Investors in diagnostic testing firms such as Omega Diagnostics and Avacta were provided with a timely boost in sentiment from the world’s largest rapid COVID-19 test manufacturer today.
While investors have faced something of an unsettling wait for the commercial prospects of the aforementioned stocks to come to reality, testing giant Innova revealed that the UK market for lateral flow tests will continue to be big.
It is expected to be so big in fact, that California-based Innova is establishing a factory in Wales to help serve continued and expected demand from the UK with millions of tests ready for the summer:
“When you look at it, the more we travel the more mixing of variants there will be”CEO Dan Elliott
Speaking to the Financial Times, Innova CEO Dan Elliott revealed that he expects demand for lateral flow tests in general to be high for the next three to four years; one of the main contributors to that will be emerging variants.
Signs of optimism for investors in Omega Diagnostics and Avacta
The move from Innova to commit to ‘large investments in the UK’ following news some time ago that the government wants to focus on UK-based diagnostic companies is encouraging for relevant UK-based stocks.
In the report, the FT notes that so far only SureScreen has been able to supply tests in the UK under the new framework.
However, it is widely known that Omega Diagnostics is just waiting in the wings to produce a test of the government’s choosing ( Hancock and the government gives a public thumbs up to Omega Diagnostics ). Likewise, there are big hopes on Avacta ( Avacta shoots down rapid test selection reports as it confirms government dialogue).
For the world leading rapid test manufacturer to set up shop in the UK (and produce millions of tests by the summer) even when the government has established new partnerships elsewhere should provide hope that it continues to be a matter of when not if a sizeable deal is announced for Omega and Avacta.
The news flow may have stalled as of late, but investors will be hoping no news is good news!