Listing gets Artrya moving

PERTH-BASED Artrya has been quick off the mark in its development of software to help with the early detection of heart disease.

The startup was founded in 2019 and listed on the ASX in November 2021, with the hours invested in securing regulatory approvals surpassed only by those in the lab.

Artrya uses machine learning, a branch of artificial intelligence, to detect coronary artery disease from CT scans.

The software received a regulatory green light in Australia in November last year.

But Artrya was knocked back by the US Food and Drug Administration in June of 2022. Artrya shares dropped more than 35 per cent on the news.

That setback was short-lived, however.

In October, Artrya announced another step towards the certification (through a European Notified Body) of its Salix Coronary Anatomy software for marketing in the European Union.

The business has since received regulatory approval from an ENB to market the software in the UK.

Artrya managing director and chief executive John Barrington said securing regulatory support had been a tough journey.

Regulators need to balance supporting promising medical treatments against ensuring high safety and efficacy, he said.

“One of the great challenges for biotech, medtech companies, is regulatory approval,” Mr Barrington told Business News.

“They are big curves.

“You need the knowledge and experience of the regulatory approval processes and what the regulator requires “It’s a lot of work and you need that capability to be able to meet those requirements in the submission.”

To build the business to this point, Artrya needed to raise capital.

Artrya raised $40 million during its initial public offering when it listed on the ASX, with a $105 million valuation.

That put the deal near the top of the Business News list of recent innovation IPOs.

“Without the capital, you can’t do anything,” Mr Barrington said.

He said the funding issue had been alleviated by the $60 million raised for Artrya in the past two and half years from the market.

“The other thing about that is we raised $40 million at a valuation of $105 million [during the IPO process],” Mr Barrington said.

“Technology stocks have cut off substantially, given the changing environment.

“What we took in the approach, in terms of raising capital, is in the initial round we want a small shareholder base of blue-chip investors in Western Australia.

“We then extended that quality shareholder base and shareholders who understood that they weren’t running the business, but they were always available for advice and counsel.”

At the time of the IPO, Artrya had attracted some notable investors in the Perth business community, including property developers Adrian Fini and Ben Lisle (see table).

Liquid

In terms of turning a tech startup into a successful business, Mr Barrington said setting a minimum quantum of funding to target was a key factor.

“First rule of business is ‘don’t run out of cash’,” he said.

“The other point is to ensure there’s sufficient capital early enough.

“Double your expenses and halve your revenue expectations and then do it again, because it’s never going to turn out the way you expect.

“Begin working on the capital-raising process early before you need it, well in advance of need, and be prepared for many rejections.”

Mr Barrington listed access to talent as the third biggest obstacle for Artrya.

“Access to talent is a challenge but all our people are from Perth,” he said.

“We’ve got 12 nationalities represented, 30 per cent of our workforce is female.”

The business has expanded from a small team working in Subiaco to occupying a two-storey office at the former Westpac building in West Perth.

Mr Barrington said the next international market for Artrya would be Canada, with the business having already signed an agreement with the Ottawa Heart Institute to access its data.

The Australian Institute of Health and Welfare found an estimated 571,000 adult Australians had coronary artery disease in 2020-2021.

Data from the institute shows the disease was the leading single cause of death in Australia in 2020, accounting for 16,600 deaths.

According to a 2020 study by the Global Epidemiology of Ischemic Heart Disease, coronary artery disease is the largest cause of death worldwide, with 9 million deaths attributed.

The study found about 126 million people were affected by coronary heart disease.

“The major predictor of heart attack, fatal and non-fatal, is a soft plaque in the coronary arteries,” Mr Barrington said.

“So, this is really important, but it’s not generally reported because it’s inordinately difficult to see with the naked eye.

“It’s a massive global problem that hasn’t been solved for 50 years.

“Increasing ageing, population, lifestyle issues; this is a big problem to solve and, with technology, we actually can.”

Artrya’s software product uses AI to identify the soft plaque in the arteries and produce a 3D model.

The Salix Coronary Anatomy software could produce a report of international standards within 15 minutes, according to Mr Barrington.

Artrya chief technical officer Julien Flack said the software was about improving the efficiency and effectiveness of a clinician’s caseload.

“The software provides a lot more automation that’s in the standard of care as it stands today, so there’s a lot more analysis of the CT scan using artificial intelligence means,” Dr Flack told Business News.

“We’ve gathered a large amount of training data through our work with Harry Perkins [Research Institute] and other technicians.”

Dr Flack said the software was not a replacement for medical professionals but rather an aid for the clinician to be fully in control of the process.

“It’s all about improving the efficiency and effectiveness … they can get through their caseload,” he said.

“From the outset, we’ve always wanted to move away from this concept of ‘artificial intelligence against a clinician’.

That’s not what we’re about.

“For us it’s about the artificial intelligence with the clinician; could we do better than the clinician by themselves?

“There’s always going to be a human, a clinician, in the loop. Our software is designed specifically for that type of environment rather than to replace it.”

Mr Barrington said Artrya was working on a new product that would assess coronary blood flow without the need to insert a wire into the artery.

“We haven’t released this product as yet, but we’ve developed the algorithms,” he said.

“The cardiologists use a measure known as fractional flow reserve to assess coronary blood flow.

“It’s expensive. It takes a lot of time.

It’s risky because you could puncture the coronary artery.

“We can now provide that scale of measure automatically off the single CT scan without the invasive procedure.”

Artrya is working to apply for regulatory approval for that product, Salix Coronary Flow.