‘Overnight success story 18 years in the making’

Imricor at forefront in advancing MRI-compatible products for US$8 billion cardiac catheter ablation market
Cardiac ablation a common treatment for cardiac arrhythmia or irregular heartbeat
Imricor will start a US FDA pivotal trial in Q2 CY24 with results expected by end of year

Imricor Medical Systems (ASX:IMR) is at the forefront in advancing MRI-compatible products within the $8 billion cardiac catheter ablation market, aiming to enhance effectiveness and safety for patients and medical staff alike.

IMR vice president of corporate strategy Nick Corkill told Stockhead that cardiac ablation is a common treatment for cardiac arrhythmia or irregular heartbeat, which affects more than 80 million patients globally.

Corkill says the severity of a heart arrhythmia varies. Atrial flutter is the least severe and is the indication the company has regulatory approval for currently.

“Where we will add the most benefit is in more complex arrhythmias like ventricular tachycardia and atrial fibrilation which are also the largest markets by volume for us,” he says.

“A cardiac arrhythmia can seriously impact quality of life and if the atria aren’t draining properly or fully you can get blood clots in the heart that can then cause stroke and even death.

“Cardiac arrhythmia treatment includes medication to try and manage the condition but that doesn’t cure it. A successful ablation can permanently restore the heart to normal rhythm.”

Corkill says a catheter ablation is performed by an electrophysiologist who will make an incision in a patient’s groin and guide a catheter through the vein up to the heart.

“They will use radiofrequency to burn the tissue of the heart to form a lesion that restores the heart to normal rhythm,” he says.

“The procedure is currently done under X-ray guidance, known as X-ray fluoroscopy, and the problem with that is while X-ray is good at showing hard structures like ribs and the catheter itself you can’t visualise soft tissue like the heart.”

Corkill says without visualising the heart’s structure and substrate it’s hard for physicians to know they’ve done the ablation completely in the area which is causing the arrhythmia.

“The patient will go home, the scarring formed can heal and when the swelling goes down the arrythmia may come right back,” he says.

“The long-term first-time success rates can be as low as 50% and patients often require 2-3 procedures to permanently fix the arrhythmia.”

Corkill says using X-ray fluoroscopy also exposes patients and medical staff to radiation throughout the procedure, which can take over four hours for complex cases.

“Doctors are having to wear heavy lead gowns during these procedures to be protected from the radiation and they’re often doing multiples of these in a day which beyond the radiation exposure can also cause orthopaedic problems for the physicians,” he says.

The Imricor Solution

Corkill says there has been a long desire to do cardiac ablations under the superior imaging capabilities of magnetic resonance imaging (MRI).

The physician can see the patient’s unique heart anatomy in real time, can precisely ablate the tissue of the heart where needed, and can confirm in theatre that the procedure was a success while the patient is still sedated and in the scanner.

He says the procedure would take less time, there would be a significantly higher first-time success rates and all in an environment free of ionizing radiation which removes the need for wearing heavy lead gowns and the long-term health risk associated with daily radiation exposure.

IMR is succeeding where many large medical device companies have failed with the patent landscape filled with failed attempts for the design of MRI compatible tools for catheter ablation.

Their equipment – protected by more than 70 patents – looks and feels the same as what physicians currently use for the procedure but are uniquely safe and effective for use inside the strong magnetic fields created by an MRI scanner.

Corkill says there is no competition for MRI compatible ablation devices, and IMR captures 100% of the consumable revenue at each of the iCMR labs (interventional cardiac magnetic imaging lab).

“We aren’t introducing a novel therapy but rather, our focus lies in producing devices that are compatible with MRI technology,” he says.

“The current large players like Medtronic, Johnson & Johnson, Boston Scientific and Abbott make catheters that look and feel just like ours, but they go into an X-ray lab.”

IMR was co-founded by US electrical engineer Steve Wedan who previously worked for GE Medical Systems designing MRI scanners and ultrasounds. He also worked as an industry consultant working in the field of MRI compatibility.

“In the early days of MRI there were patients dying in the scanners who had an implantable in the body, and people didn’t understand why,” Corkill says.

“At that time, through a research project with physicians from John Hopkins University, Steve identified what is now a known hazard for medical devices in MRI.”

The hazard was magnetic fields in MRI scanners, which can cause dangerous interactions in patients with metallic foreign bodies along with device malfunction, such as interference with a pacemaker.

Corkill says as a result standards have changed to protect patients. Wedan has won awards for his work and is a member of various international standards committees in the fields of MRI safety and the compatibility of implanted and interventional products in MRI.

“The physicians at Johns Hopkins asked Steve if he could help them with another MRI compatibility problem they were struggling with – making ablation catheters that could be used in MRI,” Corkill says.

He says Wedan joined that team, came at it from a different approach and essentially formed IMR as a result in 2006.

“We’ve made the only products in the world that are now proven to be safe and effective inside an MRI environment,” he says.

IMR counts Siemens as a 4.5% shareholder, while GE Healthcare are paying the company to integrate with GE MRI systems.

“Together Siemens, Philips and GE represent over 90% of MRI machines sold globally giving us access to almost the entire market,” Corkill says.

“I guess it’s going to be an overnight success story 18 years in the making.

“After a long period of R&D, clinical trials and over US$100m invested, we are now entering the most exciting chapter, commercial scale up.”

Pathway to commercialisation

IMR has received European CE Mark for their capital equipment (one time sale) and consumable catheter (recurring revenue at 70% + gross margin) for the first indication, atrial flutter.

The company has also recently received regulatory approval in Saudi Arabia, Qatar and New Zealand and is in the final stage of TGA approval in Australia.

“We got regulatory approval and started commercialising in Europe in February 2020 but the Covid-19 pandemic hit in March which made it difficult to access hospitals for two to three years,” he says.

“The company lost a fair bit of sales momentum but in the background did all the R&D work necessary to gain access to the entire cardiac ablation market by developing the tools needed to perform the more complex ablations.”

Corkill says there’s a large shift happening in the electrophysiology space where health sites are investing in the gold standard of imaging capability which is MRI to do interventional procedures.

“The promise is to do them faster, with higher first time success rate and all in an environment with zero radiation,” he says.

Upcoming US FDA pivotal trial in 2024

Corkill says IMR has several upcoming catalysts including a US FDA pivotal trial called VISABL-AFL for atrial flutter, due to start in Q2 CY24 as well as its VISABL-VT trial in Europe.

“We have an FDA IDE and IRB approval at John Hopkins where we have now installed our equipment,” he says.

“Patients are being identified and recruited and we’re ready to kick that off soon.”

Corkill says a hospital in Paris and Switzerland have also received ethics approval to join the trial and there’s a potential fourth hospital in The Netherlands.

“We’ll have four hospitals that need to do a total of 91 patients with an interim reading at 76 and if the data looks good there’s a chance we can submit for market approval,” he says.

“We will have this trial started and finished this calendar year and results submitted to the FDA with a six-month review cycle.”

He says FDA approval would unlock the largest healthcare market by volume and revenue in the world for cardiac ablation procedures.

“In the US the reimbursement rate is four times higher than in some European countries, so doctors make a lot more for the procedure and our catheters will achieve a higher average selling price.”

“From here our strategy is simple, we will regain the lost momentum in Europe, enter the Middle East market in the second half of 2024 all the while having trial data coming out of Europe and the US which we think will continue to validate the technology and mobilise the pipeline of hospitals.”

Morgans has a speculative buy and 12-month target price of 96 cents on IMR, which is currently trading at 53.5 cents but has risen 80% in the past year.

“Imricor is a catalyst rich company and well capitalised,” says Morgan’s healthcare analyst Scott Power.