– Approval triggers fourth and final US$5.9 million milestone payment to Conavi Medical, which it will use to extinguish the promissory note owed by it to EOM –
– Conavi Medical eligible to receive future tiered royalty payments, ranging from 5.0%-10.0%, on net EOM coronary imaging system sales in China –
TORONTO, Dec. 09, 2024 (GLOBE NEWSWIRE) -- Conavi Medical Corp. (TSXV: CNVI) (“Conavi Medical” or the “Company”), a commercial stage company focused on designing, manufacturing, and marketing imaging technologies to guide common minimally invasive cardiovascular procedures, is pleased to announce that its exclusive licensing partner in China, East Ocean Medical (Hong Kong) Company Limited (“EOM”), has received approval by the China National Medical Products Administration (“NMPA”) for its coronary imaging system, which is based on Novasight Hybrid™ System intellectual property licensed to it by the Company via a June 2021 technology transfer and licensing agreement ("TTLA"). EOM is an affiliate of Grand Pharmaceutical Group Ltd., which is a Hong Kong-based company principally engaged in the manufacturing and sales of pharmaceutical preparations and medical devices.
Pursuant to the TTLA, the NMPA approval of EOM’s coronary imaging system triggers a fourth and final milestone payment of US$5.9 million by EOM to Conavi Medical. While Conavi Medical expects to recognize the milestone payment as licensing income in the current fiscal quarter, it will use the total proceeds to fund the repurchase of the outstanding principal plus accrued interest balance in respect of a promissory note owing to EOM. The balance of this promissory note is also US$5.9 million, thereby extinguishing all of the Company’s debt owed to EOM. Upon future commercialization in China, EOM will pay to Conavi Medical certain tiered royalty payments, ranging from 5.0%-10.0% of 75.0% of amounts invoiced to EOM coronary imaging system customers, provided that EOM shall pay a minimum nonrefundable annual royalty of US $250,000, which shall be creditable against the royalties otherwise due pursuant to the TTLA.
“We congratulate our China licensing partner, EOM, on receiving NMPA approval of its Novasight Hybrid-based coronary imaging system,” said Tom Looby, Conavi Medical’s CEO. “The NMPA approval marks a major milestone for both companies and provides important additional validation of our hybrid imaging technology, which is the first to combine two major intravascular imaging modalities – IVUS and OCT – to help guide common minimally invasive coronary procedures. China is an important market for emerging medical technologies, and we look forward to EOM’s commercial launch of the technology early next year.”
About Conavi Medical
Conavi Medical is focused on designing, manufacturing, and marketing imaging technologies to guide common minimally invasive cardiovascular procedures. Its patented Novasight Hybrid™ System is the first system to combine both intravascular ultrasound (IVUS) and optical coherence tomography (OCT) to enable simultaneous and co-registered imaging of coronary arteries. The Novasight Hybrid System has 510(k) clearance from the U.S. Food and Drug Administration; and regulatory approval for clinical use from Health Canada, China’s National Medical Products Administration, and Japan’s Ministry of Health, Labor and Welfare. For more information, visit http://www.conavi.com/.
Cautionary Statement Regarding Forward-Looking Information
This news release contains “forward-looking statements” within the meaning of applicable Canadian and U.S. securities laws, which reflect the current expectations of management of Conavi’s future growth, results of operations, performance and business prospects and opportunities. Forward-looking statements are frequently, but not always, identified by words such as “may”, “would”, “could”, “will”, “anticipate”, “believe”, “plan”, “expect”, “intend”, “estimate”, “potential for” and similar expressions, although these words may not be present in all forward-looking statements. Forward-looking statements that appear in this release may include, without limitation, references to Conavi’s plans for the commercialization of its Novasight Hybrid™ System, and EOM’s plans for the commercialization of its coronary imaging system and potential royalties payable to Conavi in connection therewith.
These forward-looking statements reflect management’s current beliefs with respect to future events, and are based on information currently available to management that, while considered reasonable by management as of the date on which the statements are made, are inherently subject to significant business, economic and competitive uncertainties and contingencies which could result in actions, events, conditions, results, performance or achievements to be materially different from those projected in the forward-looking statements. Forward-looking statements involve significant risks, uncertainties and assumptions and many factors could cause Conavi’s actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. Such factors and assumptions include, but are not limited to, Conavi’s ability to retain key personnel; its ability to execute on its business plans and strategies; and other factors listed in the “Risk Factors” sections of the joint information circular of Conavi dated August 30, 2024 (which may be viewed at www.sedarplus.com). Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance, or achievements may vary materially from those expressed or implied by the forward-looking statements contained in this news release. These factors should be considered carefully, and prospective investors should not place undue reliance on the forward-looking statements.
Although the forward-looking statements contained in the news release are based upon what management currently believes to be reasonable assumptions and Conavi has attempted to identify important factors that could cause actual actions, events, conditions, results, performance or achievements to differ materially from those described in forward-looking statements, Conavi cannot assure prospective investors that actual results, performance or achievements will be consistent with these forward-looking statements. Except as required by law, Conavi expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Accordingly, investors should not place undue reliance on forward-looking statements. All the forward-looking statements are expressly qualified by the foregoing cautionary statements.
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