Why the Alcidion (ASX:ALC) share price is rocketing 11% higher

Alcidion shares are on fire today…

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The Alcidion Group Ltd (ASX: ALC) share price is on course to end the week on a very positive note.

In morning trade, the healthcare technology company’s shares are up 11% to 35 cents.

Why is the Alcidion share price rocketing higher?

Investors have been bidding the Alcidion share price higher today after its consortium won a major contract.

According to the release, the consortium, which is led by Leidos Australia, has been awarded a contract to provide components of an enterprise Health IT Project for the Commonwealth of Australia.

Alcidion will provide the Longitudinal Health Record via its Miya Precision product. The Miya Precision platform will aggregate data from consortium partner solutions and other systems in the environment to establish a consolidated view of every participant health status and history.

The project commencement is planned for December 2021.

What’s the contract worth?

The release notes that the value of Alcidion’s contract is estimated to be $23.3 million over six years. This will cover implementation and a subscription to the Miya Precision platform.

However, further options to take up Miya Observations and Assessments and options to renew up to 15 years creates a possible total contract value (TCV) for the contract with Leidos of around $50 million.

Alcidion’s Managing Director and CEO, Kate Quirke, appeared pleased with the news.

She commented: “Alcidion looks forward to working with Leidos and our Consortium partners to deliver this significant project. The scale and scope are a validation of Miya Precision’s existing capability to provide this critically important longitudinal health record.”

The Alcidion share price has been a very strong performer this year. Following today’s gain, the company’s shares are now up an impressive 88% since the start of the year.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Alcidion Group Ltd. The Motley Fool Australia has recommended Alcidion Group Ltd. 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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