Qualia’s mammography CAD effort gains backing from BioChem Pharma

Canadian firm steps in to help with funding

Qualia Computing brought in a big gun last month to help advance its Second Look computer-aided diagnosis (CAD) workstation for mammography analysis through the Food and Drug Administration and into radiology offices worldwide (SCAN 6/25/97). The privately held U.S. startup signed a licensing and development relationship with BioChem Pharma of Laval, Quebec. Help from BioChem's established regulatory staff, along with the use of an innovative new product-review procedure at the FDA, should expedite Second Look's time to market commercialization.

Qualia last year granted marketing rights for Second Look to Briana Bio-Tech of Edmonton, Alberta, a small medical technology firm. Qualia followed that agreement up by displaying a working prototype of Second Look at last year's Radiological Society of North America conference. Qualia and Briana decided to restructure their relationship, however, because Qualia's development effort was proceeding rapidly and had begun to require a level of funding that was more than Briana could handle alone, according to Romano Robusto, president and CEO of Briana. A larger partner should enable the companies to get Second Look to market smoothly.

Under last month's deal, Qualia will now work primarily with BioChem to position and commercialize Second Look. Briana remains in the picture, however, as a 49% partner with BioChem in a privately held joint venture company formed to funnel funding into Qualia's effort, according to Robusto. The joint venture's staff is limited to Robusto and two BioChem representatives.

The legwork in assisting Qualia through the regulatory process and to market will be done by BioChem's diagnostics subsidiary, BioChem ImmunoSystems. As part of the agreement, BioChem will take an unspecified equity stake in Qualia, complementing the 5% position it already holds in Briana.

Robusto had worked previously at BioChem, helping to propel that firm from 30 employees in 1988 to a work force of around 1000 now. He last served as vice president of Asia/Pacific operations, but was also involved in acquisition activities, particularly at BioChem ImmunoSystems. Robusto left BioChem in 1996 to help revamp Briana's product strategy and duplicate the type of growth experienced by BioChem.

Briana retains an option to market Second Look in the Asia/Pacific region, as well as rights to discuss cooperation on derivative products from Qualia, Robusto said. Qualia is already exploring the application of its CAD technology in digital mammography, an outgrowth of Second Look's analysis of digitized mammographic films.

Second Look might navigate the FDA's premarket approval (PMA) process faster than usual through the use of a new PMA procedure called a modular submission, said Steve Rogers, CEO of Qualia, which is based in Beavercreek, OH.

"The FDA is out to change the mode of operation in which you dump a two-foot-high stack of papers on their desk when you do a PMA," Rogers told SCAN. "They will allow us to submit to them any pieces (modules) of the PMA submission at any time. They will work on those as we submit them."

Another mammography CAD firm, R2 Technology of Los Altos, CA, was also able to take advantage of streamlined FDA procedures to get its product to market quickly. The FDA approved R2's expedited PMA in July, making that company the first mammography CAD developer to get a product on the U. S. market (SCAN 7/22/98).