Since 2010, healthcare stock LBT Innovations (ASX:LBT) has been refining its AI-powered medical imaging and detection software, a product registered under the name APAS.
Now, none other than AstraZeneca has taken an interest in APAS, engaging LBT to help it fully develop an AI-powered product capable of carrying out microbial quality control.
Instead of LBT using its APAS tech to detect microbial infections in samples from the human body, AstraZeneca wants to see the smallcap’s flagship offering applied to the pharmaceuticals manufacturing lab.
The company’s share price jumped 25% in the first hour of trade, however, volatility was enhanced by LBT’s smallcap nature and liquidity volumes. At lunchtime, gains had softened to 18%.
Based on “technical milestones” being met, AstraZeneca will fund the project up to $1m.
“AstraZeneca leads this field [manufacturing] and is looking to innovate its processes and set the standard for others to follow,” LBT chief Brent Barnes said.
“Our APAS technology is ideally suited for the application of microbial quality control, [so] this partnership is really exciting for the Company.”
Barnes sees LBT’s APAS tech as having what it takes to meaningfully standardise manufacturing practices using the new tech.
“[This will] improve consistency of results and drive standardisation across manufacturing sites.”
The big value-add LBT’s APAS can give AstraZeneca is an enhanced way of monitoring for pathogens or foreign organic elements in a sterile setting.
Drug manufacture is typically carried out in completely sterile environments shut off from the open air and heavily safeguarded against potential points of contamination.
AstraZeneca can use LBT’s technology to automatically monitor each product at the time of its synthesis for microbial contamination, allowing for traceability of each individual pill or vial.
This also eliminates the risk of introducing more workers than needed, from a quarantine point of view.
LBT also claims its technology is better placed than a human eye to monitor for contamination.
LBT Innovations’ 1Y returns for shareholders are down -43%.
The company’s year to date performance, conversely, is up 17.2% on the back of Monday’s announcement.
The company has a market cap of $22.4m at the time of writing and is ranked 141 of 211 healthcare stocks on the ASX
LBT held $2.7m in cash at the end of the September quarter in 2022.
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