A month after Elron Electronic Industries Ltd. (TASE: ELRN) reported a trial by partly-owned subsidiary Pocared did not meet expectations, the company revealed the reasons why and opened the door for renewed optimism for Pocared’s product.
Elron holds 58% of Pocared, which developed a real-time, automated system for microbiology testing - intended to replace the existing diagnostic methods in laboratories (bacteria culturing) and significantly shortening the diagnostic period.
Pocared held a trial to examine the efficiency of the first implementation of its system - to test urinary tract infections - but the results did not live up to expectations. When Elron reported the lack of progress last month, its share price sunk 10%.
On Wednesday, Elron said further examination of the Pocared trial results revealed a fault in some of the calibration components in the system, which caused the erroneous results. Elron said, “The source of the mishap was identified and was tested by running the raw data that was collected in the trial in a system with the correct calibration; the results from this simulation were in line with Pocared’s expectations.
“Pocared took measures to prevent the recurrence of the fault and is looking into running a new trial to prove the efficiency and performance of the system for its US Food and Drug Administration application - similar to the aim of the present trial which was halted.”
The new trial will be held in 2017. For Elron, the delay in the development of the Pocared product and its regulatory hurdles is a significant improvement over a failure of the trial - as was suspected following the previous results.
Elron, run by Ari Bronshtein, has a market cap of NIS 502 million.
Published by Globes [online], Israel business news - www.globes-online.com - on March 27, 2016
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