What are general expectations of timeframes for signings? My current thought is that we should have all 60+ companies signed up by the end of CY13. I expect them all to sign up because they're not going to have a chance of being competitive if they don't. I think we will see significant delays in revenues (projected above 600million) because up until the contracts are signed the companies will continue to produce stock as they do now (though if they wanted to be uber competitive they would let stock levels begin depleting as soon as a decision to convert had been made, but before a contract was signed - this though would attract attention as they would need to close down manufacturing plants in the interim - loss of staff and the need to re-train new staff might not offset the competitive advantage of a faster switch and it may also frighten shareholders, so I don't think this is highly likely). Which leaves a lag time between signing contracts and selling stock that uses mix and go. Mix and go will immediatedly make the currently used products both more expensive and less sensitive and therefore obsolete. How much would they be willing to write off? I think larger companies are going to be in a better position because the larger scale of their production should give them the advantage of a cheaper cost per unit. However they produce more units, taking the loss back up.
I seem to be going round in circles, anyway the place I was headed - most medical products have an expiry date 2-5 years after production...is that going to be the case with products that mix and go will be incorporated into? Will that therefore be our lag time? So say if contracts signed end CY 13, 600million could be expected approx 2-5 years later?
In the interim there would be revenue from the new products that use mix and go enables such as ( potentially) the new troponin test.
ADO Price at posting:
6.9¢ Sentiment: LT Buy Disclosure: Held
