SourceBio International (SBI ) has entered into an agreement to manage the delivery of community-based COVID-19 testing services through the roll-out of mobile testing units.

The Group, which provides integrated lab services and products internationally, said it has partnered with UK intelligence-led security company, Mitie Security Limited as part of the Department of Health and Social Care (“DHSC”) pilot scheme to deliver mobile lab testing.

The pilot was launched to support the Government's community-based testing efforts to ensure that testing is available for surge or increased infectious status in specific regions.

SourceBio said it will manage the delivery of these mobile COVID-19 testing lab services by overseeing all lab operations while it will also take responsibility for all clinical governance, quality assurance, staff training, sample processing and information management.

Larger mobile testing units can process in excess of 1,500 samples a day, with 1,000 tests a day targeted for smaller vehicles while sample results can be returned within 24 hours. 

To date, four mobile testing laboratories using the UK-based company Oxford Nanopore’s LamPORE test have already been deployed in the pilot. According to data, Oxford’s LamPORE test has been shown to be highly accurate for the detection of SARS-CoV-2. 

A study carried out by teams across the UK on over 23,000 samples have demonstrated gold-standard accuracy of the LamPORE test, showing >99.5% sensitivity and specificity, making LamPORE highly effective for testing symptomatic and asymptomatic individuals.

SourceBio said it has worked closely with the DHSC to provide COVID-19 antigen RT-PCR testing services using the Company’s laboratory facility. To date, SourceBio has processed approaching 1,000,000 COVID-19 antigen RT-PCR tests for the DHSC and the NHS, Private Hospital Groups and Commercial customers since first offering its service in May 2020.

The Company said it is now working towards having a continued involvement in a potential UK-wide programme.

"We are very proud to support the UK’s national testing effort to bring gold standard testing to the local communities as part of the effort to get the nation back to work. The need for localised testing and monitoring of infections is critical as the vaccine program accelerates. 

This project also highlights our continued work with the DHSC on multiple fronts as they work to manage the pandemic as it evolves,” commented Executive Chairman, Jay LeCoque.

Investors are now fully aware COVID testing, even after mass vaccinations, is here for the foreseeable future, with recent reports from Boston Consulting Group suggesting demand for testing will still be in the hundreds of millions by 2024 across Europe and the US.

The UK government understands this, and is already preparing to deploy mobile testing units to rapidly deploy to areas where new outbreaks occur, potential averting the spread of new COVID variants such as the recent Kent, South Africa, Brazil) mutations.

Importantly for investors in SBI, today’s agreement with Mitie, to manage the delivery of community-based mobile labs under a pilot scheme, positions SBI at the vanguard of this initiative with the potential (if successful) of rolling the service into any future UK wide service.

Shares in SourceBio International have jumped by over 16% in value since the start of January and today’s news marks its third COVID-19 related testing agreement this year. Last month, the Group told investors that it had secured a deal with an unnamed but ‘major’ UK high street retail and pharmacy group as well as a surge capacity agreement with the DHSC.

As a result of its COVID-19 testing service capabilities, the Board’s expectation for continued significant earnings growth for 2021 across the Company as a whole remains unchanged.

Reasons to SBI

SourceBio International is an international provider of laboratory services to clients in the pharmaceutical industry, the NHS and to private healthcare providers. The Group is headquartered in Nottingham, with additional facilities in the UK, Ireland and the US.

The company saw a positive start on its first day of trading on AIM, adding around £8m to its initial £120m market capitalisation while the £35m raised at 162p is intended to be used by it to scale up COVID-19 testing capacity as well as paying off shareholder and bank loans.

“We are delighted by the strong support we’ve received from institutional investors. Our IPO on AIM allows us to significantly increase our COVID-19 testing capacity, accelerate earnings growth in our core business and execute on potential M&A opportunities,” said LeCoque.

He said at the time of the IPO: “It’s an exciting time for our business and we  look forward to executing on our ambitious growth plans and delivering value to our shareholders.” 

In November 2020, SourceBio unveiled that its funds from its IPO were enabling it to further scale its COVID-19 testing services to deliver against expected increases in future testing.

SourceBio previously forecasted total revenue of around £50m (FY19: £21.2m) and EBITDA of c.£14m (FY19: £3.0m) for the year ending 31 December 2020, with the vast majority of this increase in expected earnings driven by the contribution of COVID-19 testing revenues.

The group said in November 2020 that it had been accepted into the Increasing Capacity Framework Agreement for cancer testing services to NHS England, designed to reduce the significant backlog of elective surgeries impacting the NHS due to the pandemic which is expected to support the growth of the Healthcare Diagnostics business unit in 2021.

SourceBio entered into a strategic commercial partnership with Oxford Nanopore Technologies to offer a COVID-19 testing solution to corporate customers at scale via its own lab facilities. Last month, the group entered into a supply agreement to provide ‘state of the art’ products and lab services to an unnamed high street retail and pharmacy group.

Since December 2020, SourceBio has been supplying COVID-19 antigen RT-PCR testing services to the DHSC. It is currently awaiting a potential formal award under Public Health England's National Microbiology Framework in relation to further COVID-19 testing services.

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