Venture Capital

Soros and Gates back buyout of UK diagnostic technology group

Read more at www.ft.com

Philanthropists George Soros and Bill Gates are part of a consortium buying a UK developer of testing technology they plan to transform into a social enterprise that can quickly and cheaply diagnose tropical diseases in low-income countries.

The group, led by the Soros Economic Development Fund, will invest at least £30m in Mologic, a developer of lateral flow tests including those used for Covid-19.

In an unusual deal, Mologic, a for-profit company based in Bedford in south-east England, has been bought so it can focus on the low-cost manufacture of diagnostics for tropical diseases such as dengue and river blindness. 

Mologic was co-founded by professor Paul Davis, one of the creators of the original ClearBlue pregnancy test and his son Mark. It will be renamed “Global Access Health”.

Mark Davis, Mologic chief executive, said it was time for people to put Africa first, not leave it the “breadcrumbs”.

“The only way to do more was to delink ourselves from unbridled profiteering,” he said.

He said a rapid antigen test was a “fantastic piece of very simple technology, where all the intellect is hidden from view”. Accuracy rates were improving considerably and might eventually near those of molecular tests, he added.

Alongside the SEDF, the investment arm of the Soros’s Open Society Foundation, the Bill & Melinda Gates Foundation is also backing the buyout of the UK company whose current owners include Foresight Group LLP and Calculus Capital. Other philanthropists are also participating.

Sean Hinton, the SEDF’s chief executive, said the new company would try to address a “classic market failure” in which the industry had failed to make testing widely available in lower income countries. Instead it had focused on a “high cost, high touch” physician-led model in the developed economies, which could not be easily replicated across the world, he added. 

Describing it as a “buyout for good”, Hinton said the Mologic deal was the first time the foundation had used this model. “We have taken out the venture capital, taken out the need for equity return, but it will continue to operate as a business,” he said. 

Mologic worked with a Senegalese research institute to test a 10-minute Covid-19 diagnostic, aiming to eventually make it for $1. Its sister company Global Access Diagnostics, also part of the buyout, received millions of pounds in funding from the UK to expand manufacturing of Covid-19 lateral flow tests.

The company’s Covid-19 tests have received a CE certification, so they can be deployed by a professional in Europe, but are not yet adopted by Public Health England or approved in the US.

Covid-19 has shown how lateral flow diagnostics could be used far beyond pregnancy tests, in an inexpensive way to keep track of an infectious disease.

Dan Wattendorf, director of innovative technology solutions at the Gates Foundation, said the pandemic had been a “clarion call” about the importance of access to diagnostics. He said that if Mologic’s social enterprise model is successful, its use could be explored in other fields. 

“Lack of community access to affordable, effective diagnostics for COVID—or other high-risk diseases—results in an inability to detect disease and direct resources to break chains of transmission,” he said. 

Read more at www.ft.com

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