Infrared Sciences wins approval from FDA for BreastScan IR

March 10, 2004

Firm seeks $2 million investment to build machinesInfrared Sciences has received FDA approval for its digital infrared breast imaging system, paving the way for the Hauppauge, NY, company to begin placing the BreastScan IR in

Firm seeks $2 million investment to build machines

Infrared Sciences has received FDA approval for its digital infrared breast imaging system, paving the way for the Hauppauge, NY, company to begin placing the BreastScan IR in clinical use at women's health centers, radiology facilities, and hospitals.

BreastScan IR, which is designed for use as an adjunct to mammography and ultrasound, noninvasively images patients in an upright position. The breast need not be compressed, as it is with conventional x-ray mammography. An infrared map of the breast is generated and interpreted algorithmically, with the computer identifying potential problem areas. Physicians are then provided with an objective report of findings. The entire procedure takes about 10 minutes.

Two systems are installed, and three are on order. Two customers account for this demand: Long Island Diagnostic in East Setauket, NY, and Arena Oncology in Great Neck, NY. Infrared Sciences is negotiating to place systems in two major university medical centers, according to the company. Several private clinics have also expressed interest.

Plans to fill orders are on hold until additional funding can be obtained, however, because Infrared Sciences wants to charge on a fee-for-use plan rather than sell the equipment, as is more commonly done. Additional investment is needed to build the machines, which cost $75,000 apiece.

"At this point we have more centers asking for the equipment than we have machines," said Thomas DiCicco, president of the company. "I'm hoping (the FDA approval) will help us find some investors."

The company plans to charge a portion of the fee that providers are reimbursed for performing each procedure. The goal is to eventually place systems in at least 10% of the 10,000 women's health centers in the U.S. If they are used routinely at these centers, revenues could be staggering.

First, however, the company needs about $2 million to get the ball rolling. That money would be used both to build additional systems and to fund patient and physician education, DiCicco said. With additional investments, the company could put enough systems in place to generate the revenue needed to install an unlimited number of systems down the road, if all goes according to plan.

"Once we have systems functioning, each one pays for the next," DiCicco said. "A system pays for itself in three or four months of use. Every time that happens, we will install another machine. This way we would never seek another bit of money-once we have $2 million and get things running."