As Stock Rises, Hycor Biomedical Hopes Profits Follow
Hycor Biomedical Inc.’s stock rose to a 52-week high Wednesday after the Food and Drug Administration cleared three of the Garden Grove company’s autoimmune test kits for marketing.
Hycor President and Chief Executive J. David Tholen said he hopes the stock’s move signals that the market is finally recognizing the diagnostic-product maker.
The FDA now has cleared 18 tests developed by Hycor and should make a decision on four more tests in four to six months, Tholen said.
Tholen said he expects Hycor to seek FDA approval to market six more tests by the end of this year.
But profits have been elusive at the company, which underwent a management shake-up last year after its longtime chairman and chief executive, Richard D. Hamill, failed to achieve a financial turnaround. Tholen replaced Hamill as CEO.
Hycor hasn’t posted a quarterly profit in more than three years. The company’s losses totaled more than $10.8 million during the last two years.
The company’s stock moved up to $2.50 a share Wednesday during Nasdaq trading before settling back to close at $1.84, up 47 cents, or 34%. A total of 728,500 shares changed hands, compared with average daily volume of 27,444 shares over the last three months.
The products approved by the FDA on Wednesday test for the presence of antibodies associated with anti-phospholipid syndrome, pernicious anemia and Goodpasture’s syndrome. Unlike most competing tests, Hycor’s allow for both manual and automated review.
Due to the difficult nature of diagnosing autoimmune diseases, Tholen said, the three tests may be used much more often than the occurrence of the diseases in the population may indicate.
Anti-phospholipid syndrome, which occurs in about two out of every 100 people, causes abnormal clotting in veins and arteries, spontaneous abortion and low platelet counts.
Pernicious anemia prevents the stomach’s lining from adequately absorbing vitamin B-12. It occurs once in about 1,000 people.
Goodpasture’s syndrome, which occurs only once in 100,000 people, causes excretion of protein and blood in urine and kidney failure.
Although Tholen wouldn’t provide the company’s expected revenue from the three test kits, he said payback on the company’s HY-TEC 288 automated immunoassay system, which processes the tests automatically, has been “very, very good.” He estimates a return of about $32,000 to $40,000 for each system the company places with laboratories.
