Transcription of Finance News Network Interview with Volpara Health Technologies Limited (ASX:VHT) CEO and Executive Director, Dr Ralph Highnam
Carolyn Herbert: Hello I’m Carolyn Herbert from the Finance News Network and joining me from Volpara Health Technologies Limited (ASX:VHT) is CEO and Executive Director, Dr Ralph Highnam. Ralph, welcome to FNN.
Dr Ralph Highnam: Thanks Carolyn, it’s a real pleasure to be here.
Carolyn Herbert: Congratulations on the listing. Can you start by giving us an introduction to the company?
Dr Ralph Highnam: Breast cancer is a major issue around the world Carolyn. 1 in 8 women in the western world will develop it and 75 million women in a year globally, actually get screened. Unfortunately that screening, although it’s proven to save lives, it’s not optimal. In 2009, four of the world’s leading breast imaging scientists, myself, Professor Sir Mike Brady in Oxford, Professor Martin Yaffe in Toronto and Professor Nico Karssemeijer of Nijmegen, came together and said, we know a way of improving breast cancer screening and that’s to combine our knowledge of measurement of breast composition, to actually start to relay to women, reliable information about their breast cancer risk. So they can make informed decisions about additional imaging for breast cancer detection and so on.
So the company formed in 2009. At this point we’ve obviously just listed on the ASX, a very proud moment for all the founders, who are still very active. And we’re all looking forward to the next phase of the company. We have FDA clearances; we have many many clinical validation papers now. We have over 100 customers in the US and we’re really geared for growth. So we’re now very excited about this next period of the company.
Carolyn Herbert: The listing raised $10 million. What value does this put on the company and where are the funds going?
Dr Ralph Highnam: The post market valuation of the company was $61 million. The two main reasons for the fund raising were we’re already in the US with regulatory trials done, lots of clinical papers. We’re in around one per cent of the breast imaging centres so far, in the US. And that’s on the basis of just having two sales guys. So one of the main aims now is to really ramp up sales and marketing, in the US in particular. And we’ve already brought on a chief commercial officer. A couple of weeks ago, we actually brought on the chief marketing officer as well, from one of our biggest competitors. And we’ve got four or five more guys lined up to start in early May, now the ASX process is complete.
The second part of the fund raising was to move us from our clinical product, which tells a woman her breast composition, into a new product realm based on the Cloud. Which is specifically focused at radiology administrators, the people that run the breast imaging centres. And our software, VolparaEnterprise can actually help them quantify quality, safety and productivity in their centre, to help them run it and more cost effectively.
Carolyn Herbert: For investors who participated in the IPO, at what price did you start trading?
Dr Ralph Highnam: The starting price was 50 cents.
Carolyn Herbert: Can you tell us Ralph how your products compliment the diagnosis of breast cancer?
Dr Ralph Highnam: So our main product, for which we know now, is a product called VolparaDensity. So an x-ray is done, the images get sent to our software, we’re a software company. The software analyses the x-rays and returns to the woman, her volume of the breast and how much of that breast is non-fat tissue, or glandular tissue. Glandular tissue is the stuff that produces milk; it’s also where cancers form. So the more glandular tissue you’ve got, the higher the risk of actually developing cancer.
But also the more glandular tissue you’ve got, if cancer does develop, it becomes much harder to actually see the cancer in the x-ray. So our product allows radiologists to tell women, ‘your x-ray has been done, you’ve got high density, we can’t really see any cancer if it’s in here, you actually might want to consider an adjunctive imaging technology.’
Carolyn Herbert: What success have you had so far?
Dr Ralph Highnam: I think very quite remarkable success so far Carolyn, given that we’re a small company based in Wellington, New Zealand. We have regulatory clearances around the world. There are over 140 now clinical validation studies out there, which have proven the relationship between our product’s density measurements, and the risk of developing cancer and the risk of missing cancer. Also that we improve the consistency of radiologists’ scoring cancer. We’ve got over 100 paying customers now in the US. Frost & Sullivan have named us the winner of the Breast Density Leadership Award for 2016, which was a major honour, given the global basis of the Frost & Sullivan healthcare research reports.
Carolyn Herbert: So can you tell us now a bit about your strategy for growth going forward?
Dr Ralph Highnam: The growth strategy for next year is two pronged. One is to really drive sales in the US. And we’re really driving now into the expansion of the sales and marketing team, over there. That includes dedicating someone to really help our R&M distributors, GE Healthcare and Siemens Medical really drive sales of our product, along with their equipment. And the other side is really to launch into a SAS Enterprise wide project, aimed not at the radiologists, but at the breast centre managers.
Carolyn Herbert: Finally Ralph. Where would you like to see the company this time next year?
Dr Ralph Highnam: In April 2017, I’d like us to have a world-class sales and marketing team to match the world-class science. I’d like to have multiple SAS Enterprise customers up and running and proving the cost factors, of breast centre managers. And I’d like to see us really launching a new wave of innovation, to help the millions of women around the world, who suffer from breast cancer each year.
Carolyn Herbert: Dr Ralph Highnam, thanks for the introduction to Volpara Health Technologies.
Dr Ralph Highnam: Thanks very much Carolyn, it’s been a very exciting day and we’re really looking forward to the years ahead.