Advanced Oncotherapy Plc Delivery of LIGHT

Hardman & Co

Hardman & Co ReportAdvanced Oncotherapy Plc (LON:AVO) is focused on delivering a more affordable, novel, proton-based radiotherapy system, based on technology originally developed at the world renowned CERN. The company is entering an exciting stage with construction work on its Harley Street site expected to commence this month following preliminary assessment work. Meanwhile, individual modules for the LIGHT system are being integrated and tested in Geneva. At the March 2017 investor presentations, AVO provided a revised timeline for completion of the London Proton Therapy Centre, first patient treatments, and an update on its commercial and financial strategies.

Strategy: To develop a compact and modular proton therapy system at an affordable price for the payor, financially attractive to the operator, whilst generating superior patient outcomes. AVO benefits from the technology know-how developed by ADAM, Geneva and relies on a base of world-class suppliers.

Timeline: A revised timeline has been provided showing a clear pathway for installation of the first LIGHT system at Harley Street. Excavation work will commence by April with construction expected to take 62-96 weeks, followed by fit-out.

Key milestone achieved: Meanwhile, the technical aspect is progressing at ADAM with a key milestone announced at the Investor meeting on the 6th March 2017 – the proton beam has been successfully fired through the RFQ at 5MeV, which is the exact requirement of energy acceleration of this component.

Partnership: The relationship with Thales is the key driver of success for full commercialisation of the LIGHT system. A facility for two production lines is being developed at Thonon, bringing a manufacturing capacity of eight machines per year when fully operational.

Commercial: The Harley street project is independent of the commercial success of the LIGHT system, as it bears its own challenges. Independently of the timetable of the Harley Street site, AVO is in active discussions with multiple partners, potential customers and distributors across the world.

Risks: Construction work in a listed area of London has some challenges. More validation work is needed on the LIGHT system, which is mitigated by the know-how of the ADAM team and the Thales partnership, and provides a strong base for commercialisation of the technology. The main risk is that of execution.

Investment summary: Demand in Proton Therapy is increasing worldwide and the need for a small, flexible, affordable and close-to-patient machine is desirable. Advanced Oncotherapy Plc has attracted strong partners and discussions with potential customers have already started. Attention is focused on the construction timetable for the flagship Harley Street site and installation of the first LIGHT system. Resolution of its financing requirement is an important milestone.

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