Pacific Edge Limited is a global cancer diagnostic company, based in Dunedin, New Zealand, specialising in the discovery and commercialisation of diagnostic and prognostic tests for better detection and management of cancer.
Its Cxbladder suite of non-invasive, simple to use, and accurate diagnostic tests provide actionable results and better detection and management of urothelial cancer. The company is developing and commercialising its suite of four proprietary Cxbladder products for better detection and management of patients presenting for evaluation of bladder cancer or monitoring for recurrence. These non-invasive molecular tests utilize a urine sample from patients and are offered in the Company’s targeted markets of New Zealand, Australia, Singapore ( SEA), and the United States, through its wholly owned central laboratories in New Zealand and the United States. The company’s products have been tested and validated in a number of international multi-centre clinical studies to provide the necessary clinical evidence to support widespread adoption by healthcare providers and reimbursement by healthcare payers.
In May 2021, the company reported accelerating revenue growth in its key markets, following the achievement of several key commercial milestones in FY21, despite the ongoing challenges and headwinds of COVID-19 throughout the year.
Commercial success and reimbursement for healthcare and medical technology products and services require the extensive development of peer-reviewed published clinical evidence. The Company’s Cxbladder clinical evidence has been a big part of our investment for many years and this evidence underpins our commercial success. Over the last 12 months, we have seen the conclusion of long periods of due diligence and evaluation of our Cxbladder evidence by several large healthcare providers and payers in the USA where the extent of any evaluation period is often synonymous with the disruptive nature of our Cxbladder products.
Pacific Edge announced two major commercial milestones in June 2020 and July 2020. Firstly, Kaiser Permanente, the largest not-for-profit integrated healthcare provider and payer in the USA, concluded with the Company a nationwide agreement for the commercial use of all Cxbladder products, starting with the use of Cxbladder Monitor. Kaiser Permanente has more than 12.8 million lives under coverage, roughly 2.5 times the size of New Zealand’s population. Secondly, The Centres for Medicare and Medicaid Services (CMS) concluded their due diligence of the Cxbladder clinical evidence and announced that Cxbladder Detect and Cxbladder Monitor were now covered. The CMS provides healthcare insurance for all US citizens over the age of 65 years, roughly 62 million people.
The successful achievement of these two major commercial milestones substantially de-risked the Company and resulted in strong share price and reported revenue growth in the FY21 financial year. The strong share price growth also resulted in Pacific Edge being added to the S&P/NZX 50 Index in October 2020.
The COVID-19 pandemic has highlighted the need for novel ways to detect cancer early and guide treatment for patients. As a result, we are now seeing a secular shift in the increased role of using telehealth to increase diagnostic utilization and patient convenience that has been supported by the FDA and the CMS in the USA.
In line with this growing trend, in-home diagnostic testing for cancer is also expected to become an accepted option for patients and physicians, both during the COVID-19 pandemic and beyond. A leading US healthcare provider recently stated that their use of tele-consultations increased from 15% of all appointments pre-COVID-19 to 80% currently.
Cxbladder’s patient in-home urine sample collection system (PIHSS) is an enabler of telehealth and is now being used to enable telehealth in both New Zealand and the USA. The Cxbladder in-home urine sample collection process incorporates the delivery of Cxbladder’s sample collection kits direct to patient’s homes, and then collection and delivery to our laboratories in New Zealand and the USA for analysis. Cxbladder in-home sampling enables physicians to maintain timely evaluation and diagnosis of bladder cancer and manage at-risk patients remotely.
As a result, we are now seeing growing recognition of the benefits of the Cxbladder in-home sampling solution as evidenced by three DHB’s in New Zealand commencing use of Cxbladder’s in-home sample collection and our recent commercial agreement with Kaiser Permanente. We expect demand for Cxbladder’s in-home sample collection to continue to grow as urologists constantly search for better ways to manage their bladder cancer patients beyond Covid-19 as demand for telehealth services continues to grow around the world.
In addition, the $22m investment from ANZ NZ Investments in July 2020 significantly strengthened the Company’s Balance Sheet and provided the necessary growth capital to accelerate investment in our global sales and marketing capabilities. This additional growth capital ensured that we had the necessary resource in place to successfully execute on the significant growth opportunities our suite of Cxbladder products has in our targeted markets around the world, both during the COVID-19 pandemic and beyond.
Pacific Edge has a strong culture of innovation, a can-do-attitude and a closeness that comes from a team that has endured over many years. Both the US and New Zealand teams were classified as essential workers during the Covid-19 lockdowns and our laboratory staff in NZ and the USA continued to provide a full service to our customers throughout the pandemic The NZ science team converted spare lab space to enable Covid19 testing and we offered up our services to help the Ministry of Health.
It was fantastic to see all our staff rise to the challenges provided by the pandemic, which reflects our strong culture of innovation and a can-do-attitude.
Throughout the Covid challenges we have been fortunate to keep all of our staff and to continue to grow. It is always a challenge to recruit the talented people that we need, however the opportunity to live and work in the cultural capital of the South Island is a very compelling selling point for the Company. We have recruited a further 9 sales executives in the USA, increasing from 16 in mid-2020 to 24 at the end of Q1 of this financial year.
Our expectation over the next year is to further increase the size of our USA based sales team to 28. The company’s strong growth and successful trajectory have been very helpful in our recruitment success. We have also recently recruited a new CIO and COO and made an internal appointment to a newly established CTO role to help us execute our global growth strategy.
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