Item from The Post (17 May 2025) TruScreen screening tech starts...

Item from The Post (17 May 2025)

TruScreen screening tech starts to catch hold across China

• The Post
• 17 May 2025
• Alka Prasad

APTruScreenhas spent the last eight years cracking into the Chinese market which chiefexecutive Martin Dillon says has done the legwork to enter even more markets.

A slowgrind into China, a landmark study and a new deal in India have laid thefoundation for med-tech firm TruScreen to finally make a profit after manyyears of operating, its chief executive says.

But arecent market update says that won’t be this year.

The NZX andASX-listed company was established in Auckland in 2013 to commercialise ahandheld device that used low-level electrical and optical signals to detectcancerous and pre-cancerous tissues in the cervix.

Anyone frommidwives to laypeople can be trained to use the AI-enabled device, which isaimed at low to middle-income countries with a high need for cervical cancerscreening but lacking in medical infrastructure.

As well asselling the devices, the company also sells single-use sensors (SUS) for eachpatient screened, setting up a recurring revenue model.

The needfor such technology is clear, with millions of women around the worldessentially untested for cervical cancer in the way New Zealand women, forexample, routinely are from a certain age. But various difficulties breakinginto the markets this company operates in, its small size, and the ever-presentneed for shareholder support and funding have made it a hard slog.

Now,however, the company says breaking through in China has been a game-changer,even while chief executive Martin Dillon said there was nothing easy about it.

Dillon saidprospects started popping after the Chinese Obstetricians and GynaecologistsAssociation (COGA) ran a threeyear research project of 15,500 patients on theefficacy of TruScreen compared with traditional screening tests, showing thedevice’s worth as a primary screening tool.

“It's taken5½ years in China to start becoming profitable,” Dillon told ThePost.

It didn’tmean the company overall was profitable yet. Dillon could not confirm when itwould start making a profit.

It’sgeneral direction appears positive. In a February 2025 presentation shared tothe NZX, the company had a market cap of $19.34m (from $10m a year ago),revenue had gained by 18% and losses had continued to decrease, from $7.9m inthe 2022 financial year to $2m in the current year.

TruScreenadvised the market in March that the 2025 year would see an “improved loss”.

CrackingChina

One of thereasons the all-important China market had taken a while to flower was down tothe disruption caused by Covid.

The COGAproject went from 2018 to 2021, concluding TruScreen devices minimised the needfor training and facilities, offered real-time results and was appropriate as aprimary screening tool in regions with high morbidity and mortality to cervicalcancer.

But theonset of the pandemic meant there was “a complete freeze” for the business from2020. Sales across the company in 2021 were down 31% on the previous year to$1.3m due to Chinese procurement delays and pandemic lockdowns.

That year,Truscreen dual-listed on the ASX and raised $1.9m for device manufacturing inChina to meet local regulatory requirements. The company started manufacturingChinese-approved devices in May 2021 at a facility in Shenzhen.

COGA’sstudy was published in the European Journal of Obstetrics & Gynecology andReproductive Biology in 2021, which drove the likes of the World HealthOrganisation (WHO) and Chinese regulators to give the technology the greenlight and add the devices to its approved screening guidelines.

“That tellsthe world that a major study has validated all the minor trials we’ve donepreviously… each country now will be quicker to commercialise,” Dillon said.

Combinedwith the waning pandemic, the study led to sales growth in China, from $1.14min 2023, swinging up to $1.65m in 2024.

Distributorskey

Aside fromspending eight years - minus two “lost” to Covid - tackling China’s publichealthcare system, getting the devices into usage, and finding a medicaldistributor with the right connections was an issue in China as in othermarkets.

Distributorsare key connectors of medtech companies with potential buyers, or hospitals.

But inChina, the COGA study meant those buyers were willing to invest in TruScreenover local competitors including an array of Chinese companies conductingliquid-based cytology and HPV tests.

That wasbecause TruScreen tests didn’t require lab infrastructure or staff whichallowed that revenue to stay within a hospital, making it a cost-effectiveprocurement, Dillon said.

It alsoprovided immediate cervical scan results for women in remote areas who couldn’tget to the hospital for a follow up appointment.

He saidhospitals opted to procure TruScreen, even though a test cost customers aroundthe same amount as a traditional lab-based cervical test.

In someprovinces, TruScreen costs could be reimbursed to patients through the publichealth system.

It was nowstarting to crack China’s private health care market after rollouts across 11provincial public hospitals since 2017, including Hunan, Jiangsu and Guangxi.New buyers included “luxury hospitals” in Guangdong, and smaller health clinicsand traditional medicine providers, which were likely to bring bigger returnsfor the company,

‘Opportunistic’growth

The effortto crack China paid off for TruScreen’s other potential markets.

The companyhad got a boost into markets like Zimbabwe, Mexico and Uzbekistan as a resultof the study, with the health ministries of these countries seeking to carryout high-volume cervical screening at as low as possible a cost.

Regulatoryapproval could be difficult: a $300,000 contract in Zimbabwe to screen 14,000women in the Masvingo province was stalled due to administration delays - butincreasingly TruScreen is looking to be approached by those wanting to set uppublic health programmes, which means more impetus for the countries themselvesto expedite approvals.

That meantrevenue generation in those markets would also be delayed.

TruScreennow had its eyes set on India, partnering with Indian medical distributorRenovate Biologicals last month to tackle India’s small but growing cervicalscreening market.

“When wewent into China, we had no major clinical trials … Now when we go into India,we have a background of clinical trials,” he said. “That support is helping toincrease adoption in the medical community.”

In 2023,the Indian Government announced plans to screen 70% of the female population by2030, meaning an expansion of screening outside the country’s privatehealthcare sector, which currently did most screening.

Dillon saidIndia’s high-volume screening market could provide major revenue opportunities.

“If wescreen 1% of the current [Indian] market, that would give us half of what wecurrently do in China, which is 78% of our current sales,” he said.

Was thatenough to make the company profitable, finally?

Dillon saidhis “faith in the business and technology” told him that new markets would becommercialised more quickly based on the slow burn of business in China overthe last seven years.

Thecompany’s full-year results are expected to be announced in the next fewmonths.