csLumos Diagnostics Holdings Ltd (ASX:LDX, OTC:LDXHF) has quickly emerged as a leader in rapid point-of-care diagnostic solutions, building a foundation to address critical gaps in infection management and women’s health diagnostics while maintaining financial sustainability.
Ingredients for biotech success
For biotech companies, regulatory approvals, clinical and corporate partnerships, and sturdy finances and operations are key ingredients for business success, and Lumos has been moving ahead on all these fronts, setting the stage for an expanded market reach in the coming years.
Under CEO Doug Ward’s leadership, the company has recorded milestones such as US Food and Drug Administration (FDA) clearances for Lumos’ flagship diagnostic products, FebriDx® and ViraDx™, which have gained a foothold in the competitive American market.
“Achieving these clearances from the FDA demonstrates our team’s collective capability and expertise across research, development, regulatory compliance and quality assurance,” said non-executive chair Sam Lanyon.
“Building a strong market presence for these products, especially in the United States, has been essential.”
FebriDx®, a first-of-its-kind rapid test differentiating bacterial from non-bacterial infections, addresses the need for precise infection management in healthcare and will be an important part of the fight against antimicrobial resistance in the coming years.
ViraDx™, a three-in-one diagnostic test for COVID-19, Flu A and Flu B, launched just ahead of the busy US flu season.
“Our team has ramped up production and established distribution channels, even with the challenges of entering the U.S. 2023-24 flu season later than we would have liked,” said Lanyon.
“This progress demonstrates our operational flexibility and commitment to making essential diagnostic tools widely accessible in the healthcare market.”
The success of these products in the US led to an impressive 289% year-over-year increase in product revenue, with FY24 total revenue reaching US$11.1 million – a 6% improvement on the prior year.
Lumos plans to further monetise its two FDA-cleared point-of-care tests through direct sales, licensing and additional partnerships.
Strong distribution partnerships
Building on this momentum, Lumos has firmed up distribution partnerships with Henry Schein, Thermo Fisher and MediGroup, expanding access to these essential diagnostics in the U.S., Australia, New Zealand and several European markets.
A cornerstone of Lumos’ growth strategy is its partnership with Hologic, a prominent player in women’s health.
The partnership, valued at US$14.7 million, involves the co-development of an advanced version of Hologic’s Fetal Fibronectin (fFN) test, used to assess preterm birth risk.
This partnership not only showcases Lumos’ technological expertise but also bolsters its financial foundation; Hologic has already contributed an initial US$10 million as part of the intellectual property agreement, with an additional US$4.7 million in milestone payments anticipated over the next 18-24 months.
Lumos’ proprietary reader platform will support the next-generation fFN test, which will give it the opportunity to showcase its ability to innovate in highly specialised areas and meet the rigorous standards of women’s health diagnostics.
The company is focused on building a pipeline of women’s health assets, to address an unmet market projected to grow significantly in the coming years.
Women's diagnostic health market - worth around $10 billion.
“We are particularly excited to commence exploring new market opportunities in rapid, point-of-care tests in the women’s health market,” said Lanyon.
“With these foundations, my belief is that the broader market will begin to recognise the value of this business and its bright future, which in turn will drive shareholder value.”
Funding for growth
In addition to its partnership with Hologic, Lumos has secured up to US$8.3 million in non-dilutive funding from the Biomedical Advanced Research and Development Authority (BARDA) to support the FebriDx CLIA waiver and pediatric studies.
This funding opens the door to the execution of a CLIA waiver trial in December 2024, which stands to expand FebriDx’s US market up to fifteen-fold, which would substantially increase its market potential beyond the current moderate-complexity label.
The company’s October 2024 A$10 million equity raise, with investment from Tenmile Ventures and Ryder Capital, further supports the company’s growth trajectory.
These funds will be allocated to sales and marketing efforts, product development and working capital, fortifying the company’s ability to scale its diagnostics offerings.
The company has a secure financial base for all this activity, with a net cash balance of US$6.5 million as of the fiscal year’s end.
It considerably improved its cash flow on last year, transforming a US$11.6 million outflow in 2023 into a nearly breakeven position in 2024.
Diverse portfolio
Lumos has also diversified its partnerships beyond infection management.
It has extended an agreement with the Burnet Diagnostics Initiative to develop a point-of-care liver function test for clinical trials and completed a preclinical study with Aptatek Biosciences for a phenylketonuria (PKU) test, allowing home monitoring for PKU patients.
The company has also expanded its manufacturing agreement with Huvepharma for an antibiotic detection test in animal feed – more evidence of its commitment to the fight against antibiotic resistance and an expansion into non-human diagnostics.
