REG - Polarean Imaging PLC - Final Results
28/06/2024 07:00
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RNS Number : 2465U Polarean Imaging PLC 28 June 2024
28 June 2024
Polarean Imaging Plc
("Polarean" or the "Company")
Final Results and Directorate Changes
Notice of Annual General Meeting
Polarean Imaging plc (AIM: POLX), a commercial-stage medical device leader in
advanced Magnetic Resonance Imaging ("MRI") of lung function, announces its
audited final results for the year ended 31 December 2023.
In addition, Polarean confirms that the Annual Report and Accounts for the
year ended 31 December 2023, the Notice of the Annual General Meeting ("AGM")
and a Form of Proxy are now available on the Company's website
(http://www.polarean-ir.com/content/investors/annual-reports.asp
(http://www.polarean-ir.com/content/investors/annual-reports.asp) ) and will
be posted to shareholders shortly.
The AGM will be held at 2500 Meridian Parkway, Suite 175, Durham, NC 27713,
USA at 2:00 p.m. BST / 9:00 a.m. EDT on 24 July 2024.
Highlights
· Appointed Christopher von Jako, Ph.D. as new Chief Executive Officer
and Board Director, following the retirement of Richard Hullihen
· Received first de novo XENOVIEW™ (Xenon Xe 129 hyperpolarised)
polariser order from a top-tier U.S. academic medical centre located in the
north-eastern region of the U.S.
· Secured first order for a Xenon gas blend cylinder for the production
of XENOVIEW from Cincinnati Children's Hospital Medical Center, enabling the
first clinical scan utilising the technology in the U.S.
· Upgraded the University of Missouri Health Care polariser system to
a clinical configuration accompanied by the sale of an initial xenon gas blend
cylinder for the production of XENOVIEW
· Entered into a collaboration agreement with multinational medical
imaging technology company, Philips to advance the field of hyperpolarised
Xenon MRI
· Submitted a post-marketing commitment plan to the US Food and Drug
Administration ("FDA") to seek approval to expand the minimum current age of
XENOVIEW MRI in children from twelve to six years
· Granted New Chemical Entity designation for XENOVIEW by the FDA, with
a five-year market exclusivity period
· Received 510(k) clearance from the FDA for the Company's specialised
MRI chest coil to now include Philips 3.0T MRI scanners for visualisation of
the Xenon 129 nuclei
· New reimbursement C-code (C9791) from the US Centers for Medicare
& Medicaid Services ("CMS") for the XENOVIEW MRI technology which
corresponds to a payment range of between US$1,201 to US$1,300
· Requested and granted a formal Type B meeting in October 2023 with
the FDA's Center for Drug Evaluation and Research division to seek guidance on
the clinical plan related to the XENOVIEW indication expansion, which includes
both regional visualisation and quantitative assessment of gas exchange and
microvascular haemodynamics for both pulmonary and cardio-pulmonary diseases
· Partnered with VIDA Diagnostics ("VIDA") to further enable the
Polarean Xenon 129 MRI platform to accelerate clinical and research use
· Net cash of $6.2 million as of 31 December 2023 (31 December 2022:
$16.4 million)
Post period end highlights
· Successfully raised gross proceeds of US$12.6 million (£9.9
million), including participation of existing strategic partners NUKEM
Isotopes GmbH and Bracco Imaging S.p.A., and certain Directors and management
of the Company demonstrating their continued support and extending cash runway
until at least Q1 2026
· Received first de novo XENOVIEW (Xenon Xe 129 hyperpolarised)
polariser order from the University of Alabama at Birmingham, a top-tier
academic hospital in the south-eastern region of the U.S.
· U.S. Patent granted for dynamic cardiopulmonary blood flow imaging
with Xenon MRI
· Received an order from Cincinnati Children's Hospital Medical Center
for a new polariser to upgrade its existing research system to provide
additional flexibility for research and clinical scanning
· Bastiaan Driehuys, Ph.D., Marcella Ruddy, M.D. and William Blair
notified the Company of their intention to resign from their roles as
Directors of the Board, with effect from 24 July 2024. Dr. Driehuys will
retain his role as Chief Scientific Officer. Departures will result in a
seven-member Board, an appropriate size and skill set for the Company
Christopher von Jako, Ph.D., CEO of Polarean, commented: "It is now one year
since I joined the excellent team at Polarean and I am very pleased with the
progress we have made so far. Most recently in May, we announced a successful
Placing, Subscription and Open Offer where we raised gross proceeds of US$12.6
million (£9.9 million), which we will use to accelerate the commercialisation
of XENOVIEW, support our continued investment in research and development
including, amongst other developments, finalisation of the FDA plan to expand
indications to gas exchange, and continue to develop strategic partnerships.
The fundraise will enable us to substantially progress implementation of our
five-pillar growth strategy in pursuit of its mission to revolutionise
pulmonary medicine.
"We also achieved a number of key milestones in 2023, making significant
progress with the FDA and in pursuit of reimbursement, as well as through the
signing of key partnerships in the pulmonary space. With a current total of
approximately 17 installed sites, we will continue to work closely with
existing and target hospitals to facilitate the adoption and consistent
utilisation of our cutting-edge technology. Thus far in 2024, we have
completed sales and received orders that could result in revenues of $2.5
million. We expect further sales and additional resulting revenue for the
year, particularly with our ability to expand our commercial team as a result
of a successful fundraise.
"On behalf of the Board and the whole Polarean team, I would like to extend my
thanks to our shareholders for all their support and we look forward to
further updating the market in due course. I would also like to take this
opportunity to thank Bastiaan, Marcie and Bill, who will be stepping down from
their Board roles next month, for their contributions to the Company."
This announcement contains inside information for the purposes of Article 7 of
Regulation (EU) 596/2014, as it forms part of domestic law by virtue of the
European Union (Withdrawal) Act 2018.
Enquiries:
Polarean Imaging plc www.polarean.com / www.polarean-ir.com
Christopher von Jako, PhD, Chief Executive Officer Via Walbrook PR
Charles Osborne, Chief Financial Officer
Stifel Nicolaus Europe Limited (NOMAD and Sole Corporate Broker) +44 (0)20 7710 7600
Nicholas Moore / Samira Essebiyea / Kate Hanshaw (Healthcare Investment
Banking)
Nick Harland (Corporate Broking)
Walbrook PR Tel: +44 (0)20 7933 8780 or polarean@walbrookpr.com
(mailto:polarean@walbrookpr.com)
Anna Dunphy / Phillip Marriage Mob: +44 (0)7876 741 001 / +44 (0)7867 984 082
About Polarean
Polarean is a revenue-generating medical imaging technology company
revolutionizing pulmonary medicine through direct visualization of lung
function by introducing the power and safety of MRI to the respiratory
healthcare community. This community is in desperate need of modern solutions
to accurately assess lung function. The Company strives to optimize lung
health and prevent avoidable loss by illuminating hidden disease, addressing
the global unmet medical needs of more than 500 million patients worldwide
suffering from chronic respiratory disease. Polarean is a leader in the field
of hyperpolarization science and has successfully developed the first and only
hyperpolarized Xenon MRI inhaled contrast agent, XENOVIEW™, which is now
FDA-approved in the United States. Polarean is dedicated to researching,
developing, and commercialising innovative imaging solutions with its
non-invasive and radiation-free pulmonary functional MRI platform. This
comprehensive drug-device platform encompasses the proprietary Xenon gas
blend, gas hyperpolarization system, as well as software and accessories,
facilitating fully integrated modern respiratory imaging operations. Founded
in 2012, with offices in Durham, NC, and London, United Kingdom, Polarean is
committed to increasing global awareness of and broad access to its XENOVIEW
MRI technology platform. For the latest news and information about Polarean,
please visit www.polarean.com (http://www.polarean.com)
XENOVIEW IMPORTANT SAFETY INFORMATION
Indication
XENOVIEW™, prepared from the Xenon Xe 129 Gas Blend, is a hyperpolarized
contrast agent indicated for use with magnetic resonance imaging (MRI) for
evaluation of lung ventilation in adults and pediatric patients aged 12 years
and older.
Limitations of Use
XENOVIEW has not been evaluated for use with lung perfusion imaging.
CONTRAINDICATIONS
None.
Warnings and Precautions
Risk of Decreased Image Quality from Supplemental Oxygen: Supplemental oxygen
administered simultaneously with XENOVIEW inhalation can cause degradation of
image quality. For patients on supplemental oxygen, withhold oxygen inhalation
for two breaths prior to XENOVIEW inhalation, and resume oxygen inhalation
immediately following the imaging breath hold.
Risk of Transient Hypoxia: Inhalation of an anoxic gas such as XENOVIEW may
cause transient hypoxemia in susceptible patients. Monitor all patients for
oxygen desaturation and symptoms of hypoxemia and treat as clinically
indicated.
Adverse Reactions
Adverse Reactions in Adult Patients: The adverse reactions (> one patient)
in efficacy trials were oropharyngeal pain, headache, and dizziness. Adverse
Reactions in Pediatric and Adolescent Patients: In published literature in
pediatric patients aged 6 to 18, transient adverse reactions were reported:
blood oxygen desaturation, heart rate elevation, numbness, tingling,
dizziness, and euphoria. In at least one published study of pediatric patients
aged 6 to 18 years, transient decrease in SpO2% and transient increase in
heart rate was reported following hyperpolarized xenon Xe 129 administration.
XENOVIEW is not approved for use in pediatric patients less than 12 years of
age.
Please see full prescribing information at www.xenoview.net
PLC-RNS-2334
Chairman's statement
2023 was a challenging year for the Company, but we accomplished some
important milestones that we believe have set the Company up for future
success.
With approval of XENOVIEW™ by the United States ("US") Food and Drug
Administration ("FDA") in late December of 2022, we began the process of
obtaining insurance reimbursement for our novel imaging procedure and also
began the relatively lengthy hospital decision processes for the acquisition
of new capital equipment and the incorporation of novel diagnostic methods
into routine clinical practice. We have had success in achieving strong
reimbursement and are seeing progress in accelerating the rate of clinical
adoption.
To lead our Company's commercialisation effort, we recruited Dr. Christopher
von Jako as CEO, upon the retirement of Richard Hullihen. Chris has extensive
experience bringing novel MedTech products to market, and his training and
expertise in radiology are an excellent fit for Polarean as we continue our
dual strategy of achieving commercial sales of XENOVIEW™ and establishing
strategic industry collaborations to accelerate growth worldwide. Chris has
done an excellent job refining and implementing a strategy to enable the
Company to achieve commercial success. The development and implementation of
the five-pillar growth strategy announced with our Half-Year results RNS in
September 2023 has brought focus and energy to the Company and is resulting in
tangible results.
In June 2024, in a difficult environment for emerging companies, we closed on
a financing with gross proceeds of $12.6 million. This financing will enable
the Polarean team to continue execution of our commercial strategy until at
least Q1-2026. I want to particularly thank NUKEM and Bracco for their
significant support of the financing and our commercialisation efforts. Both
groups have been long-term supportive partners to Polarean.
On behalf of the Board, I also want to thank our employees and business
partners for their untiring efforts in the commercialisation of our products,
and also our shareholders for their continued support.
Kenneth West
Non-Executive Chairman
27 June 2024
Chief Executive Officer's Statement
2023 - CEO Transition
I was pleased to join Polarean as Chief Executive Officer and Director in June
2023, succeeding Richard Hullihen upon his retirement. With over 30 years of
global healthcare leadership experience, I have successfully led both private
and publicly listed companies. My proven track record in commercialization,
alongside developing and executing sound business and operational strategies,
spans across multiple healthcare sectors, including radiology, pulmonology,
and various surgical interventions.
I am excited to be with Polarean at this pivotal stage in the Company's
development. I am confident that our current and future advanced imaging
platform will significantly aid clinicians in managing their patients' lung
conditions. I look forward to continuing to work with our team to expand the
reach of the XENOVIEW™ technology.
Strategy Development and Implementation
As I joined the dynamic Polarean team, we revisited all our strategic business
initiatives with the intent of creating an increased focus on key business
drivers. As a result, we have identified five specific growth initiatives:
driving utilisation at our newly established clinical sites, expanding to our
highest priority targeted clinical sites, establishing reimbursement coverage
and payment, expanding our total addressable market, and developing and
fostering key industry partnerships.
In February 2024, we provided an update on our progress implementing our
five-pillar growth strategy.
· Drive utilisation: When new medical devices are introduced, hospital
physicians need to be educated on their benefits in order to drive
utilisation. The Polarean commercial team has been regularly visiting the
Company's initial two clinical sites, Cincinnati Children's Hospital and the
University of Missouri Health Care, educating pulmonologists and radiologists
on the benefits of the XENOVIEW technology. The number of scans at these sites
has been steadily increasing.
· Grow user base: Hospital acquisition of capital equipment is a
notoriously lengthy process, with an average time from introduction to sales
closing of between 18 to 24 months in the US. The Company has been actively
navigating obstacles to transition multiple research sites to clinical status,
alongside engaging new sites to introduce the Polarean pulmonary functional
magnetic resonance imaging ("MRI") technology as a solution to their unmet
diagnostic needs. Both existing and potential customers are becoming
increasingly aware of the technology's value in lung ventilation diagnostics
and its significant future growth opportunities in gas exchange and
cardiopulmonary applications.
· Broaden reimbursement coverage: In adopting new diagnostic
technologies, US-based hospitals look carefully at the return on investment,
driven by the reimbursement rates of private and government insurers.
Following the Centers for Medicare & Medicaid Services issuance of the
reimbursement code for XENOVIEW scans and the associated reimbursement rate of
between US$1,201 and US$1,300 in October 2023, hospitals are steadily
recognising the economic benefits of integrating the XENOVIEW technology into
the clinical care pathway for patients with lung disease. Medicare (the U.S.
government-funded health insurance for people aged 65 and older) coverage is
important in the elderly population suffering from chronic lung diseases that
XENOVIEW is tailored to address. Polarean has confirmed that the initial
clinical sites have attained reimbursement by both select private insurers and
Medicaid (the U.S. government-funded programme providing health coverage to
low-income individuals and families). The Company is working to broaden
reimbursement coverage with additional private U.S. health insurers to
strengthen the value proposition for the adoption of XENOVIEW.
· Expand total addressable market: In its initial regulatory approval,
the FDA outlined specific requirements to expand the approved patient age
range for XENOVIEW from twelve to six years old, marking a significant
milestone in the product's accessibility to younger patients. The Company has
made notable progress in meeting these FDA requirements. Additionally, the
Company is incorporating insights gathered from the October 2023 FDA meeting
to support a development plan for the approval of new indications including
gas exchange and cardiopulmonary applications. With XENOVIEW's safety
demonstrated in the prior Phase 3 clinical trials combined with over a decade
of research and publications on gas exchange and cardiopulmonary applications,
the Company is confident that a forthcoming clinical trial required to expand
the indications for XENOVIEW has been considerably de-risked.
· Further develop partnerships: The Company's existing strategic partners
Philips (a leading MRI company), VIDA (a leading clinical lung imaging
intelligence company), and NUKEM Isotopes (a leading medical stable isotope
supplier), remain involved and instrumental in helping advance the XENOVIEW
technology. Additionally, Polarean has been actively engaging multiple
pharmaceutical ("Pharma") and medical technology ("MedTech") companies to
increase awareness and adoption of the Polarean technology. Currently,
clinicaltrials.gov lists numerous clinical trials underway that utilise Xenon
MRI technology to evaluate the effectiveness of existing and new
pharmaceutical treatments. In January 2024, the Company participated in the
annual 129Xe MRI Clinical Trials Consortium Meeting. This meeting also brought
together other representatives from the Pharma and MedTech sectors, like GE
HealthCare, Genentech, Philips, and Siemens, to share insights and
advancements of Xenon MRI.
In May 2024 we announced our second de novo system order of the year from The
University of Alabama at Birmingham Hospital, a prestigious top-tier US
academic facility. As described, hospital acquisition of new capital equipment
can be a lengthy process, and so momentum continues to build for our sales
success. Contingent on the installation of this polariser system, and the two
additional previously announced system orders, the Company has completed sales
and firm orders as of today that would result in 2024 revenue of approximately
US$2.5M. We expect additional orders to come in this year that will result in
additional 2024 revenue. We are very excited to see that our commercial growth
strategy is yielding tangible results.
Financials
Sales for 2023 were below our original expectations, as the capital sales
process at hospitals took longer than the Company had originally anticipated.
Upon my appointment and subsequent review of the strategy, we reduced our
sales forecasts and adjusted our spending plans to extend our cash runway.
This prudent financial management allowed us to finish 2023 with a
higher-than-anticipated cash balance of US$6.2 million.
On 18 June 2024, we announced the results of a financing with gross proceeds
of US$12.6 million. This financing is expected to support the company
financially until at least Q1-2026.
2024 and Beyond
As outlined earlier, we are laser-focused on executing our five-pillar growth
strategy. With the recent financing closed, we are expanding our commercial
team to achieve the sales targets set in our February 2024 Strategy Update
RNS.
Our mission is revolutionizing pulmonary medicine through direct visualization
of lung function, and our vision is to optimize lung health and prevent
avoidable loss by illuminating hidden disease. These guiding principles drive
our efforts as we strive to make a significant impact on pulmonary health.
I want to express my gratitude to the investors who participated in the recent
financing for their support. I also extend my heartfelt thanks to our
dedicated team of employees, consultants, and advisers who work tirelessly on
our mission. Their commitment is evident in the lives we are already
improving, as our advanced imaging technology helps clinicians manage their
patients more effectively.
Together, we are making a meaningful difference in lung health and advancing
our mission to revolutionize pulmonary medicine.
Christopher von Jako, Ph.D.
Chief Executive Officer
27 June 2024
Consolidated Statement of Comprehensive Income
2023 2022
Notes US$ US$
Revenue 4 890,933 1,033,008
Cost of sales (555,450) (684,732)
Gross profit 335,483 348,276
Administrative expenses (3,337,836) (2,839,543)
Research, development and regulatory expenses (4,194,006) (5,625,223)
Depreciation 11 (208,786) (277,461)
Amortisation 12 (728,411) (760,780)
Selling and distribution expenses (3,562,412) (3,310,592)
Share-based payment expense 19 (860,195) (1,205,247)
Total operating costs (12,891,646) (14,018,846)
Operating loss 6 (12,556,163) (13,670,570)
Finance income 7 298,899 35,045
Finance expense 7 (15,990) (23,762)
Other gains/(losses) - net 7 388,451 (246,309)
Loss before tax (11,884,803) (13,905,596)
Taxation 10 - -
Loss for the year and total other comprehensive expense (11,884,803) (13,905,596)
Loss per share
Basic and diluted (US$) 9 (0.055) (0.066)
The results reflected above relate to continuing activities.
There are no items of Other Comprehensive Income ("OCI") for the year other
than the loss above and therefore no separate statement of other comprehensive
income has been presented.
Consolidated Statement of Financial Position
Notes 2023 2022
US$ US$
ASSETS
Non-current assets
Property, plant and equipment 11 288,627 418,498
Intangible assets 12 969,339 1,581,591
Right-of-use assets 24 158,129 274,288
Trade and other receivables 14 387,961 437,539
1,804,056 2,711,916
Current assets
Inventories 15 2,221,823 1,711,419
Trade and other receivables 14 685,117 1,659,649
Cash and cash equivalents 16 6,171,636 16,454,241
9,078,576 19,825,309
TOTAL ASSETS 10,882,632 22,537,225
EQUITY AND LIABILITIES
Equity attributable to holders of the parent
Share capital 17 104,780 103,463
Share premium 18 59,305,160 59,288,383
Group re-organisation reserve 18 7,813,337 7,813,337
Share-based payment reserve 19 5,725,774 4,865,579
Accumulated losses 18 (64,650,607) (52,765,804)
8,298,444 19,304,958
Non-current liabilities
Contract liabilities 21 67,032 128,704
Trade and other payables 22 240,000 360,000
Lease liability 24 74,846 216,691
Contingent consideration 20 - 316,000
381,878 1,021,395
Current liabilities
Trade and other payables 22 1,831,587 1,979,001
Lease liability 24 141,845 142,146
Contract liabilities 21 228,878 89,725
2,202,310 2,210,872
TOTAL EQUITY AND LIABILITIES 10,882,632 22,537,225
Consolidated Statement of Changes in Equity
Share capital Share premium Share-based payment reserve Group Accumulated losses Total equity
US$
US$
US$
US$
re-organisation reserve US$
US$
As at 1 January 2022 101,642 59,022,919 3,660,332 7,813,337 (38,860,208) 31,738,022
Comprehensive income
Loss for the year - - - - (13,905,596) (13,905,596)
Transactions with owners
Issue of shares 1,821 265,464 - - - 267,285
Share issue costs
Share-based payment expense - - 1,205,247 - - 1,205,247
As at 31 December 2022 (audited) 103,463 59,288,383 4,865,579 7,813,337 (52,765,804) 19,304,958
Comprehensive income
Loss for the year (11,884,803) (11,884,803)
Transactions with owners
Issue of shares 1,317 16,777 - - - 18,094
Share-based payment expense - - 860,195 - - 860,195
As at 31 December 2023 104,780 59,305,160 5,725,774 7,813,337 (64,650,607) 8,298,444
Consolidated Statement of Cash Flows
2023 2022
US$
US$
Cash flows from operating activities
Loss before tax (11,884,803) (13,905,596)
Adjustments for non-cash/non-operating items:
Depreciation of property, plant and equipment 208,786 277,461
Amortisation of intangible assets and right-of use-assets 728,411 760,780
Loss on disposal of property, plant and equipment - 2,766
Share-based payment expense 860,195 1,205,247
Net foreign exchange (gains)/losses (72,451) 246,309
Writeback of contingent consideration (316,000) -
Finance expense 15,990 23,762
Finance income (298,899) (35,045)
Operating cash outflows before movements in working capital (10,758,771) (11,424,316)
Decrease/(Increase) in inventories (510,404) (284,609)
Decrease/(increase) in trade and other receivables 1,024,108 (1,120,681)
Increase/(decrease) in trade and other payables (267,413) 607,887
Increase/(decrease) in contract liabilities 77,482 (36,312)
Net cash used in operations (10,434,998) (12,258,031)
Cash flows from investing activities
Purchase of property, plant and equipment (78,915) (63,946)
Dividend and interest received 298,899 35,045
Net cash used in investing activities 219,984 (28,901)
Cash flows from financing activities
Issue of shares 18,094 267,285
Interest paid on lease liabilities (15,990) (23,762)
Principal elements of lease payments (142,146) (130,949)
Net cash generated by financing activities (140,042) 112,574
Net decrease in cash and cash equivalents (10,355,056) (12,174,358)
Cash and cash equivalents at the beginning of year 16,454,241 28,874,908
Effect of foreign exchange rate changes on cash and cash equivalents 72,451 (246,309)
Cash and cash equivalents at end of year 6,171,636 16,454,241
For access to the full notes on these statements, please click here
(https://www.polarean-ir.com/content/investors/annual-reports) for the Annual
Report.
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