By Ian Lyall – Proactive Investors
Distilled down to the basics, the company’s TexRAD technology is essentially a very smart piece of software that analyses medical images, to reveal features that are not always evident to the human eye.
Dr Alastair Riddell’s CV reveals a high-flying career with the forerunners of what are now GE Healthcare, Johnson & Johnson and Pfizer, followed by spells guiding businesses to IPO or trade sale.
So, what attracted him to the challenge of Feedback plc (LON:FDBK), an AIM-listed medical imaging firm worth less than £4mln?
“The persistence of Tom Charlton, who would not give me any peace until I said yes,” jokes Riddell.
Charlton is one of Feedback’s major shareholders who recruited the company’s new chairman.
However, Riddell’s mind was actually made up by cold hard data that underscored the potential of its main product, TexRAD.
“When I went to Cambridge and spoke to the people who do the work there it became clear there was real potential in this,” he told Proactive Investors.
“What really convinced me was a small study they’d done.”
Before we get to that study, it is worth getting a feel for TexRAD does.
It was the brainchild of the PhD of Dr Balaji Ganeshan, an expert on textural analysis of images gleaned from computed tomography (CT) scans.
Distilled down to the basics, it is essentially a very smart piece of software that analyses medical images, to reveal features that are not always evident to the human eye.
In doing so, it may “in a very statistical, objective and numerical way relate the output to a prognosis for the patient”, says Riddell.
Ganeshan carried out a study of patients with liver cancer using TexRAD and the results were, in the words of the Feedback chairman, “quite remarkable”.
“It quickly dawned on me that this could be a really valuable objective tool for giving an accurate prognosis,” he adds.
Riddell was announced as chairman in June, which hasn’t given him a lot of time to shape strategy.
But he has a good idea how to get the business into the full commercial phase within the next six to nine months.
He has hired a person with experience in the imaging industry to put together a marketing strategy and business plan “which should be sorted in the next few weeks”.
Feedback is already making money from TexRAD with sales to institutions carrying out research.
To fully commercialise the product it must be granted a CE Mark, European certification for the technology.
It hopes to receive the regulatory green light sometime in the first quarter of next year.
This will enable it to sell TexRAD to hospitals, where it will lend numerical support to the very skilled, interpretative work carried out by radiologists.
At that point it will require funds to hire a sales and sales support team, which in turn means Feedback will have to raise a little money to bankroll the expansion of what is currently a very lean team.
Riddell, the consummate City veteran, won’t say when he will call on shareholders, or just how much Feedback requires, but he acknowledges there will be a need to fund growth.
“We will go the market when I think we have a compelling story and we have some numbers for the market,” he says.
“We are not yet at that stage. We are ticking over; investing a little in market analysis and market development that I think will pay off.”
Riddell’s sights are set first and foremost on securing the CE mark. After that he expects to be able to unveil a new product that analyses tumour deposits in the lung.
In this regard it has partnership with a firm called Alliance Medical Group, which wants to integrate TexRAD into its scanners.
Meanwhile, a tie-up with a company in Poland called Future Processing provides Feedback with the coding know-how to develop a wider product suite.
Sales of the current product, though modest, reveal there is demand from a very specialist audience in the research sphere.
It means the technology is being cited in literature by some of the leading centres for cancer research – providing a great endorsement of the TexRAD from key opinion leaders.
In fact, the technology is also starting to make an impression with businesses operating in the field.
“My view is at the moment we are far too small and far too young to be engaged in corporate discussion,” says Riddell.
“But, if we can grow sales the way I hope we can grow them, then in two or three years we might look differently at these corporate approaches.”
In the meantime, it is about “investing in the company and doing things to a particular standard”, the Feedback chairman says.
“Of course, the next milestone will be getting the CE Mark for TexRAD,” he adds.
“This will enable us to market not just to scientists, but radiologists everywhere, which should lead to a marked expansion in sales.”
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