Roughly two months after securing a supply order for HIV Self-Test kit for the South African market back in April 2023, medical diagnostics company Atomo Diagnostics (ASX: AT1) has further bolstered its project portfolio through an exclusive supply agreement with UK-based Newfoundland Diagnostics. This agreement focuses on HIV rapid testing in the European market.
HIV transmission remains a major public health concern and affects over 2.3 million people in Europe, particularly in Eastern Europe. A latest joint report published by the European Centre for Disease Prevention and Control (ECDC) and the WHO Regional Office for Europe revealed that nearly 107,000 people were diagnosed with HIV in the European Region in 2022, also around 17,000 in the EU/EEA.
In becoming a part of the HIV self-test kit market in Europe, Newfoundland placed an initial purchase order for the test kits worth approximately $900,000 to Atomo, at that time subjected to updating Atomo’s existing HIV Self-Test CE certificate to include the relevant distributor information and branding.
The latest supply agreement, however, sees Newfoundland commit to placing a larger follow-on order worth approximately $1.2 million prior to 31 December 2023 which when added to the initial order, secures exclusivity of Atomo-produced test kits for 2024. At the end of the first year of the agreement, the parties have agreed to negotiate an up to 3-year extension, with increasing indicative annual volumes already agreed between the parties for 2024 and 2025.
Commenting on the exclusive distribution partnership, Atomo’s CEO John Kelly said, “We are delighted to have entered into a strategic partnership with Newfoundland and look forward to expanding this partnership beyond HIV testing in the coming months. They have an enviable track record in accessing retail channels where Atomo’s tests are ideally suited to consumer use.”
Kelly also added that Atomo anticipates delivering the first batch of Newfoundland-branded self-test kits to Europe shortly.
Newfoundland is an emerging player in the growing European self-testing market that has arisen out of the COVID pandemic. It has established extensive distribution networks
in Europe, including recent contracts with leading retailers Tesco (British multinational groceries and general merchandise retailer) and Boots (British pharmacy chain) in the UK, therefore partnering up with Newfoundland is expected to provide Atomo with a competitive edge as it enters the European market for the first time.
Being the only HIV Self Test listed on the Australian Register of Therapeutic Goods, the Atomo HIV Self Test provides results in just 15 minutes, boasting specificity and sensitivity levels of 99.6% with comfort to be carried out by lay users in a private and discreet setting. Atomo has sold over four million test kits across its product range in more than 40 countries that it has gained distribution approval from.
In the three months ended 31 March 2023, Atomo acquired $1.1m cash receipts with $864k related to HIV test kit sales and $248k related to original equipment manufacturer (OEM) sales, which was then translated to $598k unaudited revenue. Atomo finished the quarter debt-free and with cash on hand of $8.9m. Atomo sold more than 100k self-tests during the quarter.
In addition to HIV self-test kits, Atomo is expanding into the field of pregnancy self-test kits. The Company has submitted blood-based hCG pregnancy test kits to the Australian TGA for evaluation, and is currently strategising on the pathway for submission to the US FDA. Furthermore, Atomo has received an additional purchase order for 107,000 Pascal cassettes from NG Biotech (NGB). These cassettes will be supplied in markets where the product is already approved and supplied by NGB.
Lastly, Atomo’s patent related to the design and manufacture of its novel blister reagent functionality was granted in both the US and China during the quarter, representing further valuable Intellectual Property (IP) protection for the company’s unique easy to use rapid test solutions in the world’s two largest healthcare markets.
Clara is a Business Reporter for The Sentiment.
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