OraSure to implement $18M product supply contract from foreign government
OraSure Technologies announced that it will begin fulfilling a contract to supply a foreign government with $18M of product, primarily to support a nationwide hepatitis C testing and treatment program with the goal of eliminating HCV infection across the country by 2020. The contract calls for the purchase of $16M of OraQuick HCV Rapid Antibody Tests and $2M of OraQuick Rapid HIV-1/2 Antibody Tests. This represents the largest supply contract for OraQuick rapid tests in the company's history. The contract provides for product deliveries over a 12-month period beginning in 2016 and continuing through late 2017. The Company expects to recognize revenue over the next several quarters as follows: Q4 2016 - $1.4M; Q1 2017 - $3M; Q2 2017 - $4.8M; Q3 2017 - $7.6M; and Q4 2017 - $1.2M. Approximately 90% of these revenues are for the OraQuick HCV test with the balance being for the OraQuick HIV test. The contract also includes an option for 2017/2018 under which the government may make an additional purchase of up to 100 percent of the original quantities of product on the same terms and conditions as provided in the contract.