The AnteoTech Ltd (ASX: ADO) share price has returned from its trading halt and rocketed higher on Wednesday.
In afternoon trade, the nanotechnology company's shares surged a massive 95% higher to a record high of 19.5 cents.
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Why did the AnteoTech share price rocket higher?
Investors have been scrambling to buy AnteoTech shares on Wednesday following the release of an announcement relating to one of its customers, Ellume.
According to the release, as we covered here this week, Ellume has signed a US$230 million (A$300 million) agreement with the U.S. Department of Defense (DOD) for its Emergency Use Authorization (EUA) COVID 19 at home test.
Ellume's COVID-19 test is the first at-home test to gain US FDA emergency approval, with the company revealing that it has an accuracy rate of approximately 95%.
Where does AnteoTech come into the equation?
This is a big positive for AnteoTech as Ellume integrates the company's AnteoBind technology into its proprietary quantum dot diagnostics platform. Management notes that AnteoBind uses coordination chemistry and multipoint binding to optimise an assay's conjugation performance. This leads to better tests and better results.
The company advised that it has been working closely with Ellume over recent months to ensure it is able to supply the required volumes of AnteoBind. Pleasingly, management is confident that it has the capacity to fulfil requirements.
Ellume and AnteoTech have a supply contract which has been in place since 2016 and is due for renewal in late 2021.
What next?
Management is expecting Ellume's requirement for AnteoBind to increase modestly over the coming months as it begins to supply the US markets. This is expected to lead to further modest increases in sales volumes and revenue for AnteoTech in FY 2021.
AnteoTech's CEO, Derek Thomson, commented: "We are delighted to be involved with Ellume's success and we congratulate the company on their announcement. Ellume was the original seed customer in AnteoTech's strategy to demonstrate the value that AnteoBind can bring to assay development and it is pleasing to see that strategy now delivering market recogition."
The company is currently working on its own rapid COVID-19 test, the Antigen Rapid Test, which also uses the AnteoBind technology. It is hoping to be able to give an accurate result within 15 minutes of taking the test.
It is, however, unclear how long it will take to be developed, trialled, and ultimately commercialised if all goes to plan.
