Biotech firm soars after it develops test for coronavirus

SHARES in a London-listed biotech firm soared yesterday after it applied for emergency approval from US regulators for a coronavirus test following “unprecedented” demand.

Novacyt Group said it has received orders for 33,000 of its diagnostic tests and requests for quotations for another 32,000 from more than 30 countries since it launched the product last week.

Shares soared by a quarter, or 10.5p, to 51p.

More than 600 people have died in mainland China since the coronavirus was discovered in December, infecting more than 31,000. Novacyt said emergency approval would allow its labs in the US to use the test for clinical diagnosis on a temporary basis.

Graham Mullis, chief executive, said: “As one of the first companies to develop and launch a test to detect the 2019 strain of ncov, we have received unprecedented interest in our test and anticipate demand continuing to grow.”

The outbreak prompted Burberry to abandon sales forecasts for the year because of plunging consumer demand in China. The luxury retailer has closed 24 of its 64 stores in mainland China with the remainder operating on reduced opening hours.

It is a major blow to Burberry, which makes about two fifths of its sales from Chinese customers and is still reeling from political protests in Hong Kong that halved sales in the region.

Marco Gobbetti, chief executive, said: “The outbreak of the coronavirus in mainland China is having a material negative effect on luxury demand. While we cannot currently predict how long this situation will last, we remain confident in our strategy.

“In the meantime, we are taking mitigating actions and every precaution to help ensure the safety and well-being of our employees.”

Shares fell almost 5pc following the announcement but closed down just 2p at £20.15.

The coronavirus is expected to hit the luxury sector. Chinese consumers account for more than a third of the €281bn (£238bn) luxury sector globally, according to consultancy Bain.

Earlier this week jeweller Pandora said business in China had come to a “standstill”, while Wynn Resorts said it was losing about $2.5m (£1.9m) a day while its Macau casino remains closed.

Meanwhile, demand for face masks globally has prompted iphone maker Foxconn to shift part of its production to making masks. The manufacturer is working to make 2m masks a day before the end of the year.