An Insatiable Disease

Cancer is a grim disease, feeding off numerous sources including tobacco, infections, environmental pollution, occupational carcinogens, and radiation, among others. Whether directly or indirectly, everyone has experienced the effects of cancer at some point in their life. Wincing pain, weight loss, and an overwhelming feeling of fatigue all plagued my mom as she struggled to battle cancer on her own. Thankfully, my mom was able to conquer cancer, however, not everyone is as fortunate as her.

According to the Nation Cancer Institute, cancer is the leading cause of death worldwide, accounting for nearly 10 million deaths in 2020. In Canada, an estimated 2 in 5 Canadians will be diagnosed with cancer in their lifetime and about 1 in 4 will die from cancer. To put things into perspective, the Government of Canada estimated that in 2021, 229,200 Canadians would be diagnosed with cancer, with 84,600 dying from the disease. To make matters worse, there are more than 100 types of cancer.

With this in mind, breast cancer is the most common type of cancer, with 2.26 million cases reported in 2020. In the same period, breast cancer was also one of the most common causes of cancer death, ranking fifth just behind lung, colon, liver, and stomach cancer. Looking forward, an estimated 339,250 new cases of breast cancer are expected to be diagnosed in women in the United States (US) in 2022. Of this amount, approximately 43,250 women are expected to die from breast cancer in 2022.

Recurrence + Re-operation Rates

According to Cancer Treatment Centers for America, women with early breast cancer most often develop local recurrence within the first five years after treatment. On average, 7 to 11% of women with early breast cancer experience a local recurrence during this time. In other words, the need for re-operation occurs in approximately 1 in 4 cases, with variability among physicians ranging from 10 to 50%. There are a variety of risk factors associated with recurrent breast cancer, namely positive margins.

For context, a positive margin refers to when a pathologist finds cancer cells at the edge of the tissue, suggesting that the cancerous legion has not been removed during a lumpectomy, also referred to as breast-conserving surgery (BCS). That being said, recurrence risk double when positive margins are not excised, with 48% complication rates for re-operations. Unfortunately, things get worse.

According to a study published by the JAMA Network, data demonstrated that in 23.2% of BCS patients, the full benefits of BCS are not realized owing to the added costs and complications of subsequent surgery. Furthermore, patients undergoing additional surgeries incur an average of $16,072 in added health care costs. With this in mind, although many women will benefit from BCS, data suggests that we must implement techniques to reduce BCS reoperation rates, including advanced margin evaluation.

Perimeter Medical Imaging AI

• $157.06M Market Capitalization

Perimeter Medical Imaging AI Inc. (PINK.V) is a medical technology company transforming cancer surgery with ultra-high resolution, real-time, advanced imaging tools to address unmet medical needs. Referring back to BCS margins, current technologies do not have the image resolution needed to identify microscopic features associated with residual disease. With this in mind, surgeons require technology capable of providing high-definition imagery of margins and shaves during surgery.

Perimeter S-Series OCT Platform

In addition to the shortcomings of current technology, it takes several days to weeks before pathology reports on margin status are available. Moreover, if histopathology reports positive margins, patients must typically return for another procedure. For context, histopathology refers to the diagnosis and study of diseases of the tissue, in this case, cancer. Instead of replacing histopathology, Perimeter’s OCT is intended to provide intraoperative tissue visualization during primary surgery.

Optical Coherence Tomography (OCT) refers to an optical technology designed for high-resolution, cross-sectional imaging. Utilizing OCT, Perimeter’s S-Series OCT is capable of delivering 2mm subsurface imaging of excised tissue margins, allowing surgeons to make informed decisions in real-time during an operation. Additionally, Perimeter S-Series provides image review manipulation software and orientation labeling, allowing surgeons to identify and annotate microscopic tissue structures, as well as label and capture images of individual margins.

Aside from the Company’s Perimeter S-Series OCT platform, which obtained 510(k) clearance from the U.S. Food and Drug Administration (FDA), Perimeter’s B-Series OCT with ImgAssist technology is currently in clinical development. For more information related to the Company’s ImgAssist technology and Perimeter B-Series OCT, check out this article. In addition to Perimeter’s expansive portfolio of products, the Company boasts four issued patents, with another five pending approval in the US and internationally.

Latest News

Last month, on December 20, 2021, Perimeter announced the first commercial installation of the Company’s Perimeter S-Series OCT system at a North Texas hospital. Shortly after, on January 11, 2022, Perimeter announced the expansion of its ongoing pivotal study to include an additional clinical trial site.

This site will be located at Baylor College of Medicine in Houston, Texas, under the direction of Alastair Thompson, Principal Investigator of the study. Perimeter’s pivotal study will assess the Company’s Perimeter B-Series OCT imaging platform combined with ImgAssist AI and its impact on positive margin rates during breast conservation surgery.

“We are proud to partner with leading cancer centers like Baylor to enable the late-stage clinical development of our breakthrough-device-designated Perimeter B-Series OCT platform that includes AI-assisted software…,” commented Jeremy Sobotta, Perimeter’s Chief Executive Officer.

Approximately 300 patients undergoing breast conservation surgery across eight US clinical sites are expected to participate in the pivotal trial, with study completion expected for the end of 2022. Perimeter B-Series with ImgAssist AI is currently approved for Investigational Use Only in the United States (US), indicating that only select surgeons have access to this technology via Perimeter’s ongoing pivotal clinical trial.

Financials

According to Perimeter’s Q3 2021 Financial Results, the Company had cash and cash equivalents of CAD$7,775,195 on September 30, 2021, compared to CAD$10,025,122 on December 31, 2020. As of September 30, 2021, Perimeter had total assets and total liabilities of CAD$13,218,059 and CAD$2,474,329, respectively. Comparatively, Perimeter had total assets and total liabilities of CAD$13,156,449 and CAD$2,397,652, respectively, on December 31, 2020.

For the nine months ended September 30, 2021, the Company’s operating expenses increased to CAD$10,625,264 compared to CAD$5,925,253 for the nine months ended September 30, 2020. For the three months ended September 30, 2021, and September 30, 2020, these numbers translate to CAD$3,748,590 and CAD$2,201,256, respectively.

In total, for Q3 2021, Perimeter reported a net loss of CAD$3,782,699 compared to CAD$800,030 on September 30, 2020. As of September 30, 2021, Perimeter had 5,993,855 options outstanding. Of these outstanding options, 171,043 are exercisable at a price of $0.00 with a weighted-average remaining contractual life of 4.6 years.

On December 15, 2021, Perimeter announced that it had entered into a subscription agreement pursuant to which an affiliate of Social Capital Holdings Inc. will make a strategic CAD$34.4 million investment in the Company. Social Capital has agreed to subscribe, on a non-brokered private placement basis, for CAD$43.4 million in units of Perimeter at a price of CAD$3.00 per unit. Each unit consists of one common share and a total of one warrant, with each warrant enabling the holder to purchase an additional common share.

This investment will support the commercial launch of Perimeter’s initial imaging device for breast cancer, but equally as important, we believe it can accelerate their path to become the standard of care for many other surgical applications in the future,” stated Chamath Palihapitiya, CEO of Social Capital.

Additionally, the Company may issue up to an additional CAD$7,000,000 in units on substantially the same economic terms as those issued to Social Capital. The net proceeds of the private placement will be used for capital, commercialization, and development of Perimeter’s technology, clinical studies, and general corporate purposes, according to Perimeter. For more information, check out this article.

At the end of the day, I think we can all agree, fuck cancer.  Thankfully, companies like Perimeter are hoping to shift the narrative surrounding breast cancer recurrence and re-operation rates. Furthermore, Perimeter’s technology has the potential to deliver substantial savings for Payers. In total, the Company estimates that its technology could generate $856 Payer savings per patient. which is likely to motivate Payer coverage. Moving forward, Perimeter will likely provide updates regarding the Company’s Perimeter B-Series platform with ImgAssist, which is currently in clinical development.

Perimeter’s share price opened at $3.60 on January 21, 2022, down from a previous close of $3.65. The Company’s shares were down -4.11% and were trading at $3.50 as of 3:17 PM EST on January 21, 2022.