good info

  1. 115 Posts.
    found this- old but good. the most important point to note is that these 2 companies are now working together:


    It's A Small Biotech World After All

    BY CRAIG LIDDELL (profile) | October 14, 2002

    Two Australian biotech companies on the hunt for venture capital share some common history.

    Former market darling, Q-Vis, is struggling to secure their financial future after several challenges in the past year. These include the suspension of clinical trials, a declining share price, and a rights issue that largely covered costs. The company, previously linked to Kerry Packer, received a financial lifeline this year when cash reserves fell dangerously low.

    Q-Vis is involved in the development of solid state laser equipment used in eye surgery to correct vision. The development of solid state lasers has the potential to replace older technology gas lasers.

    Relative newcomer in a related optical field, CustomVis is looking less frail as recent winners of several government grants. The medical laser company also secured $10 million in venture capital.

    The two companies share history in CustomVis founder, Dr Paul van Saarloos, the scientist who was managing director of Q-Vis. Both have also used the services of US specialist, Dr Jon Dishler.

    Legal action indicates antagonism between the companies. Dr van Saarloos and CustomVis COO, Simon Gordon, both took their former employee to the Western Australia Industrial Relations Commission (WAIRC). Dr van Saarloos was replaced by John Roper in May 2000 and later claimed unfair dismissal. The same month, Gordon was dismissed. Dr van Saarloos settled his case out of court while Gordon won his claim and a subsequent appeal.

    But Dr van Saarloos denies such tension. Despite speculation, CustomVis wasn't formed as a result of his dismissal. "Q-Vis was set up by Dr van Saarloos after he graduated from University and he spent a significant amount of time and effort to build the company from the ground up and was later constructively dismissed. He is still a shareholder of Q-Vis, and has a significant economic interest in seeing Q-Vis succeed. "Also, QVIS has undertaken top quality scientific research on the benefits of solid state technology for refractive surgery, and Dr van Saarloos hopes they continue."

    He also outlines significant differences in the intellectual property and technology of the two companies. "Q-Vis uses solid state to generate a beam differently than 'excimer lasers', using a flash lamp pumped technology appropriate for standard surgery. They are not designed for custom surgery, and also have no surgical planning or fast scanning functionality."

    By contrast, "CustomVis is specifically designed for custom surgery, or customising the surgical plan specifically to the eye being treated," says Dr van Saarloos. "Each eye is different, and [our technology] permits us to customise each surgery to the unique needs of the patient." Additionally, some patients require a laser with more precision and repeat surgery. This is possible with CustomVis technology, he explains.

    Finally, "CustomVis has a commercial product which works today," according to Dr van Saarloos. "Q-Vis had some problems when they started trials ? which have been well documented." He also points to recent press articles suggesting they have run out of money.

    CustomVis' financial position is healthier after being awarded $250 000 under the Federal Government's Biotechnology Innovation Fund Grant. The AusIndustry grant will be used to produce a prototype of a particular refractive laser. The company has won several other grants including Commercialising Emerging Technologies (COMET).

    Those awards have been critical to accelerating commercialisation, according to Dr. William Ardrey, CustomVis president and Chief Financial Officer (CFO). "The initiatives by the Federal Government have made Australia in general, and CustomVis in particular, more attractive for investment. We have found that overseas private investors interested in Australian biotechnology have matched Australian government capital with their private equity capital at each stage of the CustomVis' development," he says.

    A first round a capital raising was held in May and a second round recently secured $10 million from private investors.

    Q-Vis has also received a recent cash injection. Shareholders approved a $2 million lifeline from the Lions Eye Institute in August. The company had only $1.14 million in the bank at the end of the financial year, down from $12.4 million the year before.

    Linked with the University of Western Australia, Q-Vis began as Excimer Laser Co. and changed names to Telco Medical Technologies (TMT) in 1995. That company had commercialisation rights to technologies invented by the Lasers and Bioengineering Group at the Lions Institute. Following a listing in 2002, the company became Q-Vis.

    As TMT, the company worked with Dr Jon Dishler of the Laser Institute of the Rockies in the United States. He received approval from the Food & Drug Administration for his excimer lasers. Dr van Saarloos, managing director of TMT at the time, designed those lasers.

    He is again being used by Dr van Saarloos in the trial of CustomVis technology. "Dr Dishler is an investigator for CustomVis in our US Food & Drug Administration Trials," he says. "He is one of the most successful refractive surgeons in the state of Colorado. He is not currently working for any other solid state refractive company."

    Despite a yearly loss of $11.8 million, Q-Vis is confident about the future. "The company's cash reserves of $3.5 million inclusive of the Lion's Institute funding will now give it twelve months to continue pursuing its objectives of technology development, regulatory approval and strategic alliance."

    The company believes "that the current market capitalisation of the company, which appears now to have stabilised in the mid twenty cents per share range, undervalues its core technology." Q-Vis appointed PricewaterhouseCoopers Securities to explore strategic opportunities such as alliances or funding of further R&D. "Q-Vis plans to continue the development of its technology with the aim of developing a fully reliable and commercially competitive solid state refractive laser."

    For CustomVis, the grants are an important validation for the company, says Dr van Saarloos. They were instrumental in the successful second round of funding. "We now have these commitments from the US, UK, Korea and Australia, and the money began flowing to CustomVis on 16 September, 2002."

    The funding will be used in several areas including the establishment of a manufacturing facility in Western Australia and continued R&D.

    "For biotech," he concludes, "Australia has many advantages including the availability of skilled engineers and university training for physics and medicine and the export orientation, especially in WA. R&D has been well supported by AusIndustry, local universities, and other government grants."
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