Verisante Technology Inc. V.VRS

RE: Mela Needham Conference

[electricsockets]

Hello Folks - It is so important to know your market segment. A good company CEO is not afraid to address competitors in the field with pointed questions. They never talk bad about the competition- they just highlight legiment strenghts and weakness and promote their own business plants.

 If you're interested, here's my personal recap of Gulfo's presentation today, these are only my interpretations:

 

• $35,000 build cost - working extremely hard to lower this with manufacturers. 
• increased the placement fee from $7500 to $10,000 and will continue to do this as demand grows.
• A placement contract with a Derm is for 2 years. The melafind device has an est. useful lifespan of 3 years. Melafind is never owned by a Derm. 
• A warning to investors – revenues for melafind are not immediate - $2k booked asap ~$333.00/month for 24 months thereafter. Majority of placements to date were at $7500. 
• Have 7 full time sales reps in the USA 
• President now in Germany has hired 2 sales rep's. Mela actually revenue shares in Germany in order to gain the most marketshare and eliminate barriers to placement.  $1000/month rent plus 50/50 revenue sharing. 
• Installed a CRM system (customer resource management) and a ERP (enterprise resource planning) 
• Derm's see a questionable pigmented atypical lesions about 1 per hour
• Mela charges $50 per card(patient) and sell a box of 50 at a time. Note: 25 cards are supplied at time of placement.
• In fiscal 2012 – only 4 months at the end was time used to commercialize melafind – they reported over a 100 signed placements. They have about 2.5 months now to reach their goal of 200 signed agreements in the USA and 75 signed agreements in Germany (275 units by end of March'13). 
• two honours received 1) Cleveland Clinic top 10 for 2013 and 2) Fox news top 4 medical hope for 2013. On Doctors, The View, GMA, and many many local news programs.
• RPR has been signed on to build the Melafind Brand name - interesting - they are experts in the derm field, with focus on consumer media, health & beauty mag's  
• Initiated the FDA post-approval study as required by the FDA. 
• 2012 was about turning a company into a business.  2013 is about turning a business into a successful business – by increasing installed base, peer-to-peer medical videos (Derm messaging to potentially new melafind Derms –working on two videos now), and urgently need to reduce manufacturing costs.
• Q1 is a busy month in the Dermatology field with shows and events/meetings (4 total)
• have new patient tear-off sheets given to every derm patient at a melafind location - employing visual scare tactics to entice out of pocket paid scans
• the main future advertising theme will be to challenge people to look at moles - as the reality is most people have several atypical ones 
• Gulfo was touting melafind patients and mm survivors who are independently blogging and publishing material on melafind as a new standard of care. Derm's are sending him praises for catching mm's that they would have missed. 
• very busy 2013 conference schedule for melafind promotion
• there will be a STRONG cosmetic focus on mela advert's. Derm's performing cosmetic procedures on patients will point out lesions of concern and recommend a mela scan (at a cost...wink..wink)
• Melafind process - sticker is applied, trained derm or technician applies oil and places mela gun on lesion for 2-3 seconds, Derm  leaves to see another patient and when he returns (3-5 minutes) a possible result is acheived unless non-evaluable - where process is repeated, if non-evaluable again Derm's call as to whether to biopsy. 

Big Concerns to me occurred during the Q/A session which seemed very very staged and certainly SHORT: 

• Question was asked - how many units need to be placed to achieve positive cash flow - Gulfo: depends on usage -poor answer in my opinion, the repeatedly stated goal is one scan per office per hour - assuming this usage rate ANSWER THE QUESTION….it was clearly avoided. 275 units will not get the company there? 
• Question was asked on competition - Gulfo stated derms eyes, camera's for mole mapping (skimmed over this) and dermascopes -wrongly stated that no other technology to help assist melanoma detection has been approved in their markets and he considers a derms' eyes to be his ONLY competition…hhhmmm - there are actually two BIGGIE'S he avoided - Verisante Aura in Germany(EU) with the forces of LASERWELD distributing -marketing & servicing the device, with FDA expected in 2014 and Caliber I.D.;'s Vivascope using confocal microscopy approved in both the USA and Europe. Vivascope is closer to Melafind being that a dermatologist's eyes are still needed to assess the data output before making a decision to biopsy. The Aura assesses the biochemical spectral signature of a cell – a modality that has been up until this point unavailable for a Dermatologist to see or read or interpret. Potentially the AURA could be used to further compliment any other product on the market today that helps assess morphological features of a lesion eg. ABCDE visual evaluation verses cellular functional behavior. 
• Melafind will need robust literature to prove wide spread efficacy and eventual government reimbursement - this takes years and they do not intend to hurry the process
• company still has remaining ATM stock issuance options as an insurance program of sorts (in case the bank runs dry) in place to raise equity –they report the use or activity of this after each quarter. May need another PP but not at this stage Gulfo states markets have been supportive to this point……

.

Interesting......any thoughts? 

Did I miss anything? 

Again just my personal thoughts and ideas - do your own Due Diligence on any investment. :)