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Health & Biotech
When it comes to global healthcare the US dominates. Morgans healthcare analyst Scott Power told Stockhead the US is the largest healthcare, pharmaceutical and medical device market in the world.
“Usually when we think about it we say the US is 50% of the global market and the beauty of it is that the US is one healthcare system so one set of approvals and it has a reimbursement system which makes it profitable for these companies,” Power said.
“If you compare that with Europe which is made up of many countries, the path to market there is much more fragmented.”
He said companies will get an overall CEO Mark, which is the European approval designation, but then also have to get approvals from different countries within Europe.
“And their reimbursement system varies from country to country,” Power said.
“The US is seen as the largest, most efficient for companies to operate in and therefore that is where they tend to base their business.”
Power said most of the companies that Morgans covers have a dominant part of their business in the US.
So which ASX companies have or are looking to gain a foothold in the largest healthcare market in the world? While that is quite a long list, here’s some that have caught our eye.
M7T on Monday announced it had won participation in the Veterans Health Administration’s National Teleradiology Program (NTP) in the US in a deal which could be worth up to $60 million for the health imaging company.
Under the contract, M7T will provide its VNA and eUnity Enterprise Diagnostic Viewer solutions, which will be integral to the NTP NextGen PACS architecture and will serve as a replacement PACS for VISNs as it transitions off existing contracts.
The NTP is the in-house teleradiology service of Veterans Affairs, providing all radiology service support to VHA facilities.
The program aims to implement a state-of-the-art PACS system designed for teleradiology workflow and reading environment, replacing existing contracts. Mach7’s involvement is as a subcontractor to the prime vendor, Frontier Acquisitions, LLC.
According to Power it’s by far the most significant contract in M7T’s history with key points including:
EYE is tackling two of the biggest diseases leading to blindness in the developed world – glaucoma and macular degeneration – and has a very strong presence in the US.
Headquartered in Adelaide, EYE’s business is 70% in the US market, with the rest in Europe and China.
In late March Nova Eye Medical achieved US FDA clearance for its next generaton iTrack surgical device to treat glaucoma and now the company has officially launched the treatment in the USA.
The iTrack Advance is the new generation canaloplasty device for canal-based glaucoma surgery.
iTrack Advance improves surgical ergonomics without changing method of action, making the canaloplasty procedure more accessible and appealing to the much broader market of cataract and anterior segment surgeons.
EYE managing director Tom Spurling said its previous generation iTrack device was used by about 200 glaucoma surgeons in the US but there are about 1200 glaucoma specialists in total, and on top of that nearly 10,000 cataract and anterior segment surgeons.
IPD recently achieved a key catalyst in the US with its technology becoming standard of care for cancer patients at risk of lymphoedema.
The US National Comprehensive Cancer Network Guidelines were recently updated to recommend bioimpedance spectroscopy (BIS) for all cancer patients at risk of limb lymphoedema.
IPD currently holds the only FDA-cleared BIS technology for the assessment of lymphoedema.
“After years of toil IPD has managed to get into a set of US guidelines which have made their technology standard of care,” Power said.
“The insurers are currently going through a process of updating their medical policy to include the ImpediMed technology.
“Again 95% of their revenue comes out of the US.”
IPD announced last week more than 80% of the insured population in its key US target state of Michigan now have access to reimbursement coverage for its (BIS) SOZO testing for lymphoedema.
IHL is a clinical stage pharmaceutical development company developing medicinal cannabis pharmaceutical products and psychedelic medicine therapies.
Managing director and CEO Joel Latham said the US is an important market for the company which has 28 assets in development following its $125 million acquisition of US-based APIRx Pharmaceuticals USA in 2022.
Incannex now has the world’s largest portfolio of patented medicinal cannabinoid drug formulations and psychedelic treatment protocols.
“We place a significant importance on the US given it’s the largest pharmaceutical market in the world,” he said.
“We focus our attention on developing our assets towards registration and authorisation with the US FDA providing us with the best opportunity to derive the most amount of value for our shareholders and change the lives of millions of patients suffering from the indications we are targeting.”
The MXC Malta production facility has been granted formal EU-Good Manufacturing Practice (GMP) certification.
MXC said the accreditation is the highest standard that a medicinal product manufacturer can achieve to meet in-production processes.
The GMP certification is recognised by the US Food and Drug Administration (FDA), enabling products produced at the facility to be imported for sale in the US.
The medical imaging stock specialises in the early detection of breast cancer. Earlier this year the US FDA finalised a new federal regulation requiring mammography facilities across US to inform patients whether their breasts are composed of dense tissue.
The new regulation will significantly benefit VHT as nearly 40 million mammograms are performed each year in the US, of which its software is used to assess the breast density of more than 6 million annually.
VHT’s proprietary technology, the Volpara TruDensity AI algorithm, has been cleared by the FDA along with other countries.
Under the guidance of new CEO Teri Thomas, VHT has increased the number of larger ‘elephant’ clients, increasing average revenue per account in line with its revised strategy to target higher value, and more profitable products and clients, including in the world’s largest healthcare market.
“Certainly in the past couple of years the number of contract wins and size of the wins has been improving significantly and they’re now at the point where they’re heading very quickly to profitability,” Power said.
At Stockhead, we tell it like it is. While Nova Eye, Incannex Healthcare and MGC Pharmaceuticals are Stockhead advertisers, they did not sponsor this article.
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