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Dunedin bladder cancer diagnostic company Pacific Edge got a positive first report card from brokers Forsyth Barr's research - but carries a ''speculative'' risk rating.
Pacific Edge is focusing attention on US sales, where it has regulatory approval, several major health provider contracts and its own laboratory, with tens of millions of potential customers.
Forsyth Barr broker Haley Van Leeuwen said the Cxbladder detection product had been trialled and outperformed current accepted benchmark tests and there were several strong propositions for its use in a clinician's regular assessment.
''Cxbladder detect is clinically validated and outperforms benchmark tests, creating a strong case for acceptance by clinicians,'' Mrs Van Leeuwen said.
''The model is highly scalable and we have early evidence of progress in the US,'' she said.
While Pacific Edge had been in the US market for 12-months and had hit several ''key milestones'', changing established clinical processes was ''challenging''.
''Pacific Edge appears to be making some inroads in the US, but it is early days and the commercial model is unproven.
Having spent more than $20 million on research and development, and booked a decade of consecutive losses, Pacific Edge was targeting annual revenue up to $100 million by 2019.
However, Mrs Van Leeuwen pushed out the $100 million timeframe to 2021.
Healthcare and biotechnology was a large area of investment globally and lead times from discovery to publishing, trials and commercialisation ''are typically long'', she said.
''There is a risk that Pacific Edge is unsuccessful in commercialisation and, therefore, has little value,'' she said.
From the maiden research report, Pacific Edge's risk rating was set at ''Speculative - the commercial model is not yet proven''.
She said there was potential for Pacific Edge to become an acquisition target, but Mrs Van Leeuwen expected that was more likely when the company had ''progressed further in the commercialisation process''.