One of the beauties of investing in healthcare, is that you can help make a real difference to the world. This happened with Covid19 after the ‘warp-speed’ creation of mrna based vaccines made by Moderna, BioNTech SE & others.
Similarly another company developing breakthrough technology is LungLife AI (LLAI ), which harvests circulating tumour cells (CTCs) from a single blood draw to identify & treat early stage lung cancer. A disease which globally kills 1.8m people each year - 80% of whom are diagnosed late in the condition, where survival rates are low.
However by deploying LLAI’s patented, well balanced & highly accurate LungLB test (89% & PPV), doctors will instead hopefully be able to identify 80% of lung cancer cases sufficiently early to materially improve treatment regimes.
Ok, so where do we presently stand?
Well at today’s ‘in-line’ 2021 results, the firm said its confirmatory, multi-centre validation study involving 425 participants remains on track, & should finish by Q1’23. After which the clinical data will be analysed, & appropriate regulatory approvals sought, along with US medical insurance cover.
Moreover after the successful IPO in Jul’21 at 176p raising £17m (gross), there should also be more than enough cash available (Dec’21 net funds at $13.8m) to pay for the work - ie until first revenues next year.
CEO Paul Pagano adding: “One in 16 people in the US will be diagnosed with lung cancer in their lifetime - and in many cases when it’s too late. We believe our simple blood test may afford those at risk a much better outcome through early diagnosis.”
Wrt scale, the US market is estimated to be worth around $2.9bn pa.
Meaning that if ultimately LungLife AI captured say a 5% share (or revs $145m). Then on a hypothetical 5x EV/sales multiple, this would equate to a theoretical valuation of $725m (or £20/share) vs $63m today.
Lastly as a major endorsement of the science, LungLife AI is also backed by Mount Sinai Health System (9.7% stake), alongside a “who’s who” of lung cancer experts on the advisory board.
All in all, offering L/T risk tolerant investors, 'break-through medical science at a rock bottom price'.