iCAD, Inc. (Nasdaq: ICAD), an industry-leading provider of advanced image analysis, workflow solutions and radiation therapy for the early identification and treatment of cancer, today reported financial results for the three and six months ended June 30, 2012.
“Our financial results for the second quarter of 2012 were mixed as we experienced weaker than anticipated revenues, while we continued to make solid progress managing expenses and reducing cash burn,” said Ken Ferry, President and CEO of iCAD.
“Cancer Detection revenues reflect a slowing in the transition from film to digital technology in mammography as the cycle nears completion. We are transitioning our business model to increase our recurring revenue by offering our products on a subscription basis. To that end, we were delighted to launch PowerLook AMP, our next-generation mammography computer-aided detection (CAD) system in July of 2012. This new platform brings to the radiologist a leading-edge set of additional workflow tools such as breast density and tissue and lesion measurements. We recently began to market this upgrade to our U.S. installed base of more than 3,500 systems, and expect that, over time, this system will provide us with a considerable revenue opportunity.
“Therapy revenue was substantially stronger compared to the second quarter of 2011; however, due to a few deals pushing into the third quarter, we were not able to achieve the sequential quarterly revenue growth that we anticipated. We did, however, book two of these orders in early July which has helped to get the third quarter off to a good start. Interest and momentum continues to grow in the Axxent ® Electronic Brachytherapy ® system as evidenced by the number of new controller sales in the first half of 2012 compared to the same period last year, as well as from the significant growth of Intra-Operative Radiation Therapy (IORT) procedures-based consumable sales. Balloon applicator sales, which are used primarily with breast IORT, set a record with 161 units sold in the second quarter and 286 units sold during the first half of 2012. This compares to 61 units for the first half of 2011, representing a nearly five-fold increase in procedure volume.“In addition, the Centers for Medicare and Medicaid Services, in their 2013 proposed rule assigned a separate payment value for IORT delivery treatment codes. We are quite pleased with this proposed decision and believe this will only add to the pace of adoption of breast IORT.