Therefore, taking advantage of MRI's superior imaging capabilities. Just as a reminder to all in the audience, if you have a question you'd like to submit, please feel free to do that using the option within Zoom on your screen, and we'll get to those after the slides. I will hand it over to Nick for the presentation first.
Great. Thanks, Matt. Thanks, everyone, for joining. I know normally you'd sort of get CEOs and founders presenting these stories. I'm hoping to bring a bit of a different perspective. For those who I haven't yet met, my background's been in funds management. I spent 15 years on the buy side, initially as an analyst at Perpetual. I then became a portfolio manager at BlackRock. It was during this time that I came across Imricor when they were doing their IPO in 2019. I thought the technology and the people around it were fascinating. I guess I did six years of forensic DD on this company, including traveling to Germany to go and sit in the hospital, watch some of the procedures using the technology, and speak to the doctors, and really validate it for myself.
I guess I've watched the company continue to make progress over the last few years. It got to the point just over 12 months ago where I've seen enough, and I figured they're about to enter the most exciting chapter, which is the commercialization one, that I wanted to join the team. That's what I did early last year. With that said, I think the best place to start is to explain a little bit about what is the medical condition we are trying to address. We're obviously a U.S.-based medical device company, and we focus on cardiology or cardiovascular disease. The best way to think about cardiovascular disease is to think that cardiologists really split out into plumbers and electricians. The plumbers are obviously dealing with structural heart issues and blocked arteries, et cetera.
We deal with something different, which is the electrical system of the heart. Your heart generates an electrical impulse, and that gets the ventricles and the atria to contract and squeeze blood through the body. Unfortunately, as we get older or have many heart attacks, you get problem cells in the heart that disturb that electrical current, and it can cause the heart to beat irregularly. That's called an arrhythmia. It can beat either too fast, too slow, or just irregularly. When it's not beating properly, there are several risks that start to increase. One being stroke because the heart chambers aren't draining of blood fully, and those clots can then lead to stroke. In the most dangerous cases, like ventricular tachycardia, it can lead to cardiac arrest. It's becoming a bit of a silent epidemic.
It's expected to affect about one in four people by the age of 75. Maybe I'll just shift gears to how they've been dealt with historically. Drugs have been used to try and manage the condition, but that obviously doesn't cure it. Antiarrhythmic drugs and blood thinners. People have had implantable devices put in to shock the heart back into rhythm. What's risen now to be first-line therapy is a procedure called a cardiac ablation. A cardiac ablation is a process by where an electrophysiologist guides a catheter, normally through the groin, up into the heart. With that catheter, they'll try and detect the signals the heart's generating to find where the source of the arrhythmia is. When they find that, they'll deliver energy through that catheter and burn the heart, which sounds a bit barbaric, but excuse me.
Once you form little scars in the heart to destroy those cells, the heart's restored to normal rhythm. The way they've been guiding them is through X-ray. Obviously, here's a picture of the heart during a procedure where you can see the catheters, but you can't see the heart. That's led to disappointing outcomes, 38% effectiveness. The doctor, you can see, is wearing a lead gown, 12 kilos to protect himself from the radiation. That's not really the problem. The problem is what he's looking at is a cloud of nothingness, really. That's why the procedures take so long, and they have to spend a lot more money on the devices to try and make up for the fact they can't see. If we look at our MRI, that is the supreme soft tissue imaging modality, as Matt said.
It's very good for seeing the heart or the organs in the body. The idea dating back to the 1990s was, interestingly, I mean, Imricor's not a technology we've invented trying to find a home in the market. The need actually came from the medical community itself. A group of very well-regarded doctors at Johns Hopkins did all the work to prove that MRI would be the way forward and moving away from X-ray. They worked on that for many years, won a lot of awards at the Heart Rhythm Society. The only thing they couldn't do was make the MRI-compatible devices, which is a very difficult electrical engineering problem. Imricor was really the last to try. These doctors had asked the medical community, all the big players, Boston Scientific, Medtronic, Abbott, et cetera, "Can you make us these catheters?" They all tried.
If you look at the patent landscape, it is full of failed attempts. That is where Steve Wedan came in. He is the founder of Imricor. He just happened to have this unique background where he was a very bright electrical engineer that used to make MRI systems for GE. He also made the first ultrasound systems for use in cardiology. Once he finished that work, he set up his own consulting business and was consulting back to the big pacemaker companies like Boston Scientific, who were Guidant at the time before Guidant got acquired by them. He was making the pacemakers MRI-compatible. The team at Hopkins approached him and said, "Look, you are a U.S.-appointed expert in MRI safety. Can you come and help us on this project?" That is where Imricor was born.
This is what the new modern, what we call iCMR labs look like. The I stands for interventional, and then CMR is cardiac magnetic resonance. What you'll notice is it looks exactly the same, except for the fact that doctors are not wearing lead to protect themselves from radiation. They're next to the patient. The patient's in the MRI. They guide the catheter up through the groin. Now, in real time, they are seeing the soft tissue they are treating, which leads to significant advantages in terms of speed, efficacy, and cost savings for not just the hospital, but also for the insurance companies. Because with such a low success rate, many people have to come back for a second or a third ablation.
We are looking to do the procedure once, check that the therapy has been delivered completely by looking at the lesions that have been created with the real-time MRI imaging, and send the patient home with chronic effectiveness. In fact, our clinical trial we did in Europe showed 100% effectiveness. That is the only clinical trial you'll find on clinicaltrials.gov for an ablation catheter that's had that level of success. Normally, they're around 80%. This is what it looks like in practice. The MRI itself, we don't make. We partner with Siemens, Philips, and GE, who are out in the field talking to hospitals. They also sell the X-ray equipment. They would rather sell an MRI. They make more money upfront and more on the ongoing maintenance of their asset. They plan and build up the lab.
We install all the rest of the equipment and make some money on that along with some third-party partners. What we're really interested in is the consumable revenue. We are the only company in the world that has MRI-compatible consumables, and we capture 100% of the consumable revenue in each of these procedures. This is partly the reason I joined the company because what attracted me to it was this big consumable revenue. Our partners make an upfront one-off sale, and that's great. Obviously, the key value driver is that ongoing recurring revenue nature. That's sort of self-explanatory, but the feedback from the medical community has been very strong to date. This is what it would look like, I guess, to bring it to life for the hospitals.
Currently under X-ray for atrial flutter, which is the first procedure we're doing, they spend about $4,400 on devices. We're doing them for $4,000. There is a marginal saving there, but a savings nonetheless. I obviously mentioned the speed benefits earlier. When it gets really interesting is when you start doing complex ablations, which is what Imricor was really set out to do. They are complex because they're on the left side of the heart. That means the catheter arrives in the right atrium, and then you have to cross the septum, which is the middle wall of the heart. To do that today, often they use an ultrasound catheter, which costs $2,500. That is eliminated with MRI. Once they're then on the left side, because they can't see the heart under X-ray, they use a mapping catheter, which also costs $2,500.
They spend a lot of time mapping around, poking around the heart, trying to get an idea of what the heart looks like from a, and they load that into their software. They try and take micro-voltage readings to understand where is the problem. They go to work and do the ablation. With the MRI, we can see where the problem is. We can cross the septum safely, and we do not have to map out the heart because the MRI gives us all that data instantly or within a few minutes of scanning. Once they start doing procedures in the iCMR lab, the savings really start to add up quite materially per year. The economics for Imricor looks something like this. We expect every hospital to do about 500 procedures per annum.
They are sort of made up of 100 flutters, 100 VT, 300 AFib. That on our average selling price would generate $3 million of recurring revenue per year. The doctors tell us they think they'll do about 700-750, but we sort of bake in some conservatism. Up here, we sort of show the top 50 do 1,600 per year. It's not an aggressive number. It's a very large and growing market. It's estimated to be $10 billion U.S. for the consumables, and that's growing at double digits, led by two things. One, the aging population and the growing incidence of arrhythmia. Also, technology is getting better. Kind of like what we're doing, it's bringing more people in to have the procedure done as opposed to getting an implantable or living on expensive medication with side effects for the rest of their lives.
We are starting to expand globally, having received CE mark approval in Europe and have a number of hospitals starting to commercialize there. We recently made our first sale into the Middle East. The most exciting thing is we're currently well progressed through our FDA process to access the U.S. market, which is about half of that $10 billion. Looking ahead into next year, we've got some very exciting things coming up. The world's first MRI-guided VT procedure is a groundbreaking event that is highly anticipated by the medical community, the industry, and obviously us internally. We won't really be able to make claims in terms of how quick or how effective we are until we start that process, and that's coming in the next few weeks.
What we've shown here is there was a study done in Barcelona where they took a bunch of patients and they scanned them in the MRI the day or the week before. They generated those images and loaded them into the mapping systems the X-ray companies currently use just to help inform the procedure and make it a little bit better. They did everyone else just in the conventional X-ray. You can see the time savings were significant, took two hours off the procedure. In terms of efficacy, it was 82% effective for a substrate-based ablation in the MRI, or sorry, not in the MRI, but with the assistance of that. The X-ray-guided ones were 54% effective. We think that's a half step towards what we are doing. Obviously, you won't have to scan the patient the day before.
You can do it whilst you're in there doing the procedure, and you don't have a stale image. You've got the real heart beating in real time, and you can check your work while you're doing it and after you've done it. We expect to see a further step forward in terms of time savings and efficacy, but we'll release that data throughout the year. What brings it all together is NorthStar, which is the world's only MRI mapping system. The conventional X-ray-based companies, which are the big four, Medtronic, Boston Scientific, Johnson & Johnson, and Abbott, all have a mapping system that requires that mapping catheter to generate the shell of the heart and to show them where the problems are inside the heart in terms of where to deliver the therapy.
NorthStar takes all that image, all the data from the MRI, and generates these images almost instantaneously. We are putting AI into it to identify where are the scars and the channels that you need to go and ablate to cure the arrhythmia. We have some pretty exciting value drivers coming up. In terms of VT, I mentioned that already, that is coming up in the next few weeks. We will be progressively submitting various stages of our FDA process. The first one we expect to get approved is NorthStar, which is obviously a 510(k) pathway, a shorter review cycle, and we expect that to be approved Q3. We will start to generate sales fairly quickly after that.
The rest of the platform, and this is a platform of technology because there are three pieces of capital equipment, a dozen consumables, and the mapping system that's going through a modular review process with the FDA. We submitted our first and largest module late last year or middle of last year and got that approved with no deficiencies. The second module has gone in recently and has been accepted by the FDA. We will continue that process over the next few months and get the entire platform submitted. We also have made our first sale into the Middle East and Qatar, expect to pick up particularly from Saudi, and this is the second half of new sales there. We will continue to expand into that market, which is attractive because the capital budgets are really strong.
They want a modern healthcare system, and this lends itself to that pretty well. We'll continue to adopt new hospitals throughout Europe. The big news will be next year or late this year into next year as we start to commercialize the U.S. market. Obviously, we've just completed an equity raising. This is the slide deck. I don't need to talk about that now unless there's any questions from Matt. I might stop there, Matt, in terms of the prepared slides, and we can go to Q&A.
All right. Thanks very much for that, Nick. Again, just as a reminder to the audience, if you have a question you'd like to submit, just do so using the option within Zoom, and we'll get to those now. Nick, the first one is just with regards to approvals.
I know you touched on it, but there's obviously risk attached to that. Can you just talk us through why there's a level of confidence that those will be successful?
Yeah. Imricor has a long history with the FDA. Back in the day, people were dying in MRI scans, and the FDA didn't know why. If they had an implantable put in, they'd go get their knee scanned, and they'd have a heart attack and die. Steve, who's founded Imricor, identified the fourth known hazard of MRI and helped the FDA sort of write the guidelines, having obviously been appointed as a U.S. expert on safety standards. The guidelines we're adhering to, we sort of have understood them for 20 years, and we've had a long-standing relationship with the FDA.
Not that that gives you preferential treatment, but they know the team to be good scientists, good engineers trying to do something good for the world. They have given us the breakthrough designation in process, albeit not in name. The reason it's not in name is because we don't need reimbursement at the end of it. We've already got that globally because we fit under the existing reimbursement codes. Typically, that's what happens for companies with breakthrough. They get a modular review process. It's more collaborative with the FDA, and there's more back and forth, and you can ask questions. You're better prepared for each module. You get a period of coverage at the end. We don't need that second part. Obviously, there's been a lot of news around staff departure at the FDA.
To date, we've not heard anything from the people we've been communicating with, the reviewers, et cetera. They've communicated they've accepted the second module. It sounds like people have come back to the FDA, but the FDA has not been saying anything in terms of the status of their staffing level. So far, everything's moving through the process quite well. Yeah, we don't have a view one way or the other in terms of if there's going to be any disruption to us specifically.
Very good. And then on the commercialization front, once you've received those approvals, can you just talk to how hard it is to get traction with sales, et cetera?
Yeah, the thing is that this has been a long time coming. This is something the medical community have wanted for a long time.
They were promised it by all the major companies, but no one could make the devices. The need is there. We think the adoption will be fairly quick because everyone wins in this. The electrophysiologist in North America gets paid per procedure. If he can do two or three in a day when he used to only be able to do one, his revenue goes up. The hospital makes all that extra margin from eliminating the devices they have to spend money on today to complete these procedures. The patient obviously has a much better experience having the procedure only once and having a higher efficacy outcome. The insurance companies, as I mentioned earlier, only pay for the procedure once.
The adoption curve, it takes a bit of time to build out the lab and get them ready if it's going to be a brand new one. A lot of hospitals and cardiology departments already have an MRI in them. Steve would tell you that when he first made the ultrasound for cardiology, no cardiologist had one. All the imaging modalities were sitting in radiology: X-ray, CT, MRI, and ultrasound. Now you will not find a cardiologist that doesn't have an ultrasound system. The same thing is happening with MRI. They're pulling it into their practice for diagnostic purposes and now for interventional purposes. With this asset, they can do interventional procedures, which are high revenue generating. When they're not doing procedures, they can use it 24/7 for diagnostics revenue generation. That's something the X-ray system cannot do.
It's different to the X-ray you'd go for a broken arm or leg. It's a specific machine for doing these procedures. The other thing, sorry, Matt, I'll mention is having the muscle of GE, Siemens, and Philips behind us, that their sales team are out there visiting these hospitals and getting into their capital budgets ahead of time, knowing that the X-ray machines burn out every 7-10 years. There's an ongoing replacement cycle happening every year where about 10% of the market is coming up for renewal, and we slide into that and try and pick up that replacement cycle.
Thank you. Obviously, company-based in the U.S. and being listed on the ASX, some will find that slightly unusual. Not so much these days, but as a company, you're considered dual listing or anything of that ilk?
Not at the moment. We're very happy listed here.
The way it came about was the ASX did a roadshow through Minneapolis just when Imricor proved that they could do this. The company was looking to raise more significant capital given the wave of the influx of demand they got from positions. It was either VC, Nasdaq was challenging given the size and stage of the company. The ASX made sense, and that's what they've listed. We've got a great shareholder base here that we're very loyal to. Yeah, we're not about to pick up stumps and go to the Nasdaq. We're very happy here.
You alluded to it at the end there, and we won't talk on specifics of the raising because I think there's an announcement pending. Can you just talk to the sort of reaction you've had?
It must be pleasing to see such strong interest in the company after a lot of work from the team.
Yeah. Following the pandemic, interest rates went up. Everyone went up the liquidity curve. It was very tough to raise capital. We have sort of fixed the balance sheet, started to rebuild the register. We have got a really solid register, and that has taken another leg up now following the raise we will announce the outcome of this morning. We went out to raise $ 70 million at no discount, and we got extremely good support for that in a tough market. I think it shows the understanding from the investment community of how big this market is, how unique this technology is, the moat around the business, and as we start to scale up, how big the sort of company we are planning to build can be.
Excellent.
You've touched on it a bit through the presentation, but can you just talk about with that money coming in, how does that, what does that allow you to execute upon?
Yeah. That's funding us for several years into the future. Our previous glide path was to do atrial flutter in the U.S. and get hospitals doing that. If you think about getting 100 hospitals doing just Flutter, that would generate $40 million recurring revenue. Then you layer in the other indications of VT and AFib, and that goes to $150 million. We're going to bring those online into the future. With this capital, if we can then do those trials concurrently as opposed to sequentially, we just pull forward that revenue into earlier years. That's part of it.
The rest is building out our sales team in Europe and the U.S., getting ready for the launch. It is not that we are going to really step up our spend. We will put a bit more investment into the key areas of sales and marketing, product development, and regulatory compliance. It just really extends the runway so we can focus and execute as opposed to worrying about capital markets for a long period.
Very good. That is all we have time for for now, Nick. Thanks very much for your time today and to those who have joined the session and congrats on the outcome of the raise, which everyone should go and read about shortly.
Thanks for your time. Thanks, everyone.
Thanks again to those in the audience. Next up, we have CurveBeam AI, which will kick off from 9:40 A.M. Eastern Time. Thanks again.