Local lung-imaging medical technology company 4D Medical has had its lung airflow imaging device approved by the Therapeutic Goods Administration six months ahead of schedule.
The news catapulted the company’s share price up almost 12 per cent in morning trade on Wednesday, with the stock trading at $1.70 at 12.30pm.
The announcement came less than two months after the company listed on the ASX with an issue price of 73¢ per share.
4D Medical chief executive Dr Andreas Fouras told The Australian Financial Review the approval of its XV Lung Ventilation Analysis Software was not expected to come through until 2021.
“We’re something like six months ahead of when we’d originally planned to get it. It’s one of the reasons we’re so excited because this is an acceleration,” he said.
“Australia and the US are the two places where we have a direct sales force … so it’s a great commercial outcome.
“Emotionally, as an Aussie it also feels like we’re bringing the tech home by getting clearance here. The US FDA approval was very important commercially, it was a big milestone and the toughest to get, but this one tastes a little better.”
The company’s lung-imaging device leverages Dr Fouras’ background in aeronautical engineering as a Monash University professor to determine if there are parts of the lung receiving less air.
Its technology converts sequences of X-ray images into four-dimensional quantitative data, allowing physicians to better diagnose and treat patients with respiratory diseases such as asthma, chronic obstructive pulmonary disease and lung cancer.
Current imaging techniques give an overall view of how much air the lungs are taking in, but do not reveal whether certain sections of someone’s lungs are receiving less air.
The business received wide-ranging FDA approval for its device in May, with the device approved for all indications.
Bringing it home
Dr Fouras said the business would be able to beef-up its local sales team quickly to start selling its product into Australian hospitals.
“The good news is we’re well connected here. It’s our home territory and we feel good about our ability to attract and bring talent onto the team ahead of schedule,” he said.
“We’re committing to interacting and working with hospitals really quickly and having commercial sales in the next calendar year. There’s a lot of opportunity for that to go well.
“We’re well known in Australia and have great relationships in the market. It may not be as big as the US, but in a lot of ways it’s easier to navigate. In short, I’m really excited about the pipeline and how long it takes to get going precisely we’ll have to wait and see.”
The TGA approval comes on the back of 15 years of development work in Australia, with Dr Fouras selling his family home and investing all of his savings into the business.
The company was seeded at Monash University, where it was funded via National Health and Medical Research Council (NHMRC) grants, before being spun out and raising capital from local high-net-worth investors.
Investors in its recent float included Perennial Value Management, Ryder Capital, Pendal Group, EFM Asset Management, OC Funds Management and Quest Asset Partners.
4D Medical is already working on its next products, with its second set to be one that monitors blood flow in the lungs. In its prospectus it had flagged development completing on this product in mid-2021 and targeting FDA approval in 2023.
Dr Fouras said development on this was ahead of schedule and if it were not for COVID-19, the company would have been in a position to start clinical trials this year.
“The R&D is looking very strong,” he said. “I’d be hesitant to talk about when it could be cleared [by regulators], but in testing the product is looking really fantastic and every sign is that in the worst-case scenario, we’ll be on time [with development], but it’s likely we’ll be well ahead of the schedule in the prospectus.”