The US Food and Drug Administration (FDA) has given the green light to respiratory imaging technology company 4DMedical (ASX: 4DX) for its CT-based lung ventilation analysis product (CT LVAS™). This FDA clearance will allow 4DMedical to leverage the US’s available CT hardware and boost its presence in the region.
The FDA clearance follows the rollout of CT LVAS in Australia in October 2022, which was chosen as the Company’s first market due to its high density of CT scanners per head of population.
In 2020, 4D Medical’s XV LVAS product received FDA approval. The CT LVAS is not too different from the XV LVAS in that it produces identical ventilation deficiency reports. But, unlike the XV, which emphasises X-ray tech, the CT LVAS utilises the widely available Computed Tomography (CT) imaging infrastructure (instead of X-ray equipment).
4DMedical MD/CEO and Founder, Andreas Fouras, said, “I am excited by this progress in our commercialisation and the impact that FDA clearance for CT LVAS™ will provide caregivers and patients. As we head to [the] RSNA (Radiological Society of North America), I am thrilled that reimbursement has been approved for our XV LVAS® product and to now also share that we have clearance for CT LVAS™ in the U.S, which, both in their own rights, create material impetus for doctors and patients to adopt our technology. The clearance for CT LVAS™ offers further validation of our development and represents significant progress towards commercial release of our CT:VQ technology.”
With plenty to unpack in that statement, let’s start with the reimbursement. On November 13, the Company announced that the U.S. Centres for Medicare and Medicaid Services (CMS) approved reimbursement for 4DMedical’s XV LVAS at US$299 ($459.65) per procedure from January 1, 2024. This means that people can bill their XV LVAS procedures to Medicare, the national health insurer in the US, thus accelerating the uptake for XV LVAS.
Having gotten the FDA clearance for CT LVAS, the Company will adopt a similar reimbursement strategy by first applying to the American Medical Association (AMA) to establish a new, distinct, Category III CPT (current procedural terminology) code to identify the use of CT LVAS amongst healthcare providers and payers, and then seek to have the procedure reimbursed by public and private health insurance schemes.
Now for its CT:VQ technology—in May, 4D Medical shared initial clinical results for its CT-based ventilation-perfusion product, CT:VQ. This technology allows quantitative data on blood flow (perfusion) to be obtained from non-contrast CT (i.e. not involving needles or inhaling chemicals) scans taken during both inhalation and exhalation. This data is then combined with ventilation information from CT LVAS. The CT:VQ product is especially useful in assessing acute pulmonary embolism (PE) (blockage of a lung artery).
Finally, the FDA clearance for CT LVAS comes as the Company prepares to display its tech at the world’s largest Radiology congress, RSNA (Radiological Society of North America), in Chicago.
MD, consultant radiologist at 4DMedical and a practising clinical radiologist, Dr Greg Mogel, said, “Having access to CT LVAS™ as an FDA-cleared product will provide my U.S. radiology colleagues immense value for their referring clinicians needing answers in chest CTs, and I can’t wait to share this release at the upcoming RSNA.”
Per OECD, the US install base for CT scanners is material, with 43 CT scanners per million population (versus Australia at 70, France at 20, and Canada at 15 per million), and will therefore significantly broaden the accessibility of functional lung imaging for people in the US living with lung disease. This makes the US an attractive market for 4DMedical.
The Company ended FY23 with $69.6 million in cash as it locked in major US contracts, including the Department of Defence and Veteran Affairs. Its cash receipts from customers were $2.2 million, up 413% on FY22.
Alinda is a Business Reporter for The Sentiment
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