Neogen Corporation NEOG announced the receipt of approval from the AOAC Research Institute for its Soleris for Enterobacteriaceae (EBAC). The test has been designed for the prevention of bacterial contamination of food, pet food, nutraceutical, pharmaceutical and cosmetic products.
Per Neogen, the Soleris test, which provides rapid and accurate results, is poised to further improve the company’s profitability by strengthening its customer base. The Soleris is one of the company’s tests for spoilage microorganisms, which is part of the Food Safety segment.
Notably, the Soleris test was developed by Centrus International, which Neogen acquired in 2006.
With the approval, Neogen aims to strengthen its Food Safety segment globally.
Solaris for EBAC at a Glance
With the AOAC's Performance Tested Method Certification, the Soleris for EBAC test received independent validation of its ability to precisely detect EBAC in a wide variety of sample types.
Significance of the Approval
The Soleris test is less time consuming as it is an automated and rapid optical system for the detection of microbial contamination. This marks an improvement over the traditional methods.
Additionally, Soleris for EBAC was certified by MicroVal — an international certification organization for the validation and approval of alternative (confirmation) methods for the microbiological analysis of food, beverages and water. The certification proves that a proprietary method is on par with the reference method as far as performance is concerned.
Per a report by Grand View Research, the global food safety testing market size was approximated at $18 billion in 2018, witnessing a CAGR of 7.7% between 2019 and 2025. Increasing incidents of food contamination due to rising demand for packaged and processed food is likely to drive the market.
Given the rising potential of the market, the test validation has been well timed.
Recent Developments in Neogen’s Food Safety Segment
In December, the company announced the launch of the Reveal Q+ MAX test to check for ergot alkaloids infection in rye and wheat. The test, which is the first one for ergot alkaloids in the simple rapid lateral flow format, is compatible to be used with Neogen's Raptor testing platform.
In November, the AOAC Research Institute approved the company’s Reveal 3-D for Peanut test to help prevent peanut residues from contaminating foods intended to be peanut-free.
Neogen, in October, launched K-Gold Plus, a p-nitrophenyl phosphate (PNPP) substrate, combining the ease of use of its previous PNPP substrate with improved signal-to-background performance.
The AOAC also validated NeoSeek for STEC, a testing platform that determines the genetic composition of bacteria in a food sample. The test detects and identifies seven Shiga toxin-producing strains of E. coli (STEC), which are known to cause severe illness in humans.
Shares of Neogen have gained 27.9% in the past year compared with the industry’s 20.8% growth.
Zacks Rank & Key Picks
Currently, Neogen carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are Haemonetics Corporation HAE, National Vision Holdings, Inc EYE and ResMed Inc RMD.
Haemonetics currently has a Zacks Rank #2 (Buy) and a projected long-term earnings growth rate of 13.5%.
National Vision’s long-term earnings growth rate is estimated at 17.8%. The company currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ResMed’s long-term earnings growth rate is estimated at 14%. It currently flaunts a Zacks Rank #1.
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