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"You
may print this Interview".
Developing
a laser based breast imaging device that will have a dramatic impact on
testing for breast cancer
Healthcare
Medical Equipment & Supplies
OTC:IMDS
Imaging
Diagnostic System, Inc.
6531
NW 18th Court
Plantation,
FL 33313
www.imds.com
Phone: 954-327-3210
Fax: 954-581-0555
(Contact: Deborah O'Brien)
Richard
J. Grable
Chief Executive Officer
Interview
conducted by
:
Walter Banks
, Co-Publisher
CEOCFOinterviews.com
March
2001
BIO OF
CEO
Richard J.
Grable is Chief Executive Officer and Director of Research &
Development and is the inventor of the CTLMÔ
device. He is considered a
pioneer in the Optical Imaging field with over 25 years experience.
Mr. Grable is a graduate of the University of Miami School of
Business with a Master’s Degree in Business Administration.
He has over 30 years of electronic design experience and has been
directly involved in the development and sales of CT, Nuclear Medicine and
Ultrasound in instrumentation since 1972.
He has over sixteen years of experience of preparing and filing
510(k)’s, Investigation Device Exemptions, and Premarket Notification
documents for the Food and Drug Administration.
He holds two United States Patents and is co-inventor for one other
medical device. He is a
member of the Institute of Electrical & Electronics Engineers, Optical
Society of America, the American Association for the Advancement of
Science, the New York Academy of Science, and a member and guest speaker
of the International Society for Optical Engineering.
Mr. Grable has been a Director and Officer of the Company since its
inception in 1993.
About
Imaging Diagnostic System, Inc.
Imaging
Diagnostic Systems, Inc., has developed the world's first patented
laser-based breast imaging system that utilizes state-of-the-art laser
technology and proprietary and patented algorithms to create
three-dimensional cross sectional images of the breast. The Computed
tomography Laser Mammography, CTLM® is a non-invasive, painless
examination that does not expose the patient to radiation or require
breast compression.
CEOCFOinnterviews
- Mr.Grable, can you give us a little history of Imaging Diagnostic
System, Inc.?
Mr.Grable:
"Our company is a little over 6 year’s old. It is a development
stage company introducing a laser based breast imaging device, designed to
assist in the detection of breast abnormalities that mammography either
can not see or can not do a very good job of identifying as to whether
there is cancer or not."
CEOCFOinterviews
- Where do you see yourself three years from now?
Mr.Grable:
"The mammography market is huge in the United States. We do about
25-26 million mammographies a year and as a result, of that about 800,000
women are diagnosed with suspicious lesions. They then undergo either a
stereotactic biopsy or surgical biopsy and yet, 700,000 of those ladies
find out that they have an absolutely healthy breast, that there is no
abnormality. We spend about 2.4 billion dollars a year just to find normal
tissue, plus all of the anxiety these women go through waiting for the
test results notwithstanding.
Our device is a computerized scanner using a laser to create a three
dimensional image of the breast that helps us to identify which of the
lesions should be biopsied. When a woman has a mammogram and the doctor
says, ‘we are not sure what we are seeing’, then she would have
another test with our device this time, determining if she, indeed needs a
biopsy.”
CEOCFOinterviews
- What advantages are there for your device over the current system of
testing for breast cancer?
Mr.Grable:
"As most women will tell you with traditional mammography the
breast is actually compressed between two plates. One plate is the film
and the other a plastic piece that squeezes the breast with about 25-40
pounds of pressure. It is uncomfortable and sometimes the breast has to be
repositioned. It is not an easy test for many women. The bottom line is
that even if it is the golden standard of today, it is only practical for
older ladies. The young women with dense breasts mammography has
significant limitations because of the density of the tissue. With our
device there is no age limit, tissue density does not matter, we can see
through with the light and there is no ionizing radiation.
There
are many advantages in terms of what technically we can see. Then there is
the comfort index in having the scan done. We see this as two key elements
in this device."
CEOCFOinterviews
- Do you see your device some day replacing what is currently on the
market?
Mr.Grable:
"I think it will have a dramatic impact on the market. One of the
areas that we are also working in is an adaptation device, actually using
a chemical. It is called a fluorescent tag, and it will be specifically
engineered to single out cancer cells in the breast You introduce this
compound into the body, scan the breast and if there is a cancer the
scanner will see it. It will actually fluoresce and give off a signature,
saying this is where the cancer is. That technology is still being
developed, but when it is available, and we are working with
pharmaceutical houses building the cocktail side, it will not only make
finding breast cancer easier, since all that lights up is the cancer, it
will also eliminate the need to have the interpretive film. Right now, the
ability to identify the lesion is very dependent on the skill of the
radiologist who reads the mammogram. With this new technique, that
responsibility goes away. The machine and the compound does that for you.
We are sure that fluorescent imaging will give the traditional mammography
a run for its money."
CEOCFOinterviews
- Are there any health risks involved with your device?
Mr.Grable:
"None whatsoever. One of the first issues that the Food and Drug
Administration wanted us to address was whether the fact that we will be
beaming this laser beam into the breast, would have any harmful side
effects. No one knew because no one has done it before. We spent a couple
of years doing testing and demonstrating that, in fact there is no danger
in using the laser power and the spot size that we use. Not like lasers
employed for burning and cutting in surgery. This is not like that at all.
This is a totally different kind of laser. It is safe."
CEOCFOinterviews
– What are your final hurdles for approval?
Mr.Grable:
"We have been working diligently for the past several months on
approvals. We received the CE marking which allows us to bring the product
into the 18 countries in the European Union. That opens up a huge market
for us. Shortly, we will be in Vienna, at our first International Medical
Exhibition for the product and we are anxious to see the reception we will
get from the European Community there. We have also gone through the
Underwriters' Laboratory safety testing and we have past all their
requirements. Lastly, we are working on submitting our data to the Food
and Drug Administration for our pre-market approval application. We are
using the modular submission approach, which allows you to break up these
otherwise massive documents, into individual modules that you can submit.
They are reviewed individually, which makes the process easier and faster.
We are expecting to have the FDA clearance for domestic marketing sometime
this year."
CEOCFOinterviews
- Are you doing clinical trials with your product?
Mr.Grable:
" We have been in clinical testing now for two years and that is
the information we are using as part of our modular submission database.
So far we had excellent results."
CEOCFOinterviews
- What is your approach in taking your product to the market?
Mr.Grable:
"In the United States there is a major exhibition held yearly the
week after Thanksgiving in Chicago, called The Radiological Society of
North America Meeting. It is a showcase for not only domestic customers
but for the international market as well. We have been exhibiting there
since l994, therefore our company and our product have been introduced to
the physicians of the world. Every year we show them the developments and
advances we have made. This gives us a database of potential purchasers of
this device, who have come back to our booth year after year.
We know where to go with the initial sales efforts. Moreover, we
have other individuals that recognize that being first in the United
States' geographic areas is a big plus for their imaging centers and they
want to be first. Yet, more importantly, we are developing the
relationship with physicians and hospitals that are noteworthy in breast
imaging already. Because if you can establish the fact that the people who
understand breast imaging are, in fact using your device, it is easier for
the other institution to decide to use it as well. Part of our marketing
strategy is to build these alliances and demonstrate to the confirmed
runners of the technology, that it works and that we can satisfy their
need to know that there is applications."
CEOCFOinterviews
- Are you developing your own sales force or will you sell your product
through partnerships?
Mr.Grable:
"Final analysis of whether we partner up with another company, or
how that works out is still to be determined. With the leads we have we
can have our own direct sales force and do a pretty good job of selling
for the first couple of years. However, as the product becomes more mature
and is part of the instrumentation to be sold to imaging departments, it
would make sense to partner up with a big company that has a sales force
and service force and can to get our product out there quickly. We think
that initially, because it is so new, we will try to retain control."
CEOCFOinterviews
- How much money can be made since the market is so huge?
Mr.Grable:
"The device is expected to retail domestically at about 300,000
dollars. Currently there are over 10,000 certified mammography centers in
the United States. We think that the first year a very aggressive
marketing plan would be somewhere between 100-200 units, 30-60 million
dollars in sales. That is not bad for the first year out of the box."
CEOCFOinterviews
– Will your device generate any ongoing revenue stream?"
Mr.Grable:
"The revenues will basically be in terms of upgrades and service
contracts. At the present time there are no consumables or disposables,
however if you move into the fluorescent tag, imaging area, there would be
consumables involved, but that has to be determined."
CEOCFOinterviews
- Who is going to manufacture your device?
Mr.Grable:
"We will basically assembly it, test it and ship it, from our
facility. All the components are made on the outside to our specification.
It is a pretty clean industry, it does not take rocket scientists to do it
and we have the vendors in place who can do the sub-assembly building and
testing for us."
CEOCFOinterviews
- How many facilities will you need to accomplish all of this.
Mr.
Grable:
"We have a 5 acre tract of property here in Florida with 24.000
square foot building already in place, we have plans to add on 18.000
square foot as we need to expand the manufacturing floor space and do some
minimal office expansion for the engineering staff we would need. We have
the ability here to handle the sales needs for at least the domestic and
European market. What will happen in the Pacific rim we do not know. We
very well could establish some kind of relationship over there with
another organization that might perform fabrication where the labor rate
is lower. "
CEOCFOinterviews
- What is your current patent position?
Mr.Grable:
"There are eight patents that have been issued. We believe that
all our patents were issued based on what we have learned in the
development of this product with the exception of two patents, the basic
scanner that I developed back number of years ago. However, the technology
that we had to deal with is not available in the textbooks, we had to
learn for ourselves. This is the first time anyone had used lasers or
light for this kind of imaging. Any
competitors that come along behind us are going to find that we have
explored many of the basic patents of things you absolutely have to do to
make this thing work. In licensing and issues having to do with patents we
are in a very strong position."
CEOCFOinterviews
– Do you have the cash and/or credit to take you to the next level?
Mr.Grable:
"We have just finished negotiations on a 25 million equity loan.
We can draw on that, as we need to. We believe that we can finish the
regulatory process and go into the production phase. We would like to have
cash flow as quick as possible so we can offset the inventory cost with
cash coming in from sales of the product. Do we have enough cash to
overcome the hurdle available to do what we have to do? The answer is
“yes."
CEOCFOinterviews
– What are your closing thoughts to current shareholders and
potential investors?
Mr.Grable:
"It will be interesting to see how the market reacts.
They have to realize that this product is close to becoming a
reality, getting into distribution and raising some cash. We will see what
they think of us. Just the fact that with over the six and half years of
development we have been always pushing toward the final phase in getting
these regulatory approvals. Now, that we have the CE marking and got to
the UL safety testing and are into the FDA process, it sounds like we are
getting to the end of the tunnel" |
