A good diagnosis makes for cheap treatment

In many African hospitals, diagnoses are made simply by looking at the patients. It is often too expensive to carry out tests, but Danish company Virogates plans to change this.

Over 17 million people die every year from infectious diseases, most typically sepsis, tuberculosis and HIV/AIDS. Almost all of these deaths occur in developing countries. The problem is, however, also widespread in many western countries. For example, around 200,000 people in the US die every year from sepsis. Sepsis occurs when infection spreads around the body.

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In many developing countries, one of the greatest challenges faced by hospitals is to work out which patients to treat and which to send home. This decision is often made simply by looking at the patient, which seldom reveals the presence of diseases such HIV/AIDS and tuberculosis.

There are tests for the majority of infectious diseases, but they are also relatively expensive. Virogates' product Suparnostic is a test kit which measures the level of the suPAR, a protein all people have in their blood. SuPAR is an indicator of a patient's general level of health.

Small profit in developing countries
The mission to contribute to the eradication of HIV/AIDS in developing countries was the driving force behind the founders of Virogates. Virogates hopes that a high volume of sales in developing countries will make up for the very low margins the company has to operate with. Conversely, Virogates will be able to achieve much higher margins in developed countries.

One Suparnostic test costs EUR 3-4. This price applies to sponsored medicine destined for Africa, but the test kit costs twice as much in the western world. It is still far cheaper than the current HIV tests, for example, which cost approx. EUR 60. All in all, Virogates estimates that hospitals stand to save 25 per cent on the total treatment of an HIV/AIDS patient by using Suparnostic.

Awaiting the first real customer
Last year, Virogates sold 180 test kits, which are being used by hospitals on a trial basis. The company is currently awaiting their feedback. The target for 2009 is to get the first real customer. Virogates reckons that developing countries will then account for a quarter of all sales within five years.

To date, the company has attracted venture capital to the tune of EUR 8 million from Biovision A/S, Missionpharma A/S and IFU (the Industrialisation Fund for Developing Countries) and a number of private investors. Virogates plans to complete a final funding round at the end of 2009/early 2010 and, if all goes to plan, will achieve break-even in 2011.