Cepheid Inc said it signed deals with the Bill & Melinda Gates Foundation and three other aid organizations to make its tuberculosis diagnostic kit available at reduced prices in developing countries burdened with the disease.
Shares of Synnyvale, California-based Cepheid were up 7 percent at $36.61 after the bell. They closed at $34.16 on Monday on the Nasdaq.
Other than the Gates Foundation, the company entered into deals with the United States President's Emergency Plan for AIDS Relief (PEPFAR), the United States Agency for International Development (USAID) and UNITAID, a group that facilitates the purchase of AIDS, malaria and tuberculosis drugs.
Cepheid said the four organizations will fund the purchase of the Xpert MTB/RIF test in 145 countries that face the most tuberculosis cases. The agreements will see the test sold for $9.98, down from its current price of $16.86 per test.
Cepheid said the Bill & Melinda Gates Foundation will make an initial payment of $3.5 million to make the test immediately available at the lower price.
The company expects the remaining sales to be recognized over the next 18 months.[Photo courtesy of Wikimedia Commons]