The partnerships consolidate Volpara’s position as a leading player in the US$3.75bn market for lung cancer screening technology.

Since 2019, healthcare technology company Volpara (ASX:VHT) has been focused on complementing its core integrated breast care platform by building out a leading market position in lung cancer screening.

And so far in September, the company has provided two important updates for investors that help solidify its position in the US market for lung cancer detection & diagnosis products, which it believes could reach US$750M of annual recurring revenue as lung cancer screening ramps up globally.

This morning, the company confirmed the expansion of its US market footprint via a strategic partnership with lung AI company, Reveal-Dx.



Based in Seattle, Reveal-Dx is developing its core product, RevealAI-Lung – a platform focused on leveraging technology and AI to optimise decision support software used in lung cancer assessment, in turn contributing to the optimal clinical pathway for each patient.

Reveal-Dx has received CE-Mark approval from European regulators, and is working towards similar approvals from the US FDA and the TGA.

The company has also received patent protection for its technology, and was recently rebranded and recapitalised by successful medtech entrepreneur Chris Wood.

The RevealAI-Lung platform integrates with existing PACS (picture archiving and communication systems) and deploys its technology to score nodules found in lung CT scans, which in turn informs better clinical decision making.


Strategic rationale

Volpara’s investment in Reveal-Dx marks an extension of its existing market footprint in lung screening, which it established with its acquisition of MRS Systems in June 2019.

“Since then, the benefits of lung cancer screening using low dose computed tomography (CT) have become more widely accepted globally,” Volpara CEO Ralph Highnam said.

However, while the benefits of screening have been established, the screening process  still has limitations.

Most notably,  the “number of false positive nodules which are found is high, not just in routine screening but incidentally whilst scanning for other diseases such as pneumonia”, Highnam said.

“That differentiation of nodules is exactly what Reveal-Dx has been focusing on and we look forward to working closely with them to bring that technology to market as part of a more integrated lung cancer screening platform.”

Early clinical data for RevealAI-Lung indicates that many cancers can be detected earlier using AI nodule analysis, rather than waiting for a repeat scan. The technology also has the capacity to reduce ‘false positive’ tests.

Based on that data, and the way screening is ramping up globally, RevealDX has assessed the total available  market for the AI Lung platform  as up to  US$750m in recurring revenue, with a core target market of payers and providers initially, before seeking reimbursement in the US.


Deal structure

Under the terms of the deal, Volpara will invest US$250,000 via a convertible note to fund the development of the RevealAI-Lung technology.

Reveal-Dx will deploy the funds to pursue additional regulatory clearance in the US and Australian markets, and publish two key research studies.

Volpara will also get exclusive rights to license and sell the RevealAI-Lung product in Australia and New Zealand, with non-exclusive sales rights in the US market.

“This is a pivotal moment for lung cancer screening globally, and our involvement in it – the combination of Reveal-Dx and Volpara will be as compelling in lung as Volpara is in breast today,” Highnam said.


Riverain Technologies

Volpara’s deal with Reveal-Dx follows on from another important update last week, when the company signed a collaboration agreement with leading US-based lung imaging company Riverain Technologies.

The agreement will see the two work together to integrate Riverain’s own AI-based lung nodule detection system, ClearRead, into the Volpara Lung platform.

Both deals complement VHT’s strategic vision for the Volpara Lung platform – a software solution that reports, tracks, and provides standardised risk assessment procedures for lung cancer screening that enables patient management from scheduling to diagnosis.

The ClearRead system offers smart AI tools to assist in the early, efficient detection of lung nodules.

ClearRead applications are approved for concurrent reading which saves radiologists time, and the product suite “significantly improves a clinician’s ability to accurately detect disease using patented vessel (CT) and bone (x-ray) suppression technology in thoracic images—for earlier, more efficient detection of lung abnormalities”, Volpara said.

In combination with Volpara’s integrated lung screening platform, the technology will assist the ability of Volpara’s software to help clinicians “efficiently detect lung nodules and track patients throughout the screening and diagnostic process”, the company said.

Taken in aggregate, Volpara’s partnership approach is setting the company up for success as it fosters improvements in screening practices for lung cancer, which causes around 130,000 deaths in the US each year.

Around 15 million people in the US alone are now eligible for lung cancer screening, in line with the ongoing global growth of more effective screening programs.

At an approximate cost of US$250 per scan, the payers in the US will be looking towards paying US$3.7bn annually just for the screening component, and then much more in dealing with the false positives.

This article was developed in collaboration with Volpara, a Stockhead advertiser at the time of publishing. 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.