Trading Statement

RNS Number : 5177K

Deltex Medical Group PLC

18 July 2011

 



Deltex Medical Group plc

Pre-close trading update on the six months ended 30 June 2011

18 July 2011 - Deltex Medical Group plc ("Deltex Medical" or the "Company"), the global leader in oesophageal Doppler monitoring ("ODM"), today announces an update on its development and trading performance for the six months ended 30 June 2011.

Throughout the first half of 2011 the Company made significant progress towards its goal of establishing the use of the CardioQ-ODMÔsystem as a standard of care in the management of patients undergoing major surgery. Continuing and strengthening growth in the UK from increased adoption of the CardioQ-ODM generated in excess of £400,000 in additional revenue, which was partly offset by a reduction in sales of monitors to the Middle-East. Overall sales increased to over £3.0 million (six months ended 30 June 2010: £2.9 million). A refocusing of export sales resources into more politically stable regions is already beginning to yield an improving trend in export markets.

On 30 March 2011 the National Institute for Health and Clinical Excellence (NICE) published guidance to the NHS in England recommending CardioQ-ODM be considered for use in almost all major and high risk surgery. This guidance, added to considerable pre-existing momentum, has positioned the Company strongly in the UK: at the same time the importance of the NHS more rapidly adopting proven new medical technologies has been recognised not just within the UK Government's health policy but also in its plan for growth for the UK. The key metric for the Company's success in the UK is the rate of growth in surgical probe sales and this has increased since the NICE recommendation.

In the USA, clinical awareness of the importance of optimising vascular fluids is growing but remains some way behind the UK and Continental Europe. Our strategy is to develop broad and deep adoption of CardioQ-ODM in influential hospitals where such awareness is more advanced as a base for future expansion and during the period we have made substantial progress in a number of our target accounts. Generating success stories of the benefits to patients from implementing CardioQ-ODM is critical to future expansion and we expect the first results from implementing CardioQ-ODM in surgery to be made public during the second half of the year.

As a result of uncertainties caused by political unrest in the Middle-East we have redeployed some of our resources into other potential markets with developed healthcare systems, including Scandanavia, Canada and Australia. Progress in these markets should enable us to replace these less predictable sales with more regular sales of probes. Today we have announced an important implementation project by a hospital system in Canada and further similar projects are under discussion in a number of territories. In France, where our distributor was awarded a tender to supply the Paris hospital systems late in 2010, we have been encouraged by the evolving response from clinical leaders and a recent increase in the monthly probe standing order from our distributor.

Nigel Keen, Deltex Medical's Chairman, commented:

"Our business entered a new phase in its development during the first half of 2011 and we enter the second half with considerable confidence. Our UK growth rates are strong and show encouraging signs of acceleration. In the USA we expect shortly to be able to demonstrate significant benefits from implementing our products into routine use in leading hospitals; in Canada we today announced the start of a CardioQ-ODM implementation project. These together with similar projects in the pipeline in other countries, position us well to roll-out UK success into a number of export markets."

For further information, please contact:-

Deltex Medical Group plc                                    01243 774 837

Nigel Keen, Chairman                                         [e-mail]

Ewan Phillips, Chief Executive                           [e-mail]

Paul Mitchell, Finance Director                           [e-mail]

Nominated Adviser & Broker

Arden Partners plc                                             020 7614 5900

Chris Hardie                                                       [e-mail]

Jamie Cameron                                                  [e-mail]

Kreab Gavin Anderson                                      020 7074 1800

Robert Speed                                                     [e-mail]

Deborah Walter                                                  [e-mail]

Notes for Editors

Deltex Medical manufactures and markets the CardioQ-ODMÔ system. CardioQ-ODM changes the way doctors care for surgical patients allowing them to recover faster and leave hospital sooner and in better health than they otherwise would do. The performance of the system has been validated through independently conducted, randomised controlled clinical trials and is being translated into routine clinical practice in leading hospitals around the world.

CardioQ-ODM comprises a monitor and a single patient disposable probe. The probe is placed into the oesophagus through either the mouth or nose and the tip positioned facing the adjacent descending aorta. A low frequency ultrasound signal, generated by the monitor, is bounced off the blood travelling down the aorta and the Doppler principle is used to determine the velocity of the blood flow, expressed in distance per cardiac cycle - 'Stroke Distance'. The monitor also calculates the amount of time that blood is flowing down the aorta as a proportion of a cardiac cycle - 'Flow Time'.

The monitor uses a validated proprietary nomogram to extrapolate volumetric data (Stroke Volume, Cardiac Output etc) from the directly measured flow velocity. The nomogram utilises the patient's age weight and height, effectively to estimate the size of the aorta in which the velocity of the flow is being measured. Crucially this means that any reported relative change in Stroke Volume is absolutely identical to the relative change in the directly measured flow velocity variable of Stroke Distance. CardioQ-ODM immediately and reliably identifies even very small changes in the blood flow velocity allowing doctors to intevene earlier and on smaller changes than with any other approach.

Intra-operative individualised Doppler guided fluid management entails insertion and focusing of the probe to obtain a baseline reading, giving a small (200 to 250 ml) fluid challenge directly into the vascular system and seeing if Stroke Volume (or Stroke Distance) increases by more than 10%. If the increase is more than 10%, repeat fluid boluses are administered until such time as the increase is less than 10%: after this no further fluid is given unless Stroke Volume falls by more than 10% - the process is designed to achieve and maintain the individual patient's optimal Stroke Volume. CardioQ-ODM is also used during surgery to guide administration of vaso-active agents such as inotropes.

The CardioQ-ODM helps patients by enabling doctors to reduce the complications that arise from a medical condition that is common to almost all patients having surgery and many others in intensive care or arriving in the accident and emergency department. This condition is known as hypovolaemia - a reduction in circulating blood volume - and in surgical patients arises as a direct consequence of the combined effects of pre-operative starvation, the anaesthetic agents and the blood and fluid losses associated with the surgical procedure itself. Hypovolaemia means that the body struggles to get sufficient blood to the tissues and vital organs which are consequently starved of essential oxygen. This can cause medical complications including peripheral and major organ failure, which if not dealt with quickly can lead to severe compromise or even death.

There are already over 2,300 CardioQ-ODMscurrently in use in hospitals worldwide and distribution arrangements are in place in over 30 countries. In addition, there are currently more than 250 clinical publications on the use of the CardioQ-ODM which have repeatedly:-

·    Validated the results of CardioQ-ODMagainst known standards for measuring cardiac output

·    Proved that CardioQ-ODM works in a wide range of surgical procedures

·    Proved that CardioQ-ODMdelivers 50% or more reductions in post-operative complications and 25% or more reductions in length of hospital stay: better care at lower cost.

The SupraQÔis an entirely non-invasive device which uses an ultrasound probe held at the base of the patient's neck to track the flow of blood in the aorta; it presents the same data as the CardioQ-ODMin a similar format and is used for taking snapshots or monitoring over short periods.

 

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