Imricor Medical Systems (IMR: $0.275) achieved consumable revenue of just US$115,000 for the quarter, down 15% on the previous corresponding period. However, it has increased the number of active sites by three to nine sites.
The company is pioneering the use of MRI-guided cardiac ablation therapy, rather than the use of x-ray imaging, which provides real-time functional data without radiation. It has been in development for 14 years.
One of the main reasons consumable revenue was down for the quarter was because of the competition for MRI machine use in imaging centres. The key learning is that the company needs to continue to focus on customers having dedicated iCMR (interventional cardiac MRI) labs.
Clinicians need time to develop the operating skills to use the new imaging procedure for ablations according to the company without having to compete for machine time for other procedures.
A major driver for the company will be expanding into more difficult ablation procedures, specifically ventricular tachycardia (VT), where better imaging will improve treatment outcomes and facilitate easier procedures. A clinical study in VT is due to start at the end of this year or early next year.
CEO Steve Wedan is confident of new sites coming online in the current quarter. Two dedicated iCMR labs are under construction, a tender has already been won for an additional site, and another group is in the budgeting stage for construction of its iCMR lab.
Other developments in the quarter included the completion of development of the 3D mapping system for use with Siemens machines, which allows the company to take back full control of the imaging process according to Wedan. Future mapping systems will be developed for use with also GE and Philips MRI systems.
Imricor had a net cash outflow of US$4.9 million from operating and investment activities. The company expects to seek alternative funding, outside of equity placements, this quarter. In the September quarter the company raised $2.92 million at a 27% premium to the share price at $0.38 per share through a private placement. Imricor finished the quarter with US$6.9 million in cash.
Imricor Medical Systems is capitalised at $42 million.
Bioshares recommendation: Speculative Hold Class B
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