TIDMMDST
RNS Number : 9667D
Medicsight Plc
31 March 2011
Press release 31 March 2011
Medicsight PLC
("Medicsight" or "the Company")
Preliminary Results for the 12 months ended 31 December 2010
Medicsight PLC (AIM: MDST), an industry leader in the
development of Computer-Aided Detection (CAD) and image analysis
software to assist in the early detection of disease, is pleased to
announce its Preliminary Results for the 12 months ended 31
December 2010.
Financial and Operational 2010 Highlights
-- Revenues increased to GBP350,000 (2009: GBP115,000) including
increased CAD revenue
-- Balance sheet with cash reserves of GBP5.3m at 31 December
2010 (2009: GBP10.7m)
-- A review of business operations and subsequent cost reduction
plan implemented in 2009 has resulted in operating costs
reducing by 37% during 2010
-- Received State Food and Drug Administration approval in China
for the latest version of ColonCAD(TM) (version 4.0)
-- Launched the MedicCO(2) LON automated CO(2) insufflator in
Europe (where it is CE approved), signed a global
distribution agreement and commenced sales
-- Progressed regulatory approvals in Japan and the USA
-- Continued to develop distribution models and partner
relationships for ColonCAD(TM) in EU, China, Canada,
Australia and Brazil
Highlights post year end
-- Responded to a number of informal questions and a request for
additional statistical analysis on the submission data from
the US Food and Drug Administration
-- Gained European (CE) approval and launched ColonCAD 4.1 on 25
March 2011
-- Received a MedicCO(2) LON order which is due for delivery in
Q2
Allan Rowley, Chief Executive Officer of Medicsight PLC,
commented: "I am pleased to report an increase in revenue in 2010
following strong commercial progress. CAD software revenue
increased in the fourth quarter in particular. This year also saw
the launch of our MedicCO(2) LON CO(2) insufflation device. We
signed a global distribution agreement and European sales of
MedicCO(2) LON constituted 40% of total revenue. We are hopeful of
higher revenues of both MedicCO(2) LON and CAD in 2011 and have
already received a MedicCO(2) LON order for delivery in Q2.
"After working closely with the clinical, statistical and legal
advisors, on 2 June 2010 the Company sent a comprehensive response
to the second request for additional information we received in
January 2010 from the US Food and Drug Administration (FDA).
Medicsight recently responded to a number of further informal
questions and a request for additional statistical analysis on the
submission data. We are currently awaiting feedback from the FDA on
the status of the application.
"In Japan, the Ministry of Health, Labour and Welfare has
completed the submission review and quality audit phases of its
review. It is currently performing the reliability audit phase and
has requested some additional data from the Company in order to
complete its review. The Company is in the process of responding to
this request.
"Overall 2010 was a challenge as reduced headcount resulted in
additional responsibilities for all staff. We have however, been
successful in increasing revenue, launching a new product,
continuing to progress our research projects and have launched a
new version of the CAD software just a week ago. We continue to
believe that US and Japanese approvals will be forthcoming and
accordingly we look forward to launching in those territories."
- ENDS -
For further information:
Medicsight plc
Allan Rowley, CEO Tel: +44 (0)207 605 7950
www.medicsight.com
Daniel Stewart & Co
Noelle Greenaway / Oliver Rigby Tel: +44 (0) 207 776
6550
www.danielstewart.co.uk
Media enquiries:
Abchurch
www.abchurch-group.com
Julian Bosdet Tel: +44 (0) 207 398
7700
julian.bosdet@abchurch-group.com
Adam Michael Tel: +44 (0) 207 398
7708
adam.michael@abchurch-group.com
Simone Elviss Tel: +44 (0) 207 398
7728
simone.elviss@abchurch-group.com
Quincy Allan Tel: +44 (0) 207 398
7710
quincy.allan@abchurch-group.com
Notes to editors
Medicsight plc is a UK-headquartered, research driven, leading
developer of computer-aided detection (CAD) and image analysis
software for the medical imaging market. The CAD software
automatically highlights suspicious areas on computerised
tomography (CT) scans of the colon, helping radiologists to
identify, measure and analyse potential disease and early
indicators of disease. Medicsight's CAD software has been developed
using a large and population diverse database of verified patient
CT scan data. Medicsight's ColonCAD(TM) software products are
seamlessly integrated with the advanced 3D visualisation
workstations of several industry-leading imaging equipment
partners.
About Computer-Aided Detection
With increasingly sophisticated radiological imaging hardware
such as Multi-Detector CT scanners, radiologists are facing a
growing challenge in the amount of detailed patient image data that
they must review for each patient examination. Some CT scan
examinations generate as many as 2000 images per patient. Review of
this data by the radiologist is not only time-consuming but also
prone to error due to reader fatigue. CAD software can help the
reviewing radiologist by analysing the image data and automatically
highlighting suspicious regions of interest for closer inspection.
Without CAD software some potential abnormalities or areas of
disease may be overlooked. This can be critical for diagnosis and
the management of patient outcomes as early detection of disease
greatly increases the probability of successful treatment and a
positive therapeutic outcome. In addition to supporting individual
radiologists CAD also has the potential to help standardise CT
interpretation across both individuals and institutions thereby
supporting population based screening programmes.
About Medicsight's CAD software
Medicsight's ColonCAD(TM) software uses an advanced CAD
algorithm to analyse CT scans of the colon and automatically
highlight suspicious areas that may be indicators of disease. CAD
may highlight areas easily overlooked by the reviewing radiologist,
such as small lesions or regions that are hidden from view behind
folds in the colon.
ColonCAD can be seamlessly integrated with advanced 3D
visualisation platforms of industry-leading imaging equipment
partners. The integrated systems provide sophisticated image
viewing capabilities, including 3D reconstructed image data, with
the added advantage of demonstrating automatic CAD findings to
assist clinical end users in the detection and analysis of disease.
This allows clinical end users to perform either a 'second read',
where CAD findings are displayed to the user after completion of an
initial review of the CT scan data, or a 'concurrent read' where
CAD findings are displayed during the user's initial review of the
original CT scan images.
Since inception, Medicsight has developed close and lasting
relationships with some of the world's foremost clinicians in
product related areas. This provides the Company with a wealth of
clinical expertise and dedicated clinical research to support
ongoing product development. Medicsight also collaborates with a
number of leading academic institutions and clinical research
programmes worldwide to develop the Company's comprehensive
database of population diverse verified patient CT scan data, thus
allowing Medicsight's products to be validated to the highest
possible standards.
Chairman's Statement
Medicsight is an industry leader in the development of
Computer-Aided Detection ("CAD") and image analysis software to
assist radiologists in the early detection and diagnosis of
disease.
The Group's focus continues to be on developing CAD software
applications and related technologies and products that help
clinicians in the early detection of potential colonic polyps
(potentially pre-cancerous lesions on the wall of the colon) when
analysing medical images generated from Computerised Tomography
("CT") scanners.
In the year ended 31 December 2010 Medicsight:
-- continued to work with the regulatory authorities in Japan;
-- responded to the second additional information ("AI")
request regarding the ColonCAD(TM) application for 510(k)
clearance to the USA Food and Drug Administration ("FDA");
-- received SFDA approval in China for the latest version
of ColonCAD(TM) (version 4.0);
-- launched the MedicCO(2) LON automated CO(2) insufflator in
Europe (where it is CE approved), signed a global
distribution agreement with MEDRAD Inc. and commenced sales;
-- continued to improve the performance of the Medicsight
ColonCAD(TM) application;
-- continued research and development of the Medicsight product
range; and
-- continued business development with existing and potential
new partners.
In the year ended 31 December 2010 Medicsight recorded
GBP350,000 of revenue, and has cash reserves of GBP5,336,000 at 31
December 2010.
In the period post 31 December 2010, Medicsight:
-- prepared responses to a series of informal questions
including a request for additional statistical analysis on
the submission data requested by FDA. The Company completed
the analysis and responded to the FDA on 7 March 2011;
-- gained European (CE) approval and launched its ColonCAD
4.1 on 25 March 2011.
Product development
ColonCAD
Medicsight's core technology is the proprietary ColonCAD(TM)
algorithm that is integrated (using application programming
interface ("API") technology) into visualisation workstations for
radiologists to use when reviewing a patient's colon CT scan
data.
The CAD algorithm assists the radiologist as they search for
polyps in the CT scan image data. The radiologist uses the
visualisation software to review the patient's CT scan images on
the screen and search for polyps (potentially pre-cancerous lesions
on the wall of the colon). After a full review the radiologist then
activates the Medicsight ColonCAD(TM) software - which immediately
displays "CAD marks" on the images, drawing the radiologist's
attention to potential polyps and other regions of interest. The
radiologist then assesses each marked region in order to make the
final decision as to the presence or absence of a polyp.
Clinical studies have demonstrated that radiologists assisted by
Medicsight's ColonCAD(TM) technology have a significantly higher
sensitivity for the detection of patients with polyps in CT
colonography compared to unassisted reading (i.e. traditional
reading without the use of ColonCAD(TM)).
Medicsight launched ColonCAD(TM) version 4.0 in March 2009. This
software release significantly reduced the number of false-positive
CAD marks presented to a radiologist reviewing a patient data set.
Medicsight has further developed its ColonCAD(TM) technology and
post year end, in March 2011 released version 4.1. This release
significantly reduces processing time (savings of up to 50% in the
time taken to process image data), adds Windows 7 to its list of
supported Operating Systems, is 64-bit compatible and maintains the
high sensitivity and low false positive performance of Version 4.0.
This should cut processing times, provide benefits to workflow, and
ultimately enable clinicians to review more patients. Further
improvements in sensitivity and reduction of false-positive CAD
marks remain in development. We hope to be able to release these in
the second half of 2011.
Medicsight's ColonCAD(TM) has been developed and validated using
a large database of CT scans from hospitals around the world and
has been assessed in many clinical studies, the results of which
have been published in peer-reviewed publications and presented at
leadingradiology conferences.
MedicCO(2) LON
In addition to the computer aided detection software
applications, Medicsight has developed MedicCO(2) LON, an automated
CO(2) insufflation device.
Insufflation is required in preparation for and during a CT
Colonography (CTC) procedure in order to provide optimal distension
and allow a clinician to assess the colon confidently. Insufflation
can be provided with either room air or carbon dioxide gas (CO(2)
). Research has shown that CO(2) causes less discomfort to patients
when compared to room air. The Medicsight MedicCO(2) LON
insufflator is the next generation in automated CO(2) insufflators
developed in consultation with leading CT colonography centres
worldwide and is designed to administer CO(2) to the colon and
regulate colonic distension, and supports optimal colonic
distension whilst minimising patient discomfort.
Longer term projects
Some longer term colon related opportunities that we continue to
research include:
-- Prone and supine registration technology - clinicians
review the movement of findings between the two patient
positions to distinguish lesions from stool. Registration
brings the colon surfaces from the two positions into
correspondence - reducing clinical review time.
-- Optical endoscopy - Medicsight has a research subsidiary,
MedicEndo Limited working with leading London academic and
clinical centres, to research the use of CAD and other image
analysis technologies in the field of optical endoscopy, with
a view to these technologies combining information in real
time (i.e. as a clinician examines a patient) from two
sources of patient data.
-- Other R&D projects being assessed or in an early stage
include CAD improvements to increase sensitivity and
specificity, prep-less and reduced-prep CAD and flat lesion
detection.
Intellectual Property
Medicsight continues to develop its intellectual property
portfolio to protect the core technology in its CAD and other
products. During 2010, patents were granted in the UK and US
covering various aspects of Medicsight CAD algorithms (for both
Colon and Lung) as well as image processing methods related to the
identification of the boundary of lesions. Medicsight currently has
12 patents granted and 29 pending.
Regulatory approvals and submissions
US Food and Drug Administration clearance
In November 2008 Medicsight submitted the ColonCAD(TM) 510(k)
application to the Food and Drug Administration ("FDA") for
clearance in the USA. In December 2008 we received an Additional
Information ("AI") letter from the FDA and submitted our response
to the FDA's enquires in March 2009.
During the summer of 2009 we had a number of informal meetings
and discussions with the FDA as they performed their review of our
510(k) submission.
On 5 January 2010 we received our second Additional Information
("AI") letter from the FDA, in which the FDA requested further
technical details regarding the clinical trials and data analyses
undertaken in our original 510(k) submission. After working closely
with the clinical, statistical and legal advisors, the Company sent
a comprehensive response to the FDA on 2 June 2010.
Following this response the FDA asked a number of informal
questions and made a request for additional statistical analysis on
the submission data. The Company completed the analysis and
responded to the FDA on 7 March 2011. We are currently awaiting
feedback from the FDA on the status of the application.
Japanese Ministry of Health, Labour and Welfare
In November 2007 Medicsight submitted our MedicRead Colon
application to the Ministry of Health, Labour and Welfare ("MHLW")
regulatory authorities in Japan.
During 2009 and 2010 we attended a number of meetings with
ministry officials, demonstrated the product, answered specific
questions regarding the product application and formally responded
to questions from the MHLW. Following completion of the submission
review and quality audit phases, the authorities are now performing
the reliability audit phase of their review and have requested some
additional data from the Company in order to complete their review.
The Company is in the process of responding to this request.
The recent earthquake and tsunami in Japan have had no direct
impact on our employees, intellectual property or clinical data.
However we are unable at this time to assess the impact or possible
risk of delay, these recent events may have on the review response
time at the Ministry of Health, Labour and welfare in Tokyo.
Other regulatory territories
In November 2009, we submitted MedicRead 3.0 (our visualisation
workstation which includes version 4.0 of the Medicsight ColonCAD
API) to the Chinese State Food and Drug Administration ("SFDA") for
approval. On 13th October 2010 this was successfully approved.
On 25 March 2011, version 4.1 of the Medicsight ColonCAD API
gained European (CE) approval and was released by the Company to
its partners.
MedicCO(2) LON
On 26 February 2010 our MedicCO(2) LON automated CO(2)
insufflation device gained European (CE) approval.
In March 2011 we submitted MedicCO(2) LON to the Therapeutic
Goods Administration ("TGA") in Australia for approval and we are
currently awaiting feedback.
In August 2010, in partnership with our distribution partner
MEDRAD Inc., we submitted MedicCO(2) LON to the Ministry of Health,
Labour and Welfare ("MHLW") regulatory authorities in Japan for
approval. We are currently awaiting feedback.
We are currently preparing a submission to the SFDA for approval
to market the product in China.
Clinical Activity
Medicsight's Clinical Development team continued their work
supported by a global network of key opinion leaders.
Clinical presentations of Medicsight's CAD research were made at
the 20th Annual Meeting of the European Society of Gastrointestinal
and Abdominal Radiology "ESGAR" (Dresden, Germany, June 2010) and
the annual Radiological Society of North America "RSNA" conference
(Chicago, USA, December 2010).
In addition, Medicsight supported the bi-annual ESGAR CTC
training workshops held in Amsterdam (Netherlands) and Cascais
(Portugal) during 2010. These workshops train radiologists to
interpret CTC images using the latest visualisation and CAD
technology and are fundamental to the increasing acceptance and
implementation of CT colonography and CAD as a routine imaging
examination for investigation of the colon.
Commercial progress
Medicsight's primary route to market is via partnerships with
global advance visualisation companies, PACS suppliers and other
OEM's.
Medicsight currently has partnership agreements Vital Images
Inc., TeraRecon Inc., Viatronix Inc. and Toshiba Medical
Visualization Systems (previously Barco NV), Infinitt, Ziosoft
Inc., Intrasense SAS and Alma IT Systems.
We continue to work closely with our existing partners in order
to increase market awareness and drive additional demand for our
CAD software in the markets where the Company already has
regulatory approvals. In addition we are developing and building
relationships with new partners.
MedicCO(2) LON was launched in Europe in March 2010 at the
European Congress of Radiology held in Vienna, and has subsequently
generated sales. We work closely with MEDRAD, our distribution
partner, and look forward to additional sales in Europe and, once
the product receives regulatory approval, in other territories.
Financial review
Whilst still limited, revenues have grown to GBP350,000 in 2010
compared to GBP115,000 in 2009. Revenue from ColonCAD was
GBP210,000 (2009: GBP115,000) with the remainder of GBP140,000
(2009: nil) from MedicCO(2) LON sales. Medicsight ended 2010 with
net assets of GBP6,125,000, including GBP5,336,000 of cash and
short-term deposits. Post year end we continue to hold our surplus
cash on short-term deposit in Sterling.
In 2009 the Board completed a review of business operations and
resources and initiated a cost restructuring program to drive cash
flow savings without jeopardising the Company's longer term plans.
This resulted in a reduction in headcount and the disposal of a
number of dormant and non-core companies. As a result of these
actions, operating expenses have fallen in 2010 to GBP5,053,000
compared to GBP7,978,000 in 2009. In 2010 we had an average of 28
employees compared to 46 for 2009.
During the year, we entered into a short-term loan agreement of
USD $1,100,000 (GBP711,000) with Dunamis Capital DIFC, a United
Arab Emirates (UAE) registered company regulated by the Dubai
Financial Services Authority (DFSA). Dunamis repaid the principal
of USD $1,100,000 and interest of USD $48,000 (GBP31,000) on 6
February 2011 and 10 February 2011 respectively. Dunamis Capital is
a related party.
Corporate
During the period of this report we have restructured the
composition of the Board. Both David Sumner and Tim Paterson-Brown
have acted as Chairman and I would like to take this opportunity to
thank them for their service. On 29 March 2011 Dr John Costello and
Troy Robinson stepped down from the Board of the Company. Robert
Ladd and Richard Taney, both Directors of MGT Capital Investments
Inc, have joined the Board as Non-Executive Directors. I will
remain in the role of Non-Executive Chairman until the search for a
new Non-Executive Chairman is complete at which stage I will
continue on the board as Senior Independent Non-Executive Director.
The Board would like to extend its thanks to John Costello for the
clinical guidance and expertise that he has provided to the Company
over the past years. I am happy to say that the Board will continue
to be supported by Troy Robinson as Chief Financial Officer.
Outlook
Whilst we remain confident of achieving regulatory approvals in
the USA and Japan, timing remains uncertain and approvals cannot be
guaranteed. Whilst this is frustrating for shareholders and the
Medicsight team alike we look forward to achieving further
commercial progress in 2011 with increased sales of ColonCAD(TM)
and MedicCO(2) LON.
As your Chairman and on behalf of the Board I would like to
thank you for your continuing support.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2010
2010 2009
GBP000 GBP000
(unaudited)
Revenue 350 115
Cost of sales (75) -
_____________ _____________
Gross profit 275 115
Sales and marketing expense (907) (1,830)
Research and development expense (985) (1,255)
Administration expense (2,942) (4,324)
Share-based expense (219) (569)
_____________ _____________
Operating loss (4,778) (7,863)
Finance revenue 59 245
Finance expense (18) -
_____________ _____________
Loss before taxation (4,737) (7,618)
Income tax benefit 217 -
_____________ _____________
Total comprehensive income attributable
to owners of the parent (4,520) (7,618)
_____________ _____________
Loss per share (basic and diluted) (3p) (5p)
_____________ _____________
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2010
2010 2009
GBP000 GBP000
(unaudited)
ASSETS
Current assets
Cash and cash equivalents 5,336 10,708
Trade and other receivables 369 354
Loan receivable - related
party 734 -
_____________ _____________
6,439 11,062
Non-current assets
Property plant and equipment 81 58
_____________ _____________
Total assets 6,520 11,120
_____________ _____________
LIABILITIES
Current liabilities
Trade and other payables 395 694
_____________ _____________
Total liabilities 395 694
_____________ _____________
Net assets 6,125 10,426
_____________ _____________
EQUITY ATTRIBUTABLE TO OWNERS
OF THE PARENT
Issued share capital 7,776 7,776
Share premium 57,306 57,306
Share-based expense reserve 3,277 3,058
Retained earnings (62,234) (57,714)
______________ ______________
Total equity 6,125 10,426
______________ ______________
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2010
2010 2009
GBP000 GBP000
(unaudited)
Cash flows from operating activities
Cash used in operations (4,611) (7,850)
______________ ______________
Net cash used in operating activities (4,611) (7,850)
______________ ______________
Cash flows from investing activities
Loan receivable - related party (734) -
Purchase of equipment (57) (11)
Interest received 37 245
______________ ______________
Net cash from investing activities (754) 234
______________ ______________
Net decrease in cash and
cash equivalents (5,365) (7,616)
Cash and cash equivalents at
1 January 10,708 18,387
Effects of exchange rate changes (7) (63)
______________ ______________
Cash and cash equivalents at
31 December 5,336 10,708
______________ ______________
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2010
Issued Share based
Share expense Retained
(unaudited) Capital Share Premium reserve earnings Total Equity
GBP000 GBP000 GBP000 GBP000 GBP000
At 1 January
2009 7,776 57,306 2,489 (50,096) 17,475
Loss for the
year - - - (7,618) (7,618)
_______ ________ _______ __________ _________
Total
comprehensive
income - - - (7,618) (7,618)
Transaction
with owners -
equity
settled
share-based
expense - - 569 - 569
_______ ________ _______ __________ _________
At 31 December
2009 7,776 57,306 3,058 (57,714) 10,426
_______ ________ _______ __________ _________
At 1 January
2010 7,776 57,306 3,058 (57,714) 10,426
Loss for the
year - - - (4,520) (4,520)
_______ ________ _______ __________ _________
Total
comprehensive
income - - - (4,520) (4,520)
Transaction
with owners -
equity
settled
share-based
expense - - 219 - 219
_______ ________ _______ __________ _________
At 31 December
2010 7,776 57,306 3,277 (62,234) 6,125
_______ ________ _______ __________ _________
NOTES TO PRELIMINARY RESULTS
The unaudited preliminary announcement has been prepared under
the historical cost convention on a going concern basis and in
accordance with applicable International Financial Reporting
Standards ("IFRS") and IFRIC interpretations as adopted by the
EU.
The preliminary announcement has been prepared on the basis of
the same accounting policies as published in the audited financial
statements of the Company for the year ended 31 December 2009.
The financial information in this preliminary announcement does
not constitute statutory accounts within the meaning of section 435
of the Companies Act 2006. Statutory accounts for the year ended 31
December 2010 have not yet been delivered to the Registrar of
Companies and no audit report has yet been given on the statutory
financial statements. Statutory accounts for the year ended 31
December 2009 have been delivered to the Registrar of Companies.
The audit report on these statutory accounts was unqualified and
did not contain a statement either under section 498(2) or 498(3)
of the Companies Act 2006.
Loss per share and diluted loss per share
Loss per share is calculated by dividing the loss attributable
to ordinary shareholders for each year amounting to GBP4,520,000
(2009: GBP7,618,000) for the year ended 31 December 2010 by
155,525,000 (2009: 155,525,000), being the weighted average number
of ordinary shares in issue during each year.
For the purposes of dilution, share options are
non-dilutive.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SDEFWSFFSEDD
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