rollout plans for the remainder of 2021. support ". As also stated in the message, “The PROmate ™ testing in conjunction with the company's q16 and q32 instrument platforms has passed the regulatory CE mark and has been independently assessed by the Technology Validation Group (TVG) in the UK. The TVG supports the use of the q16 / q32 and PROmate ™ system in the patient environment. PROmate ™ is the only direct-to-PCR assay with TVG validation ”.
Finally, there is a demand for its mobile processing labs and SNPsig ® portfolio, both launched in Q1 2021, for certain private sector testing and detection of COVID-19 variants. New COVID-19 lateral flow products are also being developed to expand the company's ability to meet evolving COVID-19 testing requirements.
So again, of course there is disappointment about missing an (important) contract extension, but doing business and doing business is not also right to find the way forward and up the bumps. Until proven otherwise, I still believe in the fundamentals of this company and thus in the future of this stock.