NEW YORK – Fluidigm disclosed on Monday that it has finalized a contract with the National Institutes of Health related to the production of its microfluidics-based molecular test for SARS-CoV-2.
Fluidigm was one of seven companies to share approximately $294 million in funding awarded in July through the NIH's Rapid Acceleration of Diagnostics (RADx) initiative to support the development of a range of new lab-based and point-of-care tests for the detection of SARS-CoV-2. At the time, Fluidigm said it could potentially receive up to $37 million through the program for the development and production of its Advanta Dx SARS-CoV-2 RT-PCR Assay on the company's BioMark HD system. Earlier this month, Fluidigm disclosed that it had received $11 million in milestone funding after the preliminary contract awarded $12 million. The test also received Emergency Use Authorization from the US Food and Drug Administration in August.
In Monday's SEC filing, Fluidigm said that it has "executed a definitive contract with the NIH as an amendment to the letter contract to expand production capacity and throughput capabilities for COVID-19 testing with Fluidigm microfluidics technology."
Under the terms of the finalized contract, funding was increased by approximately $22 million for a total value of up to approximately $34 million upon the achievement of milestones, Fluidigm said. Although the preliminary contract initially specified funding of up to $37 million, the $34 million figure reflects the actual funding after refinements to the project plan, a Fluidigm spokesperson said in an email. The project will be funded in whole or in part through the NIH's National Institute of Biomedical Imaging and Bioengineering.
In late afternoon trading on the Nasdaq, shares of Fluidigm were up 7 percent to $7.74.
In a note to investors, Piper Sandler analyst Steven Mah reiterated the investment bank's Overweight rating and $12 price target on Fluidigm's stock, noting that the firm has opportunistically shifted to COVID-19 testing and offers "a compelling high-throughput solution for small- and medium-sized CLIA labs that we believe fits with the shift toward population-based screening." Mah also noted that two CLIA labs are currently offering the assay.
Mah also said that Fluidigm could potentially receive approximately $120K of revenue per day from each BioMark instrument running at maximum capacity of 6,000 tests per day. He also noted that the test could be highly differentiated as one of only eight saliva-based tests with EUA out of hundreds that have been granted that designation, and because the assay has performed well in early studies.
"We continue to believe CLIA lab testing and rapid POC testing can coexist without cannibalizing each other and thus would be buyers of the stock," Mah said, even given the sharp decline experienced by several COVID-19 molecular test developers in August after Abbott said it had received EUA for rapid POC testing.