Ilika plc (LON:IKA) Chief Executive Officer Graeme Purdy caught up with DirectorsTalk for an exclusive interview to discuss the successfully commissioning of its Stereax batteries at Cirtec, product qualification, customer interest, commercial benefits, and news to monitor in the future.
Q1: Ilika has just confirmed that its Stereax equipment has successfully commissioned at Cirtec Medical Facility in the US. Is all of the equipment now ready to start production of Stereax batteries?
A1: Yes, that’s right, that’s exactly really what we’ve announced today and it’s news I think a lot of our stakeholders have been waiting for. So, it’s a proper big bang to start 2025.
So, the way it’s set up is that actually Ilika has retained some of the equipment here in the UK so for example, we make the cathode, which is the positive electrode in the Stereax batteries here in the UK and then ship that out to Cirtec for further processing. All of the equipment for the other layer deposition and backend processing, so the microfabrication of the batteries, is now installed at Cirtec Lowell facility in Massachusetts in the US.
Some of the processing is still outsourced. So, we are working with outsourced partners and then the batteries actually are shipped back to the UK for us to form and test them, make sure they’re working before they go out to customers.
So, I guess the starting pistol has been fired on process qualification.
Q2: How long will product qualification take?
A2: The next step is actually that we run the process from beginning to end and we start making products. Of course, the first product that comes off the line is unlikely to be perfect, so we need to test the quality, make sure that the product meets specification. When products do meet what we print on the spec sheet, then it can be released to customers.
So, we are expecting to release product to customers later on in 2025.
Q3: Why are customers interested in Stereax?
A3: Well, the thing that they get excited about really is the combination of the miniaturisation of the technology, together with the energy density and power density. So, these batteries are thin-film batteries, they have a really high-power density, which means that you can pull the energy out of the battery very quickly. This is really good for delivering pulses of energy to the electronics that you are powering, which can be really useful if you want to communicate with an external device.
So, say you’ve got a sensor that’s an implant and you want to transfer that information via a Bluetooth chip, via a Bluetooth transmission, then you actually need quite a bit of power. You need a pulse of power in order to power that chip and Stereax batteries are really good for that.
Of course, you know, when you in general have got a surgical intervention, you want to make sure that the components that are being implanted into the patient are as compact as possible, and that’s one of the attractions of the Stereax design.
Q4: How will Ilika and Cirtec Medical share the commercial benefits?
A4: Well, look, we entered into a 10-year licensing agreement with Cirtec in 2023. We’ve been installing the equipment in the course of 2024 and now we’re qualifying the products ready for release.
When that product is sold, we’ve got a licensing agreement in place, which ultimately will result in a royalty of product sales being paid through to Ilika. So, both Cirtec and Ilika are perfectly aligned in terms of the commercial incentives.
Q5: What should we be looking out for in terms of news to monitor progress?
A5: So, news that you can look out for would be confirmation that products are meeting the quality requirements and meeting the spec sheet. Also, we will, of course, announce when shipping of products starts to customers.
Ultimately, we will be reporting the first revenue that we recognise from the product commercialisation associated with this activity. Because that’s why we’re in business, to create products that are useful to people and make money.
