Shares in Avacta have been on a mysterious near 40 percent surge in two days amid increasing talk by government sources that rapid antigen test is going to be key to to getting people back in sports and entertainment venues.
While there has been no official update from Avacta, shares have bounced from 104p to 144p in the past few days following its recent lows amid all the positive news regarding COVID-19 vaccine candidates.
Previously Avacta boss Alastair Smith indicated that demand for rapid antigen test could reach as high as 100m per month in the UK (Going for growth: Avacta primed to rapidly get the world moving once again).
While culture secretary Oliver Dowden has been positively touting a return to sports venues prior to the COVID-19 vaccine news, speaking to TalkSport today, Dowden reinforced this view of same-day rapid testing before fans could enter a stadium:
“After December 2 we will go back into the tiers and I have to warn you that the tiers are going to have to be pretty tough to keep this [virus] under control.
“But I’m certainly making the case for fans to start coming back in a safe way as part of that process. I hope to be successful [with that bid].
“We’re also looking at [the possibility] as we roll out further testing – we’ve got more and more of these available – a real opportunity to incentivise people by saying if you take the COVID-19 test then you can go safely into stadiums and watch matches.”
News of a COVID-19 vaccine will do little to take away from the fact that the government will need a reliable rapid antigen COVID-19 test to sustainably reopen the economy. A successful vaccine is likely to be at least 4-5 months away from any kind of widespread roll-out. Hence testing will be needed.
Avacta has been rumored by tabloids to be involved in moonshot and the government previously confirmed that it was looking at its saliva-based technology.
With no official market announcements, the surge is certainly intriguing – particularly as Avacta has relatively sizeable m.cap at over £330m.
Dowden’s optimistic comments have given a renewed sense of hope to the importance of such testing and potential volume of it.
However, investors are still playing a guessing game as to whether Avacta will be heavily involved or not. If it is, needless to say where this will be heading next.