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Concepta: THE INVESTMENT CASE

Concepta receives first order for its myLotus fertility products

The £225,000 order is from HuanZhong Biotech, Concepta’s partner in China
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Total losses for the year are still expected to be in line with current market forecasts

Concepta PLC (LON:CPT) has received its first sales order for its myLotus fertility products.

The order – from HuanZhong Biotech, Concepta’s partner in China – is worth £225,000 (RMB 1.95mln).

WATCH: First myLotus sales order 'the key milestone' so far for Concepta, says CEO

Once Concepta has fulfilled the order, HZ Biotech will distribute the myLotus products in China.

The board of the AIM-quoted company expects HZ to make further sales orders in line with the current partner agreement.

‘Significant milestone’

“This is a positive and significant milestone for Concepta and is the result of close co-operation with our Chinese partners, who have helped us refine our market entry strategies into China,” said chief executive Erik Henau.

“This first order allows us to test our three identified routes to market (IVF clinics, direct to consumer and hospitals) and we expect to make further announcements in the future as we look to expand our distribution network in China.

“We are now in a position to activate the whole supply chain, leveraging core UK elements configured to provide a scalable international supply chain.”

Next stop Europe

In Europe, MyLotus is awaiting regulatory sign-off in the form of a CE Mark and is hoping to accomplish this shortly.

Here it will sell the product online as there is a fairly well defined, accessible potential user base that is well informed about fertility innovations.

 “Excitingly, Concepta has the opportunity to translate its proprietary platform into commercial success in these initial markets where annual revenues in the infertility segment are estimated to be worth around £600mln”.

In January, it achieved the ISO13485 management accreditation, which it says was a key step towards European regulatory approval.

Concepta wants to launch myLotus into the £350mln UK and Europe market in the second half of this year and the management accreditation will endorse its position as a medical device manufacturer, it said.

“The accreditation is recognised on an international scale and is a critical part of gaining regulatory approval for Concepta's myLotus to be sold in the European Union.”

Full-year losses guidance maintained

Concepta’s original plan was to generate its first sales in the first quarter of this year. Given that it has only just received its first order, the company expects turnover for the year will be below market expectations.

However, management have been keeping a lid on costs which means the total loss for the year should be in line with current market forecasts.

myLotus a unique treatment

MyLotus – which will retail for £250-£300 – is an easy-to-use home test that has been developed for women who have been trying to conceive for six months or more.

It measures hormone levels in urine to give quantitative and qualitative measurements that might help explain the apparent lack of fertility.

Competitor products currently only allow qualitative measurement and are based on the 'average woman'.

Stress tests the next development

Concepta has more than just myLotus in its armoury, though; it’s currently working on a stress test to help both women and men with fertility problems.

A technology transfer and licence agreement has been agreed with Selective Antibodies, a UK based diagnostics company.

Concepta will be given exclusive rights to rights to Selective’s intellectual property in return for fees and a royalty on any products sold.

At present, the Lotus platform capabilities include measurements of a woman's personal hCG and LH hormone levels.

With Selective’s input, Concepta wants to expand this reach to quantitative measurement of stress hormones such as cortisol.

“Stress is a common cause of several health conditions and is widely recognised as a key factor, which can significantly impact both male and female fertility factors,” the company said.

Henau added myLotus’s key differentiator is that users can quantify their personal results from home diagnostic tests.

 "We believe our myLotus platform opens the door to wider health monitoring at home to improve individual health parameters, seeing the real-time effects of medical interventions and using the data collected to adjust treatment accordingly.

 "As such, our first collaborative project, with Selective Antibodies, is focused on stress, which has a significant documented impact on both male and female fertility.





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The £225,000 order is from HuanZhong Biotech, Concepta’s partner in China

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