IB Letter to Shareholders

IQ-AI Limited

13 October 2023

 

IQ-AI Limited

("IQ-AI" or the "Company")

Imaging Biometrics LLC Letter to shareholders

IQ-AI Limited ("IQAI") (LSE: IQAI) a developer and manufacturer of medical image processing platforms, has today released a letter to shareholders on behalf of Michael Schmainda, CEO of IQ-AI's wholly owned subsidiary Imaging Biometrics (the "Company"), covering several material recent developments in the Company, including, inter-alia,

·      Regulatory milestones achieved for oral Gallium Maltolate

·      IB Clinic™ & IB Nimble™ deployments

·      New applications for IB Neuro

The full text of Mr Schmainda's letter follows:

Dear Shareholders,

I am pleased to share this update with you. It summarises our progress made and outlines some major milestones to be achieved.

Earlier this year, we made the strategic decision to apply for a Current Procedure Terminology (CPT) code specific to the DSC perfusion technology available in IB Neuro. CPT codes are assigned and maintained by the American Medical Association (AMA). They are used to track and bill medical services for payer reimbursement. Like regulatory clearance, CPT codes are a critical aspect in achieving widespread commercial adoption in healthcare. Currently, a few of our clients are using a general, non-specific CPT code to get reimbursed for the MRI procedures that rely on IB Neuro, but only a limited few. This lack of a reimbursement pathway makes it more difficult for hospital administrators to justify investing in IB products. Fortunately, enough scientific and clinical validation have been performed by our co-founder, Kathleen Schmainda, PhD and her colleagues over the years, and a growing number of sites are routinely using IB Neuro as the standard of care, to warrant a dedicated CPT code. The application is due in early November and a final decision will be made in May 2024. A CPT code will help make for easier buying decisions for healthcare administrators.

IB Clinic Deployment

Steady progress is being made in the deployment of IB Clinic; both in terms of direct sales and through our established partnerships. We are encouraging our long-standing clients to migrate from our legacy, manual, and Mac-based platform, and upgrade to our platform-independent and automated IB Clinic application. This upgrade is being well received as it addresses the many challenges facing busy radiology departments around the world. For example, it consolidates needed information on a single dedicated workstation and creates a one-stop-shop for busy radiologists, it reduces the number of workstations requiring support from IT personnel, and it offloads MR Technologists who no longer have to manually process the information.

These gains in clinical efficiency dovetail perfectly with our strategy of making IB products accessible on larger, more comprehensive platforms, such as those offered by GE Healthare, Bayer, TeraRecon, and our other partners. Currently, we are working very closely with each of them in preparation for a busy tradeshow season. And, as you can imagine, all our partners share in our excitement of potentially receiving a CPT code for IB Neuro.

IB Nimble

Our development team has made tremendous enhancements to our handheld / mobile application, IB Nimble. Specifically, the code base is being re-engineered to enable widespread distribution and efficient support. More work remains, but interest is steadily growing from other brain (mets) cancer centers. As promised, we also deployed IB Nimble for use in a new disease group, metastatic bone cancer, at the Medical College of Wisconsin (MCW). We anticipate at least one more installation in Q4 2023.

Also, we just accepted an invitation to participate in a new initiative launched by the American Brain Tumor Association (ABTS) called the Metastatic Brain Tumor Collaborative. Among other benefits, this is an ideal opportunity to present IB Nimble and IB Clinic to broad audiences throughout 2024.

IB Neuro

Our flagship product, IB Neuro, continues to be used to advance the field of neuro imaging with ground-breaking research. Recently, a major multi-center study was published in Nature Communications, a prestigious scientific journal with a high impact-factor, in which IB Neuro was used to identify infiltrating cancer in the margins of tumors. Using IB Neuro, the team of researchers found that the invasive tumor margins contain biologically distinct genetic and molecular alterations. This information gives insights regarding tumor aggressiveness and disease recurrence, and it also provides information that can optimise treatments that could improve future outcomes. Essentially, the information could potentially direct which treatments will be most effective on a personalised basis.

At the recent American Society for Functional Neuro Radiology (ASFNR), Dr. Jerry Boxerman, MD presented preliminary results from a study that used a specific output of IB Neuro called percent signal recovery (PSR). The study showed promise in distinguishing tumor types which is significant because it demonstrates a noninvasive way to obtain critical information that is currently obtained via invasive surgical procedures.

Finally, funding from current NIH grants continues and new funding opportunities are being explored. It is through these grant collaborations with top academic centers that result in the translation of ground-breaking treatments into routine clinical care. We have identified a large new grant opportunity that is specific to our core imaging technologies, and we are evaluating potential aims for a February submission.

Clinical Trial Update

Our sponsored phase 1 clinical trial of oral gallium maltolate (GaM) has increased momentum since it opened in March of 2022. Patients enrolled and were prescribed escalating doses of the agent per the trial's design with the primary goal of identifying the maximum tolerated dose (MTD) for a phase 2 trial. Because patients have tolerated the agent so well, an amendment to the trial's IND had to be written and has since been approved to allow subjects to be administered higher dose levels. This is because the patients have tolerated the initial doses of the agent extremely well and a phase 2 trial requires that a MTD be determined. This dose escalation corresponds to an increase of subjects from 24 to 36. As soon as the MTD is determined, enrollment for the phase 1 trial will halt, data will be summarised, and focus will shift for the commencement of the phase 2 trial.

In addition, the FDA recently granted orphan drug designation (ODD) status for GaM in the treatment of another rare cancer, atypical teratoid rhabdoid tumor (ATRT), which was based on yet another pre-clinical study conducted in the Schmainda lab at MCW. This is the second ODD for GaM this year. We are currently working on an application for FDA Fast Track Designation. This is a program the FDA uses to fosters accelerated development and review of drugs that treat conditions with an unmet clinical need. We are targeting a submission by the end of October.

Once that submission is under review, and to leverage our ODD designation for pediatric brain tumors (GBM and ATRT), we will apply for a Rare Pediatric Disease Priority Review Voucher (RPD-PRV). Like the Fast Track program, RPD-PRV is another accelerated pathway authorised by the FDA which offers incentives for development and approval for promising drugs. If IB is successful in applying for an RPD-PRV, the vouchers can be transferred (sold) to other companies and the trading price of a PRV, per KIDS V CANCER (givekidsachanceact.org), is averaging $100 million.

Finally, since the trial's launch, Dr. Jennifer Connelly, MD, the principal investigator of the trial, has escalated the trial's exposure to a global level through her many lectures and speaking invitations. Recently, she was invited to speak at the Society of Neuro Oncology (SNO) Africa meeting in early November.

Our optimism remains high for the multiple initiatives we are pursuing, and we look forward to sharing additional information as more progress and milestones are achieved.

Sincerely yours,

Michael Schmainda,

CEO

Imaging Biometrics, LLC

Director IQ-AI Ltd

--ENDS-

The Directors of the Company accept responsibility for the contents of this announcement.

For further information, please contact:

IQ-AI Ltd

Trevor Brown/Vinod Kaushal/Brett Skelly/Michael Schmainda

Tel: [phone]

Peterhouse Capital (Financial Advisor and Broker)

Lucy Williams / Heena Karani

Tel: [phone]

About Imaging Biometrics® LLC:  IB is a wholly-owned subsidiary of IQ-AI Limited, (LON: IQAI), and focuses on delivering quantitative imaging platforms and therapeutics that transform how clinicians diagnose and treat patients more efficiently and effectively. For more information about Imaging Biometrics, visit the company's website at www.imagingbiometrics.com. Follow IB on Twitter, @IQAI_IB.

 

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