What happened to Neurotech International’s share price?
Neurotech International Limited (ASX:NTI) shares are up 64% at the time of writing, to 2.3 cents.
Why did Neurotech International’s shares push higher?
Neurotech International ― a medical device company focused on screening and treating symptoms associated with autism ― announced the launch of a pilot version of Mente Clinic.
Mente Clinic is a virtual health centre where clinicians can interact with their autistic patients and remotely monitor their progress. Neurotech’s goal is to increase engagement and improve relaxation in autistic children with elevated Delta band brain activity.
The company launched its ‘Early Adopter Program’ in geographic regions where Mente is registered as a medical device, such as the UK and US. Early adopters will receive substantial discounts on Mente’s Starter Pack and subscription model, with no contractual obligations. As a result, Neurotech will encourage its clients to provide regulator feedback on the usability and volume of registered users.
The share price skyrocketed on the news.
What’s next for Neurotech International?
Shareholders celebrated the long-expected pilot launch:
That said, despite the share price rocketing higher today, Neurotech International has been in a downtrend for the past year. There’s major overhead resistance around the 4-cent level, with technical support around 1 cent. A weekly closing above or below these targets will likely trigger fresh highs or lows in the short term. In this case, assuming the virtual clinic turns into a highly profitable business, the direction will probably be positive.
But it’s early days…
CEO and Managing Director Peter Griffiths told the market today (our emphasis added):
Following the launch of the subscription model in March, we are very excited about Mente Clinic and our Early Adopters Program. We want our Early Adopters to play a leading role as we work to expand the reach of Mente. Through their participation in this program, they can benefit from introductory pricing and help us by providing ongoing feedback on Mente and its benefits.
Indeed, with the focus on enhancing usability and engagement to attract clients, Mente Clinic remains an unproven medical product. No one knows whether it will become profitable. That’s possibly why the share price and market capitalisation remains cheap. Still, you never know what could happen. Mente has been validated with a double-blind independent clinical trial in the US and has also received a CE medical certification in the UK.
The bottom line: Neurotech International offers an exciting medical product, which could make shareholders rich. But it’s worth noting that most SaaS business models fail on the ASX. Neurotech International is also nearing the point where it will require a cash injection from the market. In this case, while we don’t own any shares yet, we will stick the company on our watch list and might buy some shares if the business model starts delivering.
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The Trading For Millions Team