Premaitha Health’s In Vitro Diagnostic NIPT
Non invasive prenatal testing (NIPT) is a blood test used to screen pregnant women for chromosome problems, as early as 9 weeks in pregnancy. For investors, this market has tantalizing future growth projections. In a report published last year by Transparency Market Research, the global NIPT market was valued at 0.22 billion in 2012 and is expected to grow at a CAGR of 37.6% from 2013 to 2019, to reach an estimated value of USD 3.62 billion in 2019. Currently, four U.S. companies dominate the market; Sequenom; Illumina; Ariosa Diagnostics, and Natera. However, none of these companies offer a NIPT product for in vitro fertilization. One small company in the UK, Premaitha, just launched an in vitro NIPT offering to the market today.
Premaitha Health (LON:NIPT), a molecular diagnostics company based in Manchester UK, just launched today their in vitro diagnostics test called IONA®. It is the first complete non-invasive in vitro diagnostic product for prenatal screening. Today’s launch was the result of achieving CE mark approval (the European equivalent of FDA approval) for their IONA test which analyzes circulating fetal DNA and which claims to have a higher detection rate and a lower false-positive rate than existing tests. While most other NIPT test providers run their tests on the Illumina sequencing platform, Premaitha uses instrumentation from Thermo Fisher. This prevents them from having a supplier who is also a competitor, a situation that truly represents a conflict of interests.
The targeted customers for the IONA® test are the estimated 600 laboratories offering prenatal screening within the EMEA region as well as similar labs throughout the rest of the world. Premaitha’s primary channel to market will be through its own direct sales force targeting laboratory directors. Following the initial launch in Europe, it is their intention to extend sales and marketing activities into Asia. There are no plans currently to target the U.S due to the high regulatory hurdles and the fact that Europe and Asia offer a wealth of market potential.
In July of 2014, Premaitha raised $12.3 million for the development of its IONA test through an Open Offer and started trading on the AIM platform of the London Stock Exchange through a reverse merger. Since then, the share price has appreciated about +70% giving Premaitha a current market cap of around $67 million. Today’s announcement has had a minimal impact on the share price so far with the stock trading up about +4% on high volume and volatility.
Premaitha’s CEO Stephan Little was the former CEO of DxS, another Manchester UK company which developed a set of molecular diagnostic assays that allow physicians in oncology to predict patients’ responses to certain treatments. DxS was acquired by Qiagen in 2009 for a total deal value of $130 million. With his successful track record of building and selling DxS, CEO Stephan Little has shown that Premaitha can raise capital from institutional investors and execute on their milestones so far.
A cursory look at Premaitha’s financials as of September 2014 shows $8.4 million in cash on hand. This was after the $2.14 million spent by Premaitha to list on AIM through a reverse merger, a hefty sum considering they only raised $12.3 million in the offering. The Company has minuscule revenues so far and has spent about $4 million in expenses (excluding the listing fees) for the first 7 months of 2014. It will be interesting to see just how much time and money is needed before investors can start seeing meaningful revenues come in for this first-of-its-kind in vitro NIPT offering.
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