The Volpara Health Technologies Ltd (ASX: VHT) share price is in focus after the ASX healthcare share announced a new contract.
Volpara provides software relating to breast screening, analysis and practice management.
Breastscreen Victoria win
Volpara announced that it had won a five-year contract for A$1.4 million (NZ$1.53 million) in total contract value (TCV) with BreastScreen Victoria.
This contract includes Volpara Analytics, which the ASX share described as artificial intelligence (AI) quality software that “assesses every mammogram image for appropriate positioning, compression and radiation dose.”
Volpara believes this will lead to a higher-quality screening programme and improved personalised care for women.
This contract expands Volpara’s presence in Australia – it already has contracts with BreastScreen Queensland, BreastScreen South Australia , I-MED and Sonic Healthcare Ltd (ASX: SHL).
BreastScreen Victoria operates in more than 50 locations across the state and diagnoses 37% of all breast cancers in Victoria. This win is a positive for the Volpara share price, in my opinion.
Installation of Volpara’s software at BreastScreen Victoria is expected to be completed within three to six months. It includes annual payments and is anticipated to contribute to revenue growth in FY24. The ASX share noted that the customer has the right to terminate the contract during the initial three-month period if “certain product metrics are not met”. Hopefully that doesn’t happen.
Management comments
The Volpara CEO and Managing Director Teri Thomas said:
We are thrilled to have BreastScreen Victoria join the ranks of Australian screening programmes and other healthcare providers already using Volpara’s AI-powered software.
Australia boasts one of the world’s highest breast cancer survival rates after five years at 91%. Both private and public screening programmes, like BreastScreen Victoria, deserves praise for their commitment to improving quality and detecting cancer earlier through technology investments.
Final thoughts on the Volpara share price
While the ASX healthcare share has risen less than 1% in response to this, it’s another positive on a list of positives.
It has done very well in the US, so it’s good to see that the company is winning more contracts outside of that market.
The more market share it can capture, the better chance it has of increasing its average revenue per user (ARPU). I believe it’s one of the most promising ASX growth shares around.
