Perth-run company CustomVis plc has reported its third successive annual loss and launched a new capital raising, continuing the long and expensive journey to commercialise surgical laser technology developed in Western Australia.
Perth-run company CustomVis plc has reported its third successive annual loss and launched a new capital raising, continuing the long and expensive journey to commercialise surgical laser technology developed in Western Australia.
When CustomVis floated on London’s Alternative Investment Market in 2003, it predicted it would be making a profit by 2005.
Instead it incurred a loss of £4.6 million ($A10.8 million) in the year to June 2005, taking its total losses over the past three years to £9.3 million ($21.6 million).
This followed the big losses racked up by Australian company Q-Vis, which was also seeking to commercialise surgical laser technology developed in WA.
Q-Vis was one of the high flyers of the ‘tech boom’, gaining support from the likes of Kerry Packer’s Consolidated Press.
However, it lost more than $27 million in three years before going into administration in late 2002.
The founder of both companies was Paul van Saarloos, who developed innovative laser technology while working as a researcher at the Lion’s Eye Institute in Nedlands.
Dr van Saarloos said most of CustomVis’s activities were now run from its offices in Balcatta following a major cost-cutting drive over the past year.
The cost cutting included closure of its UK head office and a reduction in staff numbers from 70 to 27.
Dr van Sarloos said the company’s production facilities and most of its service engineers were based at the Balcatta office.
To support its ongoing operations the company has nearly completed a £1.5 million ($3.5 million) capital raising. To win support for the capital raising, the new shares are being offered at 5.75 pence per share, well below the 91 pence at which the company floated.
Dr van Saarloos’ first attempt to commercialise his eye surgery technology was through Q-Vis.
However, a falling-out with other directors meant he left soon after its stock market float in 2000.
He established CustomVis in 2001 and quickly gained backing from the federal government, winning a $250,000 grant from the Biotechnology Innovation Fund.
CustomVis also gained backing from investment bank Poynton & Partners, which helped it raise seed capital from private investors.
It raised a further £11.5 million prior to floating on AIM in 2003 and proceeded to expand its production and sales activities.
Dr van Saarloos remains confident that its ‘corneal reshaping system’, now known as Pulzar Z1, is superior to the ‘excimer’ laser technology that is widely used in eye surgery.
“It is far more reliable, far easier to use and has technical features that match or better all of its competitors,” he told WA Business News.
However, it has faced delays in completing clinical trials, in part because it needed to make design changes to satisfy the Therapeutic Goods Administration of Australia, and that in turn has made it harder to secure sales.
“As a result of sales delays and the depletion of cash reserves, the group was forced to reduce the cash burn rate,” UK-based chairman Bill Colvin said.
“Staffing levels and overheads have been reduced substantially.”
Despite this, the company’s cash reserves have fallen to just £1.22 million, prior to the latest capital raising.
