How XPhyto Therapeutics could revolutionise PCR testing

How XPhyto Therapeutics could revolutionise PCR testing
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Canadian life sciences start-up, XPhyto Therapeutics, explains how it is disrupting COVID-19 testing in Europe with its breakthrough PCR diagnostics technology.

Antigen testing, though it is fast and inexpensive can also produce significant false positives and false negatives. This is particularly problematic considering that it has become Europe’s go-to screening procedure for millions of people every day in factories, offices, schools, day-care centres, and so on. Largely because there was no viable alternative.

Meanwhile, the laboratory-based gold standard for testing for coronaviruses – known as PCR (molecular) analysis – is still encumbered by a slow turnaround time in the order of hours to days. For example, air travellers are cautioned that the process normally takes two to three days.

Fortunately, a small Canadian-headquartered life sciences company called XPhyto Therapeutics Corp. has developed a highly disruptive solution to bridge the technological gap between low-tech antigen testing and centralised PCR testing.

Enhancing PCR testing

The COVID-ID Lab takes just 25 minutes to produce a definitive diagnosis. It can be deployed in a range of point-of-care settings, which effectively decentralises the whole testing process. This makes it possible to provide on-site testing and results at numerous locations simultaneously – a potential leap forward in the containment of COVID-19 – a powerful potential pandemic management tool.

XPhyto recently launched COVID-ID Lab in Germany as a commercial in-vitro diagnostic (CE-IVD) test (registered in the European Union) that is one of the world’s fastest portable PCR (molecular) diagnostic testing platforms for COVID-19. In essence, the product effectively combines the accuracy of PCR testing with the speed of disposable screening tests, representing a major innovation within this sector.

Rapid on-the-spot testing and population scale vaccination for coronaviruses, including the Delta and now Omicron variants, has become society’s most effective means of preventing and managing outbreaks

This test system requires significantly less equipment and training than conventional PCR testing labs. It also comes with reduced operating costs plus increased convenience and portability. This explains why the company expects to generate high-volume sales, beginning with Germany and Israel – two countries that are leading the world in the deployment of mass coronavirus testing.

XPhyto’s CEO, Hugh Rogers said: “Our test is designed to detect coronavirus-infected people before an antigen test can, which is only effective when a higher viral load is reached. As a result, many people with the disease have a negative test, feel safe, go to work, go shopping, see friends, and can spread the virus in the process.

“With XPhyto’s testing system, the genetic material of the viruses is amplified; SARS-CoV-2 can be detected even if only small amounts are present. This is how PCR works and why it is the diagnostic standard. For patients, COVID-ID Lab offers them real-time, reliable on-site results.”

The technology was developed in collaboration with Stuttgart-based 3a-diagnostics GmbH – a world-leader in developing disease-detecting medical innovations.

The market for coronavirus testing is likely to grow exponentially to $39.1bn by the end of 2023, according to Allied Market Research. With a near-term focus on Germany, Israel, and the Middle East, XPhyto is negotiating customer-led trials and marketing agreements for large-volume sales. The company just completed a $7m financing, including $4.5m in equity, to finance to acquisition of 3a-diagnostics GmbH.

For investors, this represents a major de-risking event as it provides XPhyto with complete control over the development, manufacture, distribution, and marketing of 3a’s disruptive pipeline of technologies. In other words, it makes for a fully integrated business model.

Besides innovating COVID-ID Lab, 3a is also leveraging off over a decade’s expertise in developing point-of-care screening systems, to innovate next-generation biosensor diagnostics for the rapid, low-cost detection of infectious diseases.

The key takeaway here is that the widespread adoption of rapid, ultra-reliable PCR testing systems, such as COVID-ID Lab, could be critical to helping break the chain of transmission for COVID-19 and its variants. It may also prove helpful in monitoring the effectiveness of the vaccines that are being widely administered in Europe and North America.

By being able to test, trace and quarantine anyone who is sick, health authorities may help to break the chains of transmission and work toward bringing COVID-19 infection rates and their variants under control.

This means that XPhyto is ideally positioned to earn a meaningful share of the PCR diagnostics market in the EU and the Middle East. In short, 2022 should be a breakout year for XPhyto, and bodes especially well for its share price. Just a small percentage of market share would translate into massive revenue.

Why the Biosensor Business is Booming

XPhyto is also targeting the launch of a pipeline of oral biosensor screening tests for bacterial and viral infectious diseases, including COVID-19 – a burgeoning multi-billion-dollar market segment. The first oral biosensor product was registered in the EU in late 2021. This disruptive technology was developed by 3a and the one product under development could take coronavirus testing to the next level.

XPhyto believes this enzyme-activated biosensor has the potential to be commercialised along an expedited timeline, taking months, rather than years.

These biosensors are a combination (chemical conjugate) of a pathogen specific biosensor molecule and an extreme (but safe) bitter compound. When the biosensor is exposed to specific bacterial and viral enzymes, it triggers biosensor activation and release of an extremely bitter-tasting compound, alerting the user to the presence of the specific pathogen.

This oral screening technology is designed to instantly detect a variety of bacterial and viral infectious diseases. 3a’s development pipeline includes biosensor products for influenza A, stomatitis, periimplantitis, periodontitis, and group A streptococcus.

Even though biosensors may not currently be a familiar term to many readers, it will not remain that way, but become as commonplace as has the term coronavirus.

To this point, the market valuation of biosensors is expected to reach $42 billion by 2027, according to the Delaware-based market intelligence firm Global Market Insights (GMI). This would effectively nearly double in size the biosensor marketplace within a few short years.

“Increasing numbers of product launches, coupled with rising adoption of novel biosensors will stimulate the global market expansion,” GMI states in a recent research report.

“Early and precise disease diagnosis is essential for the timely prognosis and the survival of the patient. In recent years, the demand for disposable, cost-efficient, and user-friendly devices with a fast response time has extensively increased.”

Global Market says that biosensors are expected to take on an increasingly integral role in containing and curtailing outbreaks of disease.

“Biosensors have emerged in several fields such as diagnosis, patient health monitoring, detection of disease, and human health management, that will further aid in paving robust growth opportunities in the future,” the report continued.

“Their role in fighting coronaviruses cannot be overstated either,” according to Global Market. “COVID-19 has positively impacted the global biosensors market. These advanced biosensors are employed not only for real-time COVID-19 detection but also as a global screening tool to address control, surveillance, and preparedness in the event of future outbreaks.”

Investment summary

It cannot be overstated that XPhyto’s lead coronavirus diagnostic product, COVID-ID Lab, is a truly disruptive innovation that combines the accuracy of PCR testing with the speed of disposable screening tests. With a turnaround time of only 25 minutes, compared to hours or even days for centralised PCR testing, COVID-ID Lab has the potential to earn major market share. 2022 will be a defining year for the company.

Pending commercial launch of a pipeline of enzyme-activated biosensors could make XPhyto a serious player in the burgeoning market for disease-detecting biosensors – estimated to be worth $42 billion by 2027 (as previously mentioned).

For now, one thing is certain: the introduction of fast, convenient, ubiquitous PCR testing will be crucial to finally quelling the pandemic in 2022, and beyond.

It is also worth remembering that XPhyto is busy organising clinical studies and commercial manufacturing and distribution agreements in Europe and the Middle East and expects to have plenty of news on this front.

On a technical note, the company’s share price still benefits from a relatively tight share structure of approximately 78 million shares outstanding, while its market capitalisation of around CDN $100m. The company also just completed a $7m financing, which includes $4.5m in equity. This is ample funding to complete the acquisition of 3a Diagnostics. XPhyto is primed to be a strong performer in the capital markets during the coming months.

About the author

Marc Davis has a deep background in the capital markets spanning 30 years, having mostly worked as an analyst and stock market commentator. He is also a longstanding financial journalist. Over the years, his articles have appeared in dozens of digital publications worldwide. They include USA Today, CBS Money Watch, The Times (UK), Investors’ Business Daily, the Financial Post, Reuters, National Post, Google News, Barron’s, China Daily, Huffington Post, AOL, City A.M. (London), Bloomberg, WallStreetOnline.de (Germany) and the Independent (UK). He has also appeared in business interviews on the BBC, CBC, and SKY TV.

Marc is also an enthusiastic investor in XPhyto Therapeutics and his commentary is not intended to be a solicitation for other investors to purchase this stock. Investors are always advised to consult an investment advisor before making investment decisions.

Special Report Contact Details
Contact: Knox Henderson
Organisation: XPhyto Therapeutics
Telephone: +1 604 551 2360
Email: khenderson@xphyto.com
Website: Visit Website

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