iCAD,
Inc. (Nasdaq: ICAD), an industry-leading provider of advanced image
analysis, workflow solutions and radiation therapy for the early
identification and treatment of cancer, today announced the signing of a
definitive agreement to acquire DermEbx™, a leading electronic
brachytherapy services and technology provider, and Radion, Inc., a
cloud-based oncology collaboration software solution. Total
consideration at closing is approximately $12.6 million, consisting of
$3.8 million in cash and 1.2 million shares of iCAD common stock.
The acquired companies are expected to be immediately accretive to
revenues and operating cash flow. The current annual recurring revenue
run-rate for DermEbx and Radion is between $12 to $14 million, with
EBITDA margins greater than 25%. DermEbx and Radion currently service 23
locations with an active backlog of new customers.
The acquisition closed July 15, 2014 and will expand the Company’s Xoft®
Electronic Brachytherapy (eBx®) System® offering
to include all the necessary components to enable dermatologists and
radiation oncologists to develop, launch and expand their electronic
brachytherapy programs for the treatment of non-melanoma skin cancer
(NMSC).
iCAD and DermEbx entered into a strategic alliance in 2013, through
which DermEbx offered the Xoft® System to treat NMSC
throughout its growing customer base of dermatology centers. This
acquisition will expand the Xoft offerings to include physics support,
billing support, assistance with radiation oncology provider selection,
as well as the Radion Hub cloud-based oncology collaboration software
solution. The Radion Hub is a web-based platform that enables centers to
improve patient safety, conduct treatment planning, enhance and monitor
workflow, and improve communication between clinical specialists. The
Radion Hub contains the largest repository of clinical evidence
supporting the use of the Xoft System for NMSC, and is growing daily.
iCAD will become the only electronic brachytherapy company to offer a
comprehensive solution to radiation oncology and dermatology practices
that includes electronic brachytherapy equipment, software, services and
support. iCAD’s acquisition of these two companies is expected to
increase iCAD’s profitability and cash position through enhanced
recurring revenue opportunities driven by the new platform of
comprehensive eBx solutions.
“Since we began our alliance with DermEbx in early 2013, we have
experienced great momentum with the adoption of our eBx technology for
the treatment of non-melanoma skin cancer, which resulted in a record
number of systems placed that year. We are pleased to see this positive
trend continuing well into 2014. The strategic rationale for these
acquisitions is clear and its potential to iCAD and the treatment of
non-melanoma skin cancer is significant as we expand our comprehensive
solution offering to radiation oncology and dermatology practices,” said
Ken Ferry, President and CEO of iCAD, Inc.
For dermatologists who are interested in starting an eBx practice, one
of the biggest barriers has been access to the radiation oncology
services and support necessary to begin treating with this innovative
treatment modality.
“We have been impressed with the total solution and workflow benefits
DermEbx and Radion have provided to their customers. By streamlining
these solutions and services into one seamless offering, we expect to
accelerate market adoption. We are very excited to be enhancing our eBx
offering and strengthening our leadership position in eBx skin radiation
therapy,” added Mr. Ferry.
“We have worked well with iCAD during our partnership, in large part,
because we share a commitment to increasing market access to skin eBx as
an alternative to MOHS surgery for the treatment of non-melanoma skin
cancer,” said Kamal Gogineni, President of DermEbx and Radion, Inc.
“This transaction builds upon our established collaborative foundation
to provide state-of-the-art technology supported by patient-centric
solutions and services through a proprietary oncology solution.”
The Xoft System is a U.S. Food and Drug Administration-cleared and
CE-marked isotope-free radiation treatment approved for use anywhere in
the body, including for the treatment of early-stage breast cancer,
gynecological cancers and NMSC. It utilizes a proprietary miniaturized
x-ray as the radiation source that delivers precise treatment directly
to cancerous areas while sparing healthy tissue and organs. The Xoft
System requires only minimal shielding and therefore does not require
room redesign or construction investment. Minimal shielding also allows
medical personnel to remain in the room with the patient during
treatment. The mobility of the Xoft System makes it easy to treat
patients at multiple locations and to conveniently store the system when
not in use. The Xoft System is the only eBx system with clinical data
published in peer-reviewed journals supporting its use in NMSC patients,
including data that demonstrate excellent cosmesis, low toxicity levels
and no recurrences at three years post-treatment.
Conference Call
iCAD management will host a conference call for investors on Wednesday,
July 16th at 8:30 a.m. Eastern time to discuss this
announcement and answer questions. Shareholders and other interested
parties may participate in the conference call by dialing (855) 217-4501
(domestic) or (716) 220-9431 (international) and entering passcode
74754571. Slides relating to the acquisitions will be posted at 8:00
a.m. Eastern time on July 16, 2014 to the homepage of the Company's
website at www.icadmed.com.
The call also will be broadcast live on the Internet at www.streetevents.com
and www.icadmed.com.
A replay of the conference call will be accessible two hours after its
completion through July 22, 2014 by dialing (855) 859-2056 (domestic) or
(404) 537-3406 (international) and entering passcode 74754571. The call
will also be archived for 90 days at www.streetevents.com
and www.icadmed.com.
About Non-Melanoma Skin Cancer (NMSC)
NMSC, identified as either basal cell carcinoma or squamous cell
carcinoma, is not only the most common type of skin cancer, it is also
the most common type of cancer in humans. These cancers commonly appear
on sun-exposed areas of the body such as the face, ears, neck, lips and
backs of the hands. More than 3.5 million cases of basal and squamous
cell skin cancer are diagnosed in the United States each year.
About DermEbx
Founded in January 2013, DermEbx is a leading healthcare services and
technology company dedicated to offering skin electronic brachytherapy
programs to dermatology and oncology networks. This program includes
collaboration with clinical care teams and management staff in
successfully integrating equipment and software into a patient-centric
workflow model. DermEbx helps its customers with scalability and
operational efficiencies in delivering programs that meet quality and
standards for improving patient care.
About Radion, Inc.
Radion, Inc., founded in 2008, has created products and solutions to
bridge the gaps in cancer patient-care paths so more patients receive
timely, effective, quality treatments. Radion is committed to the
highest quality of care to hospitals and patients, and aligns its
products and services for an end-to-end solution for cancer program
management.
About iCAD, Inc.
iCAD is an industry-leading provider of advanced image analysis,
workflow solutions and radiation therapies for the early identification
and treatment of common cancers. iCAD offers a comprehensive range of
high-performance, upgradeable CAD solutions for mammography and advanced
image analysis and workflow solutions for Magnetic Resonance Imaging,
for breast and prostate cancers and Computed Tomography for colorectal
cancer. iCAD’s Xoft® Axxent® Electronic
Brachytherapy (eBx®) System® offers radiation
treatment for early-stage breast cancer that can be administered in the
form of intraoperative radiation therapy or accelerated partial breast
irradiation. The Xoft System is also cleared for the treatment of
non-melanoma skin cancer and gynecological cancers. For more
information, call 877-iCADnow, or visit www.icadmed.com.
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995
Certain statements contained in this News Release constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements involve a number of known and unknown risks, uncertainties
and other factors which may cause the actual results, performance or
achievements of the Company to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, but are not limited to
the Company’s ability to defend itself in litigation matters, to achieve
business and strategic objectives, the risks of uncertainty of patent
protection, the impact of supply and manufacturing constraints or
difficulties, uncertainty of future sales levels, protection of patents
and other proprietary rights, the impact of supply and manufacturing
constraints or difficulties, product market acceptance, possible
technological obsolescence of products, increased competition,
litigation and/or government regulation, changes in Medicare or other
reimbursement policies, risks relating to our existing and future debt
obligations, competitive factors, the effects of a decline in the
economy or markets served by the Company; and other risks detailed in
the Company’s filings with the Securities and Exchange Commission. The
words “believe”, “demonstrate”, “intend”, “expect”, “estimate”, “will”,
“continue”, “anticipate”, “likely”, “seek”, and similar expressions
identify forward-looking statements. Readers are cautioned not to place
undue reliance on those forward-looking statements, which speak only as
of the date the statement was made. The Company is under no obligation
to provide any updates to any information contained in this release. For
additional disclosure regarding these and other risks faced by iCAD,
please see the disclosure contained in our public filings with the
Securities and Exchange Commission, available on the Investors section
of our website at http://www.icadmed.com
and on the SEC’s website at http://www.sec.gov.
Copyright Business Wire 2014