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Personally I'd rather IQAI remains and take the licensing income. Hard to think of better long term investments.

I think you are right, I'm sure many of us hold a lot more than £1k's worth. And I think that a lot of the shares are in the hands of LTH who won't be selling at the present price.

Great article! I confess I hadn't completely grasped all the advantages of having Orphan Drug Designation (ODD)

Securing orphan drug designation from regulatory agencies such as the FDA offers a number of advantages to treatment developers and, ultimately, to patients:

* Financial Incentives: Companies receive various financial benefits, including tax credits for clinical research costs, grants for drug development, and potential fee waivers, making the development process more economically viable.

*Market Exclusivity: Upon approval, the drug enjoys a period of market exclusivity, typically seven years in the United States, during which competitors cannot market a generic version. This exclusivity can be a significant financial advantage.

* Regulatory Support: Companies often receive more extensive guidance and support from regulatory agencies during the drug development process, which can expedite the time to market.

* Lower Regulatory Hurdles: The criteria for clinical trial success may be more flexible for orphan drugs, given the rarity and severity of the conditions they treat. This can make it easier to demonstrate efficacy and safety.

* Access to Funding: ODD can make a drug candidate more attractive to investors, as the designation often implies a faster, less expensive, and less risky development pathway.

I don't think someone who holds around 30% of the company would be messing around selling £2k at a time!

I think someone explained it a week or two ago - MMs drop the bid to encourage people to sell for fear of losing their paper profits. Pretty sure that's what happened yesterday morning. Obviously we'd all rather be sitting on (larger) paper profits but today's price is not very relevant in the end if you are a LTH and believe this company is or will be worth much more than the current market cap. Of course this means that there's often little liquidity and large price swings on small trades.

I did a limit order at full ask this morning and it didn't execute. I was checking the live price and my order was "monitored" for about 10 mins with my limit being full ask. Maybe just a crap online broker I suppose, but I don't think there was much liquidity for PIs to buy.

Good luck - it was impossible to buy an hour ago

He can't buy us out unless we sell though. I don't intend to sell!

I've just tried to buy ~£1000 at the full ask (3.6) and can't. Draw your own conclusions!

I guess there can be any number of reasons why FAB would sell ~10% of their holding. Sometimes people want/need to free up some cash for completely unrelated reasons. I don't think it's particularly cloak and dagger to dispose of shares without indicating why. None of us are obliged to say why we buy or sell.

I don't see any trades reported since before midday. Is this another blackout while a big order is filled (as surmised during the gap on wednesday)?

I agree! I don't have a "trading" strategy though - I have a "buy and hold" strategy and have had for over 6 years

The 15-min delayed ticker shows a nice steady rise - which I think is to be expected as for years the downside for this share was the execution risk. The underlying IP has been compelling for years now, but it is really difficult for a small company to bring products to market at scale. The recent developments with the partnership with GE change this risk-reward balance significantly. As others have recently pointed out, the size of the addressable market is huge (£billions per annum) and the market cap of IQAI utterly fails to reflect this at the current market cap (< £10M).

I hope so! I am a LTH, but I sold all my shares before the suspension, so had a lucky escape. I sold because I thought they were maybe 30% overvalued. I have bought back in, but in a small way. Feel very sorry for all those caught in the suspension - it's happened to me with other holdings :(

---- conclusion of my 2017 notes

At the time of writing, there is a risk that the CE Mark and 501(k) FDA approvals are not granted as anticipated. As StoneChecker is an indicator of treatment path, the burden of proof is significantly lower than that for a new drug; coupled with the excellent trial data, this risk thus appears small. On balance, the ratio of risk to potential reward for this micro-cap UK company seems extremely promising to me.

----2017 text continued ---

The value of the company lies in the intellectual property inherent in the algorithmic (artificial intelligence) functionality of StoneChecker and the capacity to apply similar approaches in other medical applications. Machine-aided diagnostic decision making looks likely to become increasingly prevalent in radiology and other areas of medicine.

Following StoneChecker, the company's next revenue stream will come from StonePrevent. This uses a complex, algorithmic approach to combine results from blood tests, urine tests, and analysis of lifestyle and diet to offer advice on how a patient can prevent a recurrence of kidney stones. Currently 50% of patients presenting for kidney stone treatment have previously had kidney stones, so there is much value in preventing recurrence. It is notoriously difficult to produce clear, effective advice to patients with multiple health problems and in the UK currently only a handful of clinics offer kidney stone prevention advice. StonePrevent aims to provide a single point to which all the patient's data is directed, it will synthesise the information and produce an automated report returned to the referring doctor. This is currently in a pilot stage and preliminary results will be presented at a conference of medical practitioners in Dec 2017; the company anticipates useful feedback on the automated reports the product produces. This artificial intelligence, individualised, data-driven approach to providing medical advice is likely to be highly effective and cost-saving. It is likely to become widespread and a high priority for Health Maintenance Organisations in the USA and organisations like The National Health Service in the UK.

Financial details on the revenue streams StoneChecker will generate are not yet in the public domain. The cost of a single lithotripsy treatment is around £750 in India or the Philipines. If we adopt this as an average global cost, assume a potential population with access to treatment of 3 billion people, and assume that StoneChecker is licensed for use on a single patient by StoneChecker Software Ltd for 0.1% of the cost of a single lithotripsy treatment, this indicates an annual revenue stream of £18M. Software companies have relatively fixed costs, so the overwhelming majority of this revenue should become net income. If we assume a price-earnings ratio of 10, this implies a market cap around £150M once StoneChecker is widely adopted. This is over a factor of 50 greater than the current market cap, and does not include any value from StonePrevent or future applications of the company’s expertise in data science and application of artificial intelligence in medical treatment.

There appear to be few risks from competition: practitioners were enthusiastically surprised by the software's most basic outputs, and the partnership with providers of lithotripsy hardware in the USA provides friction-free access to that market.

----2017 text continue

---2017 text continued from last post ----

This is a ground-breaking and unique use of CT scan data, and allows clinicians to greatly improve their ability to select the most appropriate treatment for each particular kidney stone. Thus it is possible to move promptly to surgical removal for stones which cannot be successfully treated with lithotripsy.

Trials of the StoneChecker software have been completed in the UK and China, with the predictive power of the composite score exceeding expectations to the extent that the trials required fewer patients than anticipated to reach the planned statistical significance. Importantly, the excellent predictive power of the composite score was manifest in both the UK and China despite the significant lifestyle differences in the two populations. With this testing complete, the company is in the process of obtaining CE Marking from the European Union. Granting of the CE Mark is expected in mid-December 2017. StoneChecker can then begin commercial sales in 33 European countries, India and China. In the USA, StoneChecker is in partnership negotiations with a major US lithotripsy hardware provider. This partner plans to integrate the software into their equipment to improve treatment efficiency. The FDA consider this a Class 1 medical device, i.e., it indicates the optimal treatment path rather than the initial diagnosis. The relevant regulatory procedure is Section 501(k) of the Food, Drug and Cosmetic Act. StoneChecker and their partner anticipate securing this approval by June 2018, and plan to then promptly roll-out commercial operations in the USA.

Flying Brands and Stone Checker Software Ltd are very small companies, and have been loss-making while developing StoneChecker. They are now poised to begin generating revenue from the StoneChecker software, and have credible plans for penetrating a significant fraction of the global market for kidney stone treatment over the coming months. Clinicians participating in the tests were unexpectedly enthusiastic about StoneChecker's reporting of the basic stone parameters: position in the body, volume, and shape. This automatically-provided, straightforward information allows the clinician to align the lithotripsy equipment more accurately, making the treatment more effective and the clinician's job much easier. These outputs from StoneChecker are much more straightforward than the composite score which the software was designed to produce, and are consequently a much easier sell. It seems likely that the software will be quickly adopted by a majority of kidney stone treatment providers.

The management of Flying Brands and Stone Checker Software Ltd have experience in medical software, Sino/Western business ventures, and have made strategic partnerships to facilitate the commercialisation of their product.

---2017 text continues in next post ----

The post by Digger01 yesterday prompted me to dig out my back of the envelope calculations of what stonechecker might be worth if it is widely adopted. I wrote the notes below in 2017 when the market cap of FBDU was £2.75M. I have held this share without selling any since then as I felt the case was just to good if the small company could get their product to market. Obviously I am still holding after the news about GE.

----2017 text follows:

Flying Brands in an investment company which owns Stone Checker Software Ltd. The latter is a medical software company with a soon-to-be commercialised application to aid in the diagnostic assessment and treatment of kidney stones. About 23% of US males and 15% of US females currently develop kidney stones. The risk of kidney stones is correlated with high blood pressure, diabetes and obesity. These diseases of affluence are on the rise in the USA, Europe and worldwide. Consistent with this, a statistically significant rise in the fraction of the population developing kidney stones has been measured in data from South Carolina in the interval 1997-2012. Over this five-year study, the fraction of people developing kidney stones increased by between 3% and 45% depending on which subsample was examined. Combined with the already significant prevalence of kidney stones, this means there is a large and growing potential market for the StoneChecker software, both in the USA and globally. People who develop kidney stones have a 30-40% recurrence rate in the five years following treatment.

If we assume lifestyles leading to the current US prevalence of kidney stones, the statistics imply around 8 million cases of kidney stones per billion people per year. Kidney stones can produce excruciating pain, which female sufferers assess as comparable to the pain of childbirth. In the US alone, half a million people per annum attend emergency rooms for kidney stone treatment. Kidney stones are an acute and widespread problem.

The most common treatment for kidney stones is shock wave lithotripsy, in which a high energy acoustic pulse (shock waves) pulverise the stone in situ, reducing it to small pieces which are then passed from the patient's body in urine. For stones which cannot be broken up in this way, surgery is required. Currently, for around 40% of patients, repeated lithotripsy treatments are applied over several days in unsuccessful attempts to break up the stone. The patient continues to experience acute pain in this interval.

This is where the StoneChecker software comes in. Whether or not a stone will be amenable to destruction using shock wave lithotripsy depends on the position of the stone and its properties: both the size of the stone and its surface texture.

The software automatically analyses the CT scan data applying sophisticated algorithms to produce a composite score which accurately predicts whether lithotripsy will be successful.

---2017 text continues in next post ----

Pretty nice RNS today!

great news on NAV, and plans for future dividends and share buybacks. I've topped up!

I got into this share just over 5 years ago with an initial purchase at 5.5p (when it was FBDU). Have added lots more since then at a wide range of prices, and sold a few in 2019, 2020, and 2021 to wrap them for tax purposes. It's really nice to see this slow steady rise with the long-anticipated news flow as things come to fruition.