It is involved in one of the hottest areas of biotechnology research – antibiotic resistance – and after $20 million and years of work, SpeeDX, a developer and maker of diagnostic kits, is ramping up its product roll-out as it eyes a big lift in revenues over the next few years.
In the process a decision on either a sharemarket listing or a trade sale is likely over the next 18 months, especially once it wins access to the US market and revs up its sales there.
![SpeeDx is working at the cutting edge of antibiotic resistance.](/web/20161115224141im_/http://www.theage.com.au/content/dam/images/1/3/b/w/l/2/image.related.articleLeadwide.620x349.gso5nu.png/1479078039684.jpg)
And like Resmed, which was launched out of a management buyout a little over 25 years ago of unwanted technology from global major Baxter International and has evolved into a global company worth more than $10 billion, SpeeDx, too, was spawned out of an unwanted development program, this time at Johnson and Johnson.
During the global financial crisis, Johnson and Johnson downsized its local research, which presented the opportunity for Alison Todd, an award-winning scientist, to ensure the platform diagnostic technology she'd been developing made it to market.
With venture capital funds PFM Cornerstone and Talu Ventures, which between them hold around two-thirds of the equity, with Johnson and Johnson retaining a small stake as well, the company's future was assured. Also coming along for the ride more recently was US gene-sequencing outfit Illumina.
Total equity invested to date is more than $10 million with further funds obtained from grants. With venture capital funds coming on board in 2009, after seven years, the clock is now ticking for an exit event.
SpeeDx has invented a platform technology for the rapid testing for infectious diseases with a single test able to identify a large number of viruses, which then enables effective diagnosis and treatment, with the large amount of information positioning it in the evolving field of personalised medicines.
Its first product is a rapid test for the drug-resistant sexually transmitted pathogen Mycoplasma genitalium, which is listed as one of three global priorities by the US Centres for Disease Control. As its symptoms are similar to other sexually transmitted diseases it is often misdiagnosed so carriers continue to spread the infection. And even though it is more than 2.5 times more prevalent than gonorrhoea with a high degree of resistance to existing treatments, there is no US FDA-cleared commercial test for the disease.
With approval in hand to begin sales in Europe, SpeeDx has established a European headquarters and is selling directly into markets such as Britain while it will sell through third parties on much of mainland Europe. Work is under way to obtain approval to sell its first kits in the US, which could take about a year to achieve, with initial sales likely from 2018.
"The next product is respiratory viruses and testing is under way," Colin Denver, the company's chief executive said.
The company's heavy research and development focus is evident from of the staff of 32, 14 are scientists, with the R&D; spend running at $30,000-$40,000 a month, he said.
"We've all worked for big companies – to be out on our own and doing it ourselves is good fun. We're driving our own agenda."