The Genetic Signatures Ltd (ASX: GSS) share price is rocketing higher on Wednesday after the release of an announcement.
In afternoon trade the specialist molecular diagnostics company's shares are up almost 25% to $2.12.
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Why is the Genetic Signatures share price rocketing higher?
Investors have been fighting to get hold of the company's shares this afternoon after it announced a major new customer win.
According to the release, the company has signed a deal with Boston Medical Center (BMC) of Boston, Massachusetts, to supply EasyScreen SARS-CoV-2 Detection Kits.
Management notes that the new supply agreement will provide BMC with an expanded testing capability and that it has been signed during a particularly challenging phase of the COVID-19 pandemic in the US.
The release explains that its target volumes are for 1,000 patient samples per day over the next two years. Though, there is no minimum purchase quantity. In addition to this, Genetic Signatures will provide instruments for testing.
Management has warned that the duration and severity of the COVID-19 pandemic is uncertain and may influence the number of EasyScreen SARS-CoV-2 Detection Kits purchased. Though, if target volumes are achieved this will contribute significant revenue to Genetic Signatures over the life of the agreement.
The first order for US$227,000 has been received and will be invoiced this month.
Genetic Signatures' CEO, Dr John Melki, commented: "The new supply agreement and first North American customer marks a major milestone for Genetic Signatures. We are pleased to be working with the Boston Medical Center, a highly regarded hospital and medical center in the US. As COVID-19 remains a challenge in North America, wide-spread testing remains key to managing the spread of the disease."
"Genetic Signatures remains focused on both growing its global reputation as a leading molecular diagnostics company, and the provision of reliable and accurate diagnostic solutions. While securing new customers across North America and EMEA is a near-term focus, the Company is continuing to market the benefits of more comprehensive screening with our EasyScreen™ Detection Kit range," he concluded.
