Medical technology developer Osprey Medical (ASX: OSP) has unveiled a potentially significant commercial deal in the form of a “strategic alliance” with US giant GE Healthcare.
The deal has been keenly anticipated by market analysts after the two companies announced the signing of a non-binding term sheet in April this year.
Under the terms of the four-year deal, GE Healthcare will obtain exclusive distribution for Osprey’s entire product suite in Europe, Russia, the Middle East, Africa, Central Asia and Turkey.
The agreement means GE Healthcare will commercialise Osprey’s DyeVert portfolio and likely extend the kidney protection technology to new markets throughout Europe, while also bagging first refusal rights for any products Osprey develops over the next four years.
According to Osprey, DyeVert reduces the amount of dye that reaches patients’ kidneys, with Osprey claiming it can achieve a 40% average reduction with no compromise in image quality.
Meanwhile, GE Healthcare’s pharmaceutical diagnostics division develops imaging agents used to support approximately 90 million procedures per year globally, equivalent to three patients every second.
Its range of products includes iodinated X-ray contrast media used in interventional and other diagnostic procedures including coronary angiography.
Osprey declared that combined, its DyeVert contrast minimisation technology and GE Healthcare’s range of iodinated x-ray contrast media, would offer healthcare professionals a technology platform to address the rising problem of acute kidney injury (AKI) following interventional coronary angiograms in patients with chronic kidney disease (CKD).
“GE Healthcare and Osprey share a similar goal rooted in improving patient outcomes. Both our product portfolios and educational efforts, which are aligned with cardiology guidelines for AKI minimisation, offer interventional cardiologists the opportunity to safely image patients by reducing the risk of AKI,” GE Healthcare’s Pharmaceutical Diagnostics business president and chief executive officer Kevin O’Neill said.
Osprey has developed proprietary technologies that reduce the amount of dye injected into patients during heart catheterisation procedures, without compromising X-ray image quality.
Osprey’s DyeVert technology is used by physicians to minimise dye usage and monitor dosing in real-time during heart imaging procedures.
The technology was developed after research found the amount of dye used during angiographic imaging procedures increased a patient’s risk of dye-related kidney damage known as “contrast-induced acute kidney injury”.
The range of products developed by Osprey includes DyeVert, DyeVert Plus and DyeVert Plus EZ, with the latter launched in the US in 2018.
With one out of four angiography patients presenting with CKD, Osprey has said that patients developing AKI is currently a “serious concern” for catheterisation labs and hospitals.
The European Society of Cardiology and European Association for Cardio-Thoracic Surgery has issued joint guidelines for the reduction of AKI that recommend better patient screening for the risk of AKI, ensuring ample hydration, better dye selection and reducing the volume of dye injected into patients.
“Osprey and GE Healthcare’s portfolios are aligned with these guidelines so that healthcare professionals can help minimize AKI complications in patients with CKD,” Osprey said.
Kickstarting medical procedures
Following a gruelling Q2 2020 that saw the COVID-19 pandemic bite into all economic activity, Osprey has published an interim update on its company performance.
In Q2 2020, Osprey reported that it sold 1,642 DyeVert units, a 7% decline on a quarter-on-quarter basis and a 48% decline year-on-year.
The decline in unit sales in Q2 was driven by COVID-19 disruptions, which resulted in the postponement of elective heart procedures and restricted access to hospitals for the majority of the quarter. Moreover, Osprey said that its European sales were “stagnant” due to COVID-19 related hospital procedure suspensions.
Osprey also reported a 61% drop in quarterly sales revenue to US$226,000 (A$314,000) while its recorded cash receipts were down 60% compared to the prior quarter at US$306,000 (A$426,000).
Also in Q2, Osprey completed a A$14.7 million capital raising and tapped the US Paycheck Protection Program to boost working capital reserves and accelerate commercial expansion in the US.
This will include supporting GE Healthcare’s commercial efforts and undertaking ongoing clinical evidence and product portfolio development.
“Osprey has bounced back following the re-introduction of elective procedures in the US, buoyed by the introduction of the ‘In-Kind for Kidneys’ marketing initiative which saw our product gain traction with customers during a time of limited sales rep access and severe COVID-19 disruptions,” Osprey chief executive officer Mike McCormick said.