IT group Instem secures contract extension

26th Mar 2014 07:54

AIM-listed IT company Instem has won a contract extension with the US National Institute of Health for its provantis pre-clinical software suite.The group, which operates in the health department, also plans to add two further operational sites and 100 further Provantis users.Provantis is a Windows-based system for organisations and universities engaged in non-clinical evaluation studies.The extension of the contract is worth $1.3m, and the possibility remains to expand the agreement up to a further eight years, which will allow the group to see a total of $6.5m-$7.6m for the duration of all 10 years.The contract includes the ability to license six additional sites on the same terms which could result in to an increase in profits.Phil Reason, Chief Executive Officer, said: "The first 12 months under this important US government contract have gone very well and the renewal for the first option year marks an important contract milestone. "This long term contract provides funding for the development of the Provantis suite in areas specific to the National Toxicology Program, adding further depth to our market leading study and positioning Instem well for anticipated contract extensions."As of 08:50, the share price had risen 12.5% to 180p.WS