Bid on Imricor Medical Systems, Inc. Offer through OnMarket

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IPO
Biotech
$0.83
Size of Offer Up to $12.1 million
Minimum Bid $2,000.00
Opening Date 12/08/2019
Closing Date 20/08/2019

 

The Imricor Medical Systems, Inc. IPO has closed for applications via OnMarket.  

The IPO is underwritten by lead manager Moelis Australia, and OnMarket has a limited allocation. Bids more than $5,000 may be scaled back more heavily. 

The offer may close early and the payby dates may change. Duplicate bids under the same investment profile, investor name or residential address may be cancelled.

Introduction

Imricor Medical Systems, Inc. (ASX:IMR) is a U.S.-based medical device company, focused on designing, manufacturing and selling MRI-compatible products for cardiac catheter ablation procedures to treat arrhythmias. Imricor believes it will be the first company in the world to bring commercially viable and safe MRI-compatible products to the cardiac catheter ablation market.

Imricor currently has 18 issued U.S. patents, 40 corresponding granted foreign patents and 2 foreign patent applications that have been allowed.

Imricor currently generates revenue from licensing IP for use in implantable devices and a contract research project in the area of MRI-guided interventions. However, given that the company has obtained CE mark approval to place one of its key products, the Advantage-MR EP Recorder/Stimulator System, on the market in the European Union, and is in the final stages of the CE mark approval process for its other key products, the Vision-MR Ablation Catheter (with an indication for treating type I atrial flutter) and the Vision-MR Dispersive Electrode, Imricor plans to establish a third revenue stream from the sale of these products. This third revenue stream is expected to become its primary revenue source, with forecast revenues of US$6.9 million for 2019.

Following receipt of CE mark approval for the Vision-MR Ablation Catheter, Imricor intends to begin a controlled limited release of its key products to iCMR lab sites in the Netherlands, Austria, Germany and Switzerland (Phase One of three phases), and is aiming to have 13 iCMR lab sites purchasing consumable products by the end of 2019.

Imricor's Advantage-MR EP Recorder/Stimulator System

Investment Highlights

  • Expects to have the world’s first commercially available MRI-compatible catheter ablation devices

  • Large addressable market, growing to US$4.37bn in 2021, with favorable market drivers including rising incidences of cardiac disease and a shift towards minimally invasive procedures

  • Leveraging strategic relationships with Koninklijke Philips N.V. and Siemens Healthcare GmbH, global leaders in the provision of MRI equipment to hospitals and labs

  • The potential to successfully address unmet needs in the ablation technology currently and deliver value to stakeholders, including patients, physicians, hospitals and insurers

  • Strong IP portfolio and IP protection with 18 issued U.S. patents, 40 corresponding granted foreign patents, 2 foreign patent applications that have been allowed and 17 pending patent applications worldwide

  • Founder-led business with deep med-tech experience management team

Offer Details

Imricor is looking to raise approximately A$11.1 million by issuing 13,373,494 new CHESS Depositary Interests (CDIs) representing shares of Class A common stock in Imricor (Shares) at A$0.83 per CDI (Offer Price), with the ability to accept oversubscriptions for up to 1,204,819 new CDIs to raise an additional A$1.0 million (the Offer).

Lead manager, Moelis Australia, has underwritten the Offer up to A$11.1 million, being the minimum offer proceeds.

Imricor is also conducting a concurrent private placement of 1,084,337 Shares (equivalent to the same number of CDIs) to certain accredited investors in the U.S. pursuant to Regulation D of the U.S. Securities Act (U.S. Private Placement). The U.S. Private Placement will be at the equivalent price per Share as the Offer Price (but in U.S. dollars).

The Offer and the U.S. Private Placement are together referred as the Combined Offers and are expected, together, to raise minimum gross proceeds of A$12 million (approximately US$8.2 million) or maximum gross proceeds of A$13 million (approximately US$8.9 million).

Industry Overview

Arrhythmia is an abnormal heart rhythm. Certain untreated arrhythmias can lead to serious cardiac conditions, such as blood clotting, stroke and/or death.

Where a long-term treatment option is required (as opposed to acute treatment options for arrhythmias which require immediate management), cardiac catheter ablation is one of the recommended first-line therapies for the treatment of a number of different type of arrhythmias. The procedure involves an electrophysiologist (a cardiologist with specialist training in the treatment of arrhythmias) guiding a catheter into the heart and aiming the tip of the catheter at one or more areas of abnormal heart tissue. Energy travels through the tip of the catheter with the aim of intentionally creating a scar or permanently destroying (also referred to as creating lesions or ablating) the tissue that triggers or supports the arrhythmia.

The market for cardiac catheter ablation procedures is experiencing increased global growth in developed economies such as the United States, Europe, the Middle East and Africa and the Asia Pacific.

This growth is supported by drivers such as:

  • rising incidences of cardiac diseases;
  • a shift towards minimally invasive procedures with improved medical imaging; and
  • cost savings that have been associated with catheter ablation as a treatment method for certain arrhythmias.

Based on a recent industry report and other market data, the market for cardiac ablations is expected to grow by a CAGR of 7.6%, with annual revenues across the global cardiac ablation market forecasted to increase from US$3.03 billion in 2016 to US$4.37 billion in 2021.

Global cardiac ablation market annual revenue 2016-2021 (US$ billions)

 

Product offering

Imricor designs and manufactures consumable products and capital equipment; all of which are designed to be used in performing MRI-guided cardiac catheter ablation procedures. Imricor’s key products are the Advantage-MR EP Recorder/Stimulator System, the Vision-MR Ablation Catheter and the Vision-MR Dispersive Electrode. The Advantage-MR EP Recorder/Stimulator System is capital equipment which can be used in multiple procedures, while the Vision-MR Ablation Catheter and the Vision-MR Dispersive Electrode are single-use consumable products.

Imricor is also in the process of developing other products for use in cardiac catheter ablation procedures, and is exploring the potential to develop MRI compatible products for use in a number of other types of procedures which may be more effectively carried out under MRI guidance.

Value proposition for stakeholders

Whilst MRI technology is not new, there are several challenges associated with developing products for MRI-guided cardiac catheter ablation. Imricor has overcome these challenges to deliver what it believes to be the world’s first commercially viable MRI-guided cardiac catheter ablation solution. Imricor believes its products have the potential to successfully address unmet needs and deliver value to stakeholders, including patients, physicians, hospitals and insurers in the following ways:

 

Intellectual Property

Imricor has 18 issued U.S. patents, 40 corresponding granted foreign patents and 2 foreign patent applications that have been allowed. In addition, Imricor has 17 pending patent applications world-wide. Imricor’s intellectual property is relatively new, with the Company’s oldest issued patent expiring in 2030. In addition to protecting Imricor’s devices and procedures, its patents provide an opportunity for the Company to license its technology to third party medical device companies (particularly implant manufacturers) to help make their devices compatible with MRI.

Business model

Imricor currently generates revenue from licensing IP for use in implantable devices and a contract research project in the area of MRI-guided interventions. Post CE mark approval, Imricor plans to establish a third revenue stream which, in the future, is expected to become its primary revenue source, from the sale of MRI-compatible catheter ablation products to hospitals and clinics for use in Interventional Cardiac Magnetic Resonance Imaging (iCMR) labs.

Sales Channels

The installation of iCMR labs by hospitals and clinics is driven by MRI equipment vendors (MR vendors). Imricor works collaboratively with MR vendors such as Koninklijke Philips N.V. and Siemens Healthcare GmbH to target certain sites and help design iCMR labs for those sites. As of the date of the Prospectus, Imricor, in collaboration with Koninklijke Philips N.V. and Siemens Healthcare GmbH, is currently in discussions with over 45 hospitals and clinics about establishing an iCMR lab.

Though Imricor will initially sell all of its capital and consumable products directly to the hospitals or clinics, it is pursuing agreements with MR vendors such as Siemens Healthcare GmbH and Koninklijke Philips N.V., which will allow the Advantage-MR EP Recorder/Stimulator System to be sold to hospitals and clinics through these MR vendors as part of a larger lab construction package.

Growth Strategy

Following completion of the Combined Offers and receipt of CE mark approval for the Vision-MR Ablation Catheter, Imricor intends to begin a controlled limited release of its key products to iCMR lab sites in the Netherlands, Austria, Germany and Switzerland (Phase One), and is aiming to have 13 iCMR lab sites purchasing consumable products by the end of 2019.

Imricor aims to then expand its focus to Australia (if and when Australian regulatory approval is obtained), France, Hungary and the United Kingdom in 2021 (Phase Two), followed by the Czech Republic, Italy, Spain, Sweden and other EU countries around 2023 (Phase Three).

The actual timing of these phases will, however, depend on a number of factors such as the level of adoption in each preceding phase and when greater growth opportunities are identified in the next phase.

Proposed use of funds

The Combined Offers are being conducted to:

  • Fund the commercial launch of the Advantage-MR EP Recorder/Stimulator, Vision-MR Ablation Catheter and Vision-MR Dispersive Electrode in the European Union;
  • Grow sales, marketing, and manufacturing capabilities to support commercialisation in the European Union;
  • Progress regulatory approvals for the Australian and U.S. markets;
  • Continue to develop the Company’s line extensions (including the diagnostic catheter) and additional products; and
  • Fund general working capital requirements

Risks

An investment in Imricor is subject to a range of risks which, if they eventuate, could have a significant negative effect on Imricor’s business, financial position and the value of your investment. The key risks associated with an investment in the Company are contained in Section 4 of the Prospectus, which should be considered in detail.

 

Section 734(6) disclosure: The issuer of the securities is Imricor Medical Systems, Inc. ARBN 633 106 019 . The securities to be issued are CDIs. The disclosure document for the offer can be obtained by clicking on the link above. The offers of the securities are made in, or accompanied by, a copy of the disclosure document. Investors should consider the disclosure document in deciding whether to acquire the securities. Anyone who wants to acquire the securities will need to complete the application form that will be in or will accompany the disclosure document (which can be done via the electronic application form which will become available by clicking the bid button above).‚Äč

 

OnMarket has a limited allocation. The offer may close early and the 'Pay By' dates may change. Bids over $5,000 may be scaled back more heavily. Duplicate bids under the same investment profile, investor name or residential address may be cancelled.

# Information Type Information Details (Click on Link)
1 Prospectus Replacement Prospectus

OnMarket | Imricor Medical Systems, Inc. | ASX:IMR

Disclaimer: All information on this section is of a general nature. Before making any investment decision, please seek the relevant advice.

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