Zomedica Pharmaceuticals shares spiked last week on huge volume following an announcement from Qorvo Biotechnologies, Inc.(NasdaqGS: QRVO) that they have achieved a key milestone in the development of a veterinary point-of-care (POC) diagnostic platform for Zomedica. Shares of Zomedica (NYSE American: ZOM) (TSX-V: ZOM) traded more than 10X average daily volume on Thursday, and the stock closed higher by roughly 30% by the end of the trading day.
The achievement by Qorvo follows Zomedica’s own previously disclosed announcement that its TRUFORMA™ platform and first assay have completed final verification. The combination of the two announcements is a critical milestone in enabling commercial manufacturing production capabilities.
The companies signed a development and supply agreement in 2018 with a focus on Zomedica’s TRUFORMA™ platform, which can become a first of its kind point-of-care platform designed for veterinary use. Terms of that agreement call for Qorvo to develop the POC diagnostic instrument and related assay cartridges, while Zomedica is responsible for the validation, marketing and sale of the assays, instruments, and associated assay cartridges. The TRUFORMA™ platform uses Qorvo’s differentiated sensors, derived from the fundamental bulk acoustic wave (BAW) technology that is deployed in approximately 2 billion devices worldwide. According to the Qorvo release last week, this new POC application combines expertise in RF devices, microfluidics and medical test platform integration.
Now, Zomedica is looking to bring this innovative, first of its kind POC device to market, and with it a large share of the estimated $2.7 billion companion pet diagnostic and healthcare market expected by 2024.
Zomedica Focused On Novel Veterinary POC Applications
Zomedica Pharmaceuticals is one of a few companies intent on developing and bringing to market innovative, point-of-care animal healthcare products designed to quickly and efficiently diagnose and help treat companion animal diseases. With the Qorvo milestone, Zomedica is a giant step closer to delivering its TRUFORMA™ device to support new standards around point-of-care.
TRUFORMA™ is a point-of-care diagnostic platform that is proving to have substantial advantages compared to traditional options. The device, which is smaller than a desk-top printer, will beused to diagnose thyroid and adrenal disorders in dogs and cats. Zomedica’s late-stage confirmatory studies are providing reliable proof-of-concept data, suggesting that TRUFORMA™ may have the capability to replace traditional methods for diagnosing thyroid and adrenal disease in dogs and cats. The product’s most appealing advantage is that it eliminates the need to send patient samples to an outside lab for testing. In addition to expediting results at point-of-care, the in-office data can result in immediate and appropriate patient treatment, eliminating an often-multi-day delay getting results from outside laboratory sources.
Further, TRUFORMA™ is expected to be marketed as a first of its kind diagnostic tool that can provide substantial benefits to veterinarians and their teams by giving them the ability to take control of testing, diagnosing, and treating patients in a single clinic visit. Additionally, the point-of-care TRUFORMA™ biosensor platform is not only proving its ability to deliver lab-quality testing, but study data to date for several of the initial assays also suggests that the TRUFORMA™ platform may be the only point-of-care diagnostic device capable of analyzing a serum sample and delivering accurate, reliable results in approximately fifteen minutes.
The initial assay focus is centered on testing for thyroid and adrenal disorders, two common conditions in companion animals. Additional assays that help to demonstrate the scalable design of the device are already in development and have the potential to broaden the TRUFORMA™ platform by including assays to test for non-infectious gastrointestinal disorders, renal disease, and diabetes. Long-term revenue models are based on the company’s use of the razor/razorblade business model for its diagnostic cartridges.
TRUFORMA™ Can Be A Game-Changer For Veterinary Practices
The tabletop TRUFORMA™ device can provide quick and reliable results from only needing a small patient sample, often requiring just a small blood draw from a dog or cat. Another advantage of the TRUFORMA™ platform is its use of BAW technology, which works by detecting changes in resonant frequency. BAW technology, also used in cell phones, is an extremely reliable, precise, and well-tested technology, and Zomedica has been recognized for being a forward-thinking company by applying this well-established technology in a new and innovative manner.
Seizing a significant opportunity in a billion-dollar market segment, TRUFORMA™ is combining its ease of use, accuracy, and rapid delivery of results compared to competing diagnostic methods, to position itself as a point-of-care instrument of choice that can enhance the patient, client, and clinician standard of care.
Moreover, in addition to its speed and cost advantages, the device’s practical superiority is creating distance from other diagnostic equipment devices because of the IP technology embedded into TRUFORMA™, which can deliver reference lab-quality testing directly to veterinarians and their teams in the clinic. That benefit allows the treatment team to have greater confidence and flexibility to diagnose, treat, and improve patient outcomes and pet owner experiences, and further streamline their own practices by eliminating the time and labor required to send samples to a reference laboratory for testing.
Seizing A Market Opportunity
With the Qorvo announcement last Thursday, Zomedica’s opportunity for near-term growth is enhanced. Plus, that opportunity can extend from several fronts. First, Zomedica has compelling products that are nearing commercialization and are on track to launch its first revenue-generating diagnostic product. Second, they can reach those milestones by leveraging the experience of its Chief Commercialization Officer, Bruk Herbst, and independent director, Johnny D. Powers, both of whom held high-level leadership positions at industry-leader, IDEXX. And, third, Zomedica is focused on bringing to market first-of-its-kind devices that not only provide potential best-in-class results far quicker than conventional methods of testing but can do so far less expensively than competing options.
Zomedica’s value proposition is revealing itself. Combining the company assets, from both a product and management perspective, the tools are in place to drive shareholder value substantially higher. Moreover, with Zomedica focused on making vet-care markets better, the company is well-positioned to tap into a multi-billion-dollar combined market opportunity that has the potential to make the remaining part of 2020 a breakout period for the company.
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