A company created by Australian entrepreneur Maurie Stang and a team of American scientists has scored significant investment from a raft of renowned Australian business identities, as it looks to commercialise what it describes as the biggest breakthrough in X-ray technology since it was created in the late 1800s.
The venture known as Lumitron Technologies was founded four years ago by Mr Stang and the former chief technology officer of renowned US science and security laboratory Lawrence Livermore National Laboratory, Dr Chris Barty.
It is commercialising an X-ray technique developed within Lawrence Livermore, in conjunction with the SLAC National Accelerator Laboratory at Stanford University, which utilises a new type of high-energy laser light source (known as Laser-Compton) to recreate the power of a billion-dollar synchrotron, but in a device the size of a modern CT scanner that will cost a fraction of the price.
The company, which has received a letter of support from global corporation GE, has raised $US25 million ($33.6 million) from
investors including former Macquarie Bank boss Allan Moss, Origin Energy and OFX Group board member Steve Sargent (who has also joined the Lumitron board), business consultant to ASX 200 companies John Egan, as well as other affluent Australian businessmen and local and US radiologists, who make up about 20 per cent of the raise.
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The Lumitron Hyperview operates at 1000 times the resolution of a traditional X-ray machine. Supplied
Lumitron is still in negotiations with some foreign investors, which could further increase the size of the funding round.
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The images created by the Lumitron Hyperview machines have 1000 times the resolution of a traditional X-ray. Mr Stang explained that if an X-ray were used to image the Golden Gate Bridge in San Francisco, a traditional machine would show up just the outline of the bridge, while Lumitron would be able to identify the type of upholstery used on a car seat in a vehicle driving across the bridge.
Medical application
The company claims its machines will be able to replace traditional X-ray and CT scanners in hospitals and identify problems such as tumours in far more detail.
In addition, it said, they would have ultra-low radiation compared with today's machines and theoretically be able to treat a tumour with precision radiotherapy at the same time as imaging it.
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Former Macquarie Bank chief executive Allan Moss is one of the Lumitron backers. Peter Braig
The start-up has taken four years to get off the ground thanks to negotiations with the US government to have access to the intellectual property.
Mr Stang, the chairman of
ASX-listed medical tech company Nanosonics and founder of investment firm Gryphon Capital, who has taken on the role of executive chairman, said he hopes to have a Lumitron machine in every university within five years.
Making machines
"We believe that within three to five years we will get the cost of the machines down to a point where they can go into high volume in all markets," he told
The Australian Financial Review.
"We will currently break even on just one machine sale a year. With most high tech companies, the closer to market they are, the more money they require, but we're the opposite. Our commercial spend now is really only on components, staff, awareness and marketing.
"Our priority applications will positively impact the environment and human health … and there will be a significant social component to it. A Third World country couldn't buy a synchrotron, but they can afford a Lumitron."
Lumitron says its X-ray technology will have commercial applications in "virtually every field of human endeavour", according to a pitch deck seen by the
Financial Review.
The $US25 million capital injection will be used to commercialise the technology and comes before an expected listing on the NASDAQ in the first quarter of the 2021 calendar year.
US government deal
More than $US200 million has been spent on the creation of the technologies and components underpinning Lumitron and while the company was founded only four years ago, the commercialisation of the business is the result of 17 years of research.
In July last year, Lumitron received exclusive commercialisation rights for the life of the laser technology patents in every field, except for certain defence applications, which have non-exclusive rights.
Under the terms of the deal and in line with US government policies for government-funded commercial partnerships, 80 per cent of the firm's investment in development needs to be made in the US until a liquidity event, such as an IPO.
The company will be based at the University of California, Irvine, but a significant balance of the remaining development spend will be made in Australia.
Australian-led investment
"We have an Australian team of negotiators … and we had to negotiate line by line, patent by patent, and the terms of what contribution this would make to American technology society and then also globally," Mr Stang said.
"The US government has spent millions on it, so they wanted to ensure the main investment in people and science jobs would occur in America and I didn't have a problem with that, because that's where the expertise is."
Local firm Clinton Capital Partners was the lead manager for Lumitron's latest raise and principal Randolf Clinton, who is the former JPMorgan and RBS Global Banking managing director, said it was one of the most unique and exciting deals he had worked on.
As well as medical imaging, the technology could have major implications in fields such as mining and energy, potentially leading to improvements in nuclear power, as well as battery storage.
Mr Stang said the Lumitron's ability to "tune into the frequency of anything in the periodic table" meant that it, in addition to imaging a metal or substance, could tell a technician how pure it was and what other substances were mixed in.
The Lumitron is expected to be ready for commercial use within 18 months.
"It will be used experimentally in universities within two years," he said.
"It's really game changing. If 10 per cent of universities adopt this, then it's a $10 billion market just to start with."
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