ResApp Health Ltd enters trading halt ahead of US trial update

Will ResApp Health Ltd (ASX:RAP) be able to generate revenues?

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The shares of health diagnostic hopeful ResApp Health Ltd (ASX: RAP) have been placed in a trading halt today pending the release the release of an update on its SMARTCOUGH-C study.

The study is being conducted across three top-tier U.S. hospitals with a primary endpoint of diagnosis of pneumonia and other secondary endpoints of diagnosis of other respiratory disorders.

The company claims its smartphone technology can assist in the diagnosis of respiratory diseases when a patient coughs, with real time analysis by using the phone's built in microphones.

If the company meets its trial goals it plans to apply to the US FDA for approval to commercialise its "lead pediatric" product. The outcome of any potential application remains unknown.

The company currently has a market value around $200 million with no revenues and just posted an operating cash loss of $1.82 million for the quarter ending June 30 2017. It had cash on hand of $8.55 million as at June 30 2017 and forecast $2.23 million in estimated cash outflows for the upcoming quarter.

Given its valuation around $200 million, it seems some in the market have high hopes that it will be able to generate substantial revenues and profits in the future.

Motley Fool contributor Motley Fool Staff has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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