Key Offer Terms:
Offer type $8.0 million* (or 32.0 million newly issued shares)
Pricing $0.25 per share
Shares on issue post IPO 198,615,633
Market Cap at Offer price $49.7 million
Implied Enterprise Valuation $41.7m (post-money)
What is BCAL Diagnostics?
BCAL is developing a non-invasive, low-cost, blood-based diagnostic test to detect breast cancer for every woman, everywhere. BCAL’s test seeks to complement the “gold standard” for breast cancer detection, the mammogram (an x-ray of breasts). Mammograms can be painful, difficult to access with varying levels of accuracy; hence >50% of women self-exclude from testing.
Why we like BCAL?
High Efficacy. As a diagnostic tool that ultimately seeks to be available for all women, initial studies indicate the BCAL test has 91% specificity and 87% accuracy for invasive ductal carcinoma (IDC) breast cancer. This compares favourably with the current standard, mammography, which has historically been more effective as a breast cancer diagnostic tool for older women with less dense breasts.
Path to Large Market. BCAL has defined a clinical pathway to access large target markets; initially targeting Australia, the USA and Europe. Globally, there are more than 2 million new cases of breast cancer diagnosed annually, with ~627,000 resulting deaths. The demand for breast cancer diagnostics was valued at just under US$5 billion in 2019.
Quality Clinical Evidence. Through various cohort studies to date, BCAL’s research has been validated in Australia and by working with the Company’s partners in the USA. BCAL’s close work with leading breast surgeons has translated into support for BCAL’s upcoming clinical studies at Royal Prince Alfred Hospital (Sydney), NSW BreastScreen, and Chris O’Brien Lifehouse.
GenesisCare Partnership. BCAL recently engaged GenesisCare to act as a Clinical Research Organisation (CRO) for BCAL through its clinical trials program. GenesisCare has ~5,000 healthcare professionals and support staff across Australia, the UK, Spain, China and the USA, designing treatments and care for people with cancer and heart disease.
Adjunct Test to Gold Standard. The BCAL test will initially be an adjunct to traditional mammography, seeking to provide physicians with an increase in the sensitivity of breast cancer detection.
Opens New Markets. Using a strategically sequenced roll-out strategy, the BCAL test will seek to open new approaches to breast cancer screening, including women:
under 40, who currently rely on self-examination as primary screening;
who have previously been diagnosed with breast cancer and require annual screening, and those with the BRCA1 and BRCA2 gene mutation; and
who self-exclude for religious or other reasons, noting that mammograms can be painful procedures which often lead to self-exclusion.
Platform to Other Cancer Diagnostics. BCAL’s platform technology, if successful, will also provide future expansion opportunities into other indications, for example, prostate and lung cancer.
Strong IP Portfolio. BCAL has existing intellectual property protections and is focused on broadening that portfolio as the technology is further developed.
Experienced Board. BCAL has a strong and experienced Board and senior management team; as well as a team of experienced technical and commercialisation advisors to support the technology’s ongoing development.
IPO Offer Metrics & Use of Funds:
Broker Firm offer to raise $8 million in IPO funding at a pre-money valuation of $40 million. Offer to issue 32,000,000 new shares at an offer price of $0.25 per share
Funds raised will be used to build out the management team, fund further validation studies (leading to regulatory approvals), enhance the test for scalability & ease of use and for working capital purposes
Valuations vs Peer ASX-listed Diagnostic / Breast Imagining Companies:
IPO market capitalisation (post-money) of $49.7m attractive versus listed peers:
Breast Imaging Analytics: Volpara Health (VHT - $315m)
Board Members: Jayne Shaw Executive Chair Co-owned Sydney Breast Clinics (sold to Healthscope); Co-founder Vision Group; Board Citadel Group. Corum Group & Mabel Technologies; Boards Cardiology, Orthopaedics and Women’s Health
The Hon. Ron Phillips AO Non-Executive Director Co-owned Sydney Breast Clinics (sold to Healthscope); Health & Aged Care consulting; Deputy Leader of NSW Opposition (15 years NSW Parliament)
Jonathan Trollip Independent NonExecutive Director Boards Global Value Fund, Future Generation Investment Co., Antipodes Global Investment Co., Plato Income Maximiser, Propel Funerals, Kore Potash; former Freehills Partner
Mark Burrows AO Independent NonExecutive Director CSFB banking veteran; formerly Barings Brothers Burrows & Co., ING Barings, Lazard; multiple past ASX20 Chair / Deputy Chair roles (Brambles, Fairfax, Telstra); UN, G20 & Australian Federal Government advisor
Dr Merilyn Sleigh Independent NonExecutive Director Boards of EvoGenics, Clover Corp, Tyrian Diagnostics, AdAlta, Peptech; Senior Manager CSIRO
Use of Funds (IPO funds):
Use of Funds / Expenditure Program Year 1 (A$m) Year 2 (A$m) % of Funds
Clinical development 1.50 1.90 42.5%
Intellectual property management 0.40 0.60 12.5%
Algorythm development and validation 0.20 0.10 3.8%
Working Regulatory management 0.25 0.25 6.2%
Working capital 1.00 1.00 25%
Expenses of the Offer 0.80 - 10.0%
Total funds allocated 4.15 3.85 100%
EB – NZ$808m)
