In a Dec. 1 research note, Cowen analyst Dr. Joshua Jennings reported that Quotient Ltd. (QTNT:NASDAQ) announced "strong concordance results" from the recent European Union (EU) field trial of its MosaiQ Expanded Immunohematology (IH) Microarray transfusion diagnostics platform.
"These data represent a significant milestone in the MosaiQ development journey as the system is now on the cusp of EU commercialization," Jennings added.
MosaiQ is a fully automated, consolidated testing platform that should increase efficiency and productivity. "It is expected to perform all mandated serological disease screening tests, such as HIV and hepatitis, and enable the detection of additional pathogens, thereby increasing the safety of the blood supply," Jennings explained.
He presented the preliminary EU data and what they mean for advancing the product. MosaiQ identified antigens A, B, E, e, K, k and Cw with 100% concordance and antigens D, C, c with 99% concordance, to a predicate system. It detected antibodies with 97% concordance.
"The totality of data recorded in these results should rule the day and drive an approval decision," Jennings commented.
That decision is expected in Q2/21, assuming Quotient files a CE mark application that includes the field study results, by year-end, which it intends to do. The biotech will request two CE marks, one for a basic menu and one for a comprehensive menu that encompasses every test in its expanded menu. This strategy should afford Quotient more flexibility when dealing with specific tenders in Europe.
"With an approval in hand, the company will be able to market its first commercial test menu for MosaiQ (Expanded IH + Initial Serological Disease Screening) in Europe," Jennings highlighted.
Cowen expects Quotient to "gain early and medium traction after the 2021 launch," for several reasons, Jennings indicated. For one, key opinion leaders and consultants continue to purport that if MosaiQ can identify antigens, detect antibodies and screen for serologic diseases as well as the existing platforms do then it can disrupt the industry. Also, feedback from EU hypercare sites is reported to have been positive.
The timing should benefit the launch as 15 EU tenders are expected to become available starting in Q2/21 and throughout the ensuing one and a half years.
Further, Quotient's successful commercial debut of its COVID-19 Antibody Microarray bodes well for this next one. With the previous, the company signed up 10 clients within three months' time and has built industry relationships in the process. Finally, the company will be able to easily meet initial demand as it already has inventory, of about 20 systems, on hand.
Cowen has an Outperform rating on Quotient because the "MosaiQ platform has the potential to transform the blood transfusion diagnostic industry," Jennings noted. The investment banking company has a $14 per share price target on Quotient, the current share price of which is about $6.94.
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Disclosures from Cowen, Quotient Ltd., Company Update, December 1, 2020
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