Scope Fluidics publishes Development Strategy


Scope Fluidics S.A. (WSE:SCP), the biotechnology firm featured on the sWIG80 index that made history in 2022 with the largest transaction in the Polish life science sector, has unveiled a Development Strategy, which is designed to sustain the company’s growth by serving as a platform that consistently generates and markets innovative projects through a repeatable business model. Scope Fluidics has outlined the following strategic objectives:

  • Achieving a portfolio of at least five new projects by the end of 2025, with a minimum of two structured as special purpose vehicles.
  • Completing a minimum of two strategic transactions by the end of 2028.
  • Aiming to execute at least one strategic transaction per year on average between 2029 and 2033.
  • To achieve its strategic objectives, the company has identified key development vectors, which include the advancement and successful sale of BacterOMIC technology, as well as the establishment of an internal organization called “Scope Discovery” that will be responsible for systematically identifying and developing new projects.
  • Based on the Management Board’s projections, Scope Fluidics is expected to hold approximately PLN 95 million in cash following the 2022 dividend. This amount is anticipated to adequately support the growth of the Scope Fluidics Group over a three-year period. Concurrently, the company intends to explore options to enhance access to financing, prioritizing non-dilutive sources.

Professor Piotr Garstecki, co-founder, major shareholder, and President of the Scope Fluidics Management Board, remarked: – At the inception of Scope Fluidics, the vision was to establish a platform for ambitious, cutting-edge technology projects. For years, we have been diligently working towards realizing this objective. The sale of PCR|ONE has validated Scope Fluidics’ business model and enables us to outline a path forward to actualize the company’s growth vision. We are expediting the development of BacterOMIC, drawing upon the insights gained from our experiences. We are introducing a ‘Scope Discovery’ organization within Scope Fluidics, assigned to systematically identify and develop new projects. Our goal is to streamline the process from selecting a new project to executing a strategic transaction. In the coming years, we plan to concurrently develop multiple projects.

Marcin Izydorzak, co-founder, major shareholder, and Executive Vice-President of the Scope Fluidics Management Board, stated: – We are actively bolstering our teams, both within Scope Fluidics—including the Scope Discovery division—and the subsidiary responsible for developing the BacterOMIC system. The successful sale of the PCR|ONE technology bolsters our efforts to attract new talent. We have already onboarded, and will continue to bring in, individuals with exceptional international experience across various crucial areas in the near future. Our teams have always been a driving force behind the company’s success. Now, as we further fortify our teams, this enhancement will be reflected in the quality of our projects—a factor that directly impacts the commercial potential of our technologies.

The BacterOMIC system addresses the escalating global medical challenge posed by antibiotic-resistant bacteria. The World Health Organization estimates that by 2050, the annual death toll from infections caused by drug-resistant microorganisms will surge from 700,000 to 10 million per year, making them one of the leading causes of death worldwide.

BacterOMIC’s technology aims to expedite and enhance patient treatment by determining the most effective targeted therapies for each individual. In as little as 16 hours, BacterOMIC’s technology can accurately evaluate the susceptibility of bacteria to all clinically significant antibiotics, supplying the clinician with comprehensive information on the specific pathogen in question. The test’s unparalleled informative capacity in the market contributes to the system’s several key competitive advantages.

Since 2021, BacterOMIC has been CE-IVD certified, allowing for its marketing within the European Union. The development of the BacterOMIC system commenced in 2016, and a special purpose vehicle, Bacteromic sp. z o.o., was subsequently established in 2017. In 2019, the BacterOMIC project achieved semi-finalist status in the esteemed American Association for Clinical Chemistry Disruptive Technology Award Competition. As of the end of 2022, the financial investment for the development of the BacterOMIC system totaled approximately PLN 25 million.

Scope Fluidics’ ultimate objective is to maximize the value of the BacterOMIC technology; therefore, the base case scenario envisions a strategic transaction when Bacteromic sp. z o.o. starts generating revenue.

Szymon Ruta, Financial Director and Vice-President of the Management Board, said: – We have demonstrated our ability to efficiently allocate resources for the development of our innovations. The financial expenditure on PCR|ONE, up until its sale for an upfront payment of US$100 million, was approximately US$10 million. Today, drawing on our experience, we are expediting the development of BacterOMIC to optimize its value in any potential transaction. With the base case scenario in mind, our goal is to execute the transaction once the company begins generating revenue. However, this does not mean that we are remaining idle in the context of an M&A. We are actively cultivating interest in the system among potential buyers and remain open to offers that may arise.

“Scope Discovery” is an internal organization, designed as an interdisciplinary team engaged in process-driven efforts aimed at the iterative generation of product concepts. It will be responsible for efficiently evaluating and refining ideas and concepts, converting them into profiles for distinct products, analyzing customer value, estimating the size and attributes of target markets, gathering evidence supporting the feasibility of functional technological solutions, and assessing the likelihood of success. The culmination of these processes will involve establishing new special purpose vehicles (SPVs) for the most promising projects.

The Scope Discovery process will be highly selective, structured in two stages—Product Concept and Proof-of-Concept—with projects subject to rejection following either the first or second stage. The entire Scope Discovery process, encompassing both stages, is expected to take no more than approximately 12 months.

Professor Piotr Garstecki stated: – Scope Discovery serves as a vital instrument for realizing our vision. We have firm faith in the efficiency of our processes, the creativity of our team members and researchers in Poland, as well as the potential to develop groundbreaking products. We plan to analyze a substantial number of projects, and only those that promise above-average value, ensuring high returns on investment, will be executed within the framework of special purpose vehicles.

Szymon Ruta commented: – After the dividend for 2022, we anticipate having approximately PLN 95 million in cash reserves. These funds are expected to be sufficient to support the Group’s expansion over the course of a three-year period. At the same time, we hold the capacity to acquire additional funding. In doing so, our preference will be towards non-dilutive sources such as grants or debt capital. Additionally, we may potentially rely on proceeds from milestones associated with the PCR|ONE sale transaction or the sale of other technologies.

Scope Fluidics specializes in creating and advancing technologies and products within the life science industry. The Company’s operating model involves the development and scientific as well as business validation of groundbreaking technologies. Subsequently, special purpose vehicles are established to further develop these projects, aiming for strategic transactions with industry or financial investors.

Within the Group, Scope Fluidics possesses in-house expertise in finance, administration, and legal matters, which are utilized by the Group’s companies. Scope Fluidics acts as a funding source by transferring the necessary funds to the SPVs to cover ongoing research and development expenses, as well as by providing the so-called “own contribution” for EU funding.