Victor Windeyer:

Welcome back to Healthy Returns. So I'm your host, Vic Windeyer, and in this episode, I'm joined by Stewart Bartlett, CEO of Ferronova. We'll discuss how the company's working to improve cancer surgery through precision imaging. Now, before we start, just a quick disclaimer, Healthy Returns is an independent initiative that's separate from my role in managing healthcare investment funds at Perennial Partners. So while it aligns with my broader mission to highlight and help entrain the necessary capital to advance potentially life-saving or life-changing healthcare innovations, it isn't affiliated with or representative of perennial partners. And so the views expressed herein are solely my own.

Stewart Bartlett:
So I am an electronic engineer and started in semiconductor design many years ago. Moved into consumer audio and got into the medtech industry about 25 years ago. I co-founded a handheld ultrasound business and that got me into the medtech area. And after I moved on from that, after 12 years, I jumped over to Ferronova and running Ferronova over for about eight years now.

Victor Windeyer:
Yeah, great. Well, it's good that here you're an engineer because the engineers might get happen. Maybe just as a sort of introduction about Ferronova what does it do, how's it going to help patients and where you're up.

Stewart Bartlett:
So Ferronova is essentially an image guide at cancer surgery company. We came out of universities in Australia and New Zealand. They started working with an oesophageal cancer surgeon. Back in about 2010, she was doing a PhD in what's called central lymph node biopsy in oesophageal cancer, which is trying to identify the lymph nodes that have cancer in them. It's a big unmet need. Both oesophageal cancer and stomach cancer, are our two primary indications, are very difficult cancers to treat. If patients are diagnosed early enough, they will have surgery, but surgery tends to either over-treat patients in that they remove the entire esophagus and stomach and up to 100 lymph nodes. Often they don't need to do that or it undertreats them because they miss a lot of lymph nodes and have cancer in them. And as a consequence, the three years survival in Australia after cancer surgery is really poor. It's less than 50% in both cancers and we're trying to resolve that.

Victor Windeyer:
Yeah, OK. So how does it do that precisely?

Stewart Bartlett:
So it's using a technology which is an iron oxide nanoparticle and it gets injected essentially into the primary tumor. It will follow the same pathway that the cancer cells follow and it will go to the lymph nodes that the cancer will metastasize to first. So what you really want to do in surgery to make it curative is to remove those lymph nodes and the primary tumor before it's had a chance to metastasize to the rest of the body when the five years of survival sort of drops to about 8%. So we're identifying those draining lymph nodes. And one of the really complicating factors in these cancers is that most patients have chemotherapy and radiotherapy before surgery. So technology, which works very well in breast cancer, where this sort of method standard of care just does not work. It's a dye and a radioactive isotope. Needs to be injected at the time of surgery. So if patients have chemotherapy before, it has to happen after that. And the chemotherapy damages the lymphatic system. And the pathway that the cancer cells follow, the dye that you inject after chemo, only follows that pathway about 25% of the time. Our technology is an iron oxide particle which is designed to be injected before but remain in those lymph nodes for six months. That enables that injection to be upfront, chemotherapy, chemo, radiation and then surgery and surgeons can still find those nodes.

Victor Windeyer:
Yeah, okay. And so how did I actually go about finding them during surgery?

Stewart Bartlett:
So there's two things that happen to help them do that. So one is that the particles of those lymph nodes are visible on MRI. So before surgery, they've got a plan and they know where those nodes are. And then we make a surgical device, which is a magnetic detector. And so during the operation, they can use that device to make sure that they remove. It is like a little beeping beachcomber.

Victor Windeyer:
Like a Beachcomber.

Stewart Bartlett:
Tend to turn off the beep because it's too annoying. So we just have a number on the screen when they know they've hit the jackpot basically. And that just confirms that they're in the right bit of tissue. They'll then move that bit of tissue. So that's.

Victor Windeyer:
Is it dry adjust to the nearest knife or does it just keep going through the system?

Stewart Bartlett:
So it does drain to the nearest node. Every tracer is going to drain to the nearest node. One of the things that's novel about our technology and is really covering most of our patterns, we have about 28 granted patterns, is that we put a ligand on it that targets receptors in the lymph nodes. So over 90% of the iron oxide nanoparticles are retained in that primary first node we can do the injection, do one scan. One week, two weeks, three weeks after. They can see where those, you know, where those draining nodes are.

Victor Windeyer:
Okay, so where are you up to?

Stewart Bartlett:
So we've used our technology in about 92 patients in clinical trials so far. So we started our first in human trials in about 2020. We did a total of 30 patients in those studies and the technology worked really well. It had 100% accuracy. So you couldn't ask for more on that. There was no safety concerns. So the most recent study, we just completed enrollment of 62 patients. We will be completing the surgeries. There is a delay between injection and surgery of usually up to about three, three or four months. Yeah. And so it shrinks the tumour down. So we have to wait until those patients go through surgery and then they get their pathology so we can finalize all the data, but that should be happening in the next few months. And we hope to publish that data by the middle of this year. So following on from these studies, we'll be moving on to a registration or late this year or early next year, and that will be in Australia and Europe and will be used in our regulatory application.

Victor Windeyer:
Okay, well that's pretty exciting. Australian technology down at global. What's the sort of timeframe for regulatory approval do you think if all goes according to plan?

Stewart Bartlett:
Yeah, it's probably three to four years from now. So it will take us, as I mentioned, late this year, early next year to get the trial running. Enrollment in that study, we're thinking it's going to be about 18 months. It's not a long running study because of the delayed surgery another six months to collect all the data and then we submit those applications. So that's the plan. It's about 125 patients that we need enrolled. So it's not a massive registrational study. And so it should be relatively timely to get those patients enrolled. Okay.

Victor Windeyer:
What's the sort of market potential for this do you think?

Stewart Bartlett:
It's a substantial market. So it's driven really by the cost per patient. So, and what really drives for us, what we can charge per patient is what the overall health economic situation is. And we've had discussions with a number of insurance companies in America. And right now the cost to treat recurrence is really expensive. So after a patient has surgery, if it comes back, then they are effectively a stage four patient and they'll have pretty aggressive and expensive treatment. So what has happened in recent years is new immunotherapies have been approved to treat recurrence and they cost hundreds of thousands of dollars. So the estimate in the US and some studies have shown that it's about US $430,000 to treat a recurrence. So that enables us to have a price point at around $10,000 per dose and still save the overall system money. That insurers don't bat an eyelid. They are very keen to see the real world data and see these $438,000 claims to be reduced.

Victor Windeyer:
Yeah, that's a sort of healthy economic argument. Is there an analogous product you can point to?

Stewart Bartlett:
Probably the closest, but it's not really directly analogous, are the radiopharmaceuticals that are used for diagnostics. They're typically between like US $5,000 and $15,000. And so we're in that price range.

Victor Windeyer:
Okay, very good. Well, thanks very much for joining me today.