ImpediMed (ASX:IPD) outlined progress across its SOZO digital health platform during a quarterly update call, while acknowledging a softer-than-expected U.S. sales quarter for its breast cancer-related lymphedema (BCRL) business. Management said it remains focused on converting a large sales pipeline, expanding reimbursement, and accelerating growth initiatives in heart health and wellness and weight management following the launch of SOZO Pro.
Quarter highlights: reimbursement gains, product milestones, and mixed sales
Management said the company has made “a lot of progress” positioning SOZO and the new SOZO Pro across three market segments: BCRL, heart health, and wellness and weight management. While “rest of world” sales were positive, the company described U.S. BCRL sales as “disappointing” for the quarter, citing delays in hospital contract approvals due to budget constraints.
On the reimbursement front, management said national coverage for BCRL-related reimbursement has reached 93%, representing 323 million covered lives—an increase of 5% from the prior quarter. Management said reimbursement is increasingly central to hospital purchasing decisions and reiterated its view that SOZO-enabled BCRL programs represent a revenue-generating service line rather than a cost item.
FDA and regulatory updates support new use cases
ImpediMed said it received FDA clearance “this morning” for a new bilateral lymphedema algorithm intended to help physicians monitor a subset of patients at risk of bilateral lymphedema.
The company also said it filed a new 510(k) submission on Monday for an expanded body composition offering aimed at better targeting the wellness and weight management market as well as cancer survivorship.
Market strategy: BCRL foundation, plus cardiometabolic expansion with SOZO Pro
Management presented SOZO as addressing “three of the fastest growing healthcare needs” it identified as cancer survivorship, GLP-1 therapy, and heart failure. The company said it has launched SOZO Pro into the market, highlighting features such as inbuilt scales, an ability to measure patients up to 220 kilograms, and the removal of cardiac implantable contraindications to better address heart health and wellness use cases.
ImpediMed said it has more than 600 devices across the U.S. healthcare system, including placements in 18 of the top 25 U.S. hospitals. It also reported having 27 master service agreements with major integrated delivery networks (IDNs), covering pricing, IT, and business associate agreement approvals, which management said can make it faster to deploy additional devices.
In BCRL, the company reiterated its positioning around early detection programs that are FDA-approved, guideline-endorsed, and clinically validated. Management cited headwinds in the quarter from hospital budget pressure, wage inflation, increased costs for imported products, and reduced grants and funding for Medicaid insurance, but said it believes operating conditions for U.S. healthcare providers will stabilize in the coming year.
Management also said it is working to improve workflows and adoption through initiatives including deploying SOZO Pro in lymphedema settings (where built-in scales match existing workflow), improving the EHR interface, and building AI programs to improve customer responsiveness.
Cancer survivorship and body composition: oncology expansion and conference activity
The company said it sees an opportunity to increase penetration in medical oncology as part of a broader cancer survivorship focus. Management noted that five-year survival rates for all cancers combined have reached approximately 70%, up from 50% in the mid-1970s, and said there are 1,500 Commission on Cancer Centers in the U.S. that require a survivorship program for accreditation.
ImpediMed said SOZO fits into survivorship not only through BCRL monitoring but also by tracking body composition changes during treatment. Management said three abstracts were accepted at the American Society of Breast Surgeons (ASBS) conference, which it learned “this morning,” and said it has refined its body composition offering based on a voice-of-customer survey with medical oncologists.
Heart health and wellness: early commercial steps and market segmentation
In heart health, ImpediMed cited U.S. heart failure as a large economic burden with costs projected to reach $70 billion by 2030 (as referenced by management). The company argued that weight is becoming a less reliable marker of fluid status in a “GLP-1 world” where weight can change rapidly, and positioned SOZO as a non-invasive tool to provide fluid and body composition insights to support guideline-directed medical therapy and potentially reduce readmissions. Management said the “first heart health sales” are now in progress and that a lean, dedicated heart health team has been established to validate the go-to-market pathway.
In wellness and weight management, management said its view of the opportunity has strengthened through customer engagement. It cited more than 30,000 identified sites of care across categories such as specialty medicine, exercise oncology and rehab, weight loss clinics, wellness clinics, IV clinics, and sports medicine and research. The company said it is initially focusing on segments with an addressable market size of more than AUD 200 million. An experienced commercial lead has been appointed to manage three dedicated body composition representatives in the U.S., and management said the team has identified more than 3,000 leads and is working to validate and convert them through direct sales.
ImpediMed also announced the launch of a revamped corporate website and a new wellness microsite intended to support growth in these areas.
Financial update: record revenue and reduced cash outflow
CFO McGregor Grant reported operating cash outflow of AUD 2.9 million for the quarter, down from AUD 5.6 million in the prior quarter and slightly better than management’s forecast. He attributed the improvement to higher cash receipts (AUD 3.8 million), the non-recurrence of a one-off payment for long lead-time electronic components, and receipt of AUD 1.2 million related to an R&D tax incentive.
Staff costs increased to AUD 5.3 million from AUD 4.9 million, which Grant said was largely due to redundancy payments during the quarter. He said financial discipline remains a core goal and that the company continues cost control efforts toward a target of reaching cash flow breakeven, adjusting the cost base as required.
ImpediMed reported a cash balance of AUD 18.9 million at 31 December, which Grant said equated to 6.5 quarters of operating cash flow. He also noted that a strengthening Australian dollar relative to the U.S. dollar had unfavorable impacts on cash and affected items such as annual recurring revenue (ARR).
Total contract value (TCV) declined to AUD 4.1 million from AUD 4.7 million, which Grant attributed to fewer devices sold and fewer contracts up for renewal compared with the previous quarter. He highlighted price increases on renewal averaging 14% for the quarter.
Revenue was a quarterly record at AUD 3.9 million, up 18% year-on-year and 8% sequentially. Grant said “rest of world” revenue increased 67% quarter-on-quarter, driven by the Australian distributor ordering SOZOs and SOZO Pros ahead of expansion into the Australian heart health market. Customer cash receipts increased 12% quarter-on-quarter to AUD 3.8 million. The company also said patient testing volumes continued to trend upward, increasing 1% versus the prior quarter, while noting seasonal impacts from Thanksgiving and Christmas.
Q&A: commercialization focus, competition, and sales execution
During the Q&A, management said body composition commercialization is being targeted first toward clinically supervised settings such as lifestyle medicine practices, where SOZO can provide baseline and trending data on fat mass, muscle mass, and weight for GLP-1 patients. It also highlighted interest from medical oncologists in monitoring muscle mass during chemotherapy and aligning with exercise oncology efforts.
On growth expectations, management responded that it would “hope so” regarding accelerating revenue growth beyond recent rates, pointing to the pipeline of more than 700 opportunities, a new sales team, and expected contributions from heart failure and body composition.
Addressing why budget constraints can still slow adoption despite claiming a cost-benefit proposition, management said hospitals still evaluate purchases based on allocated budgets and reiterated that it is reinforcing the “service line” revenue-generating message, aided by higher reimbursement coverage.
On competition in body composition, management described the space as “highly competitive,” naming InBody, Seca, and Tanita as established clinical devices, and referenced lower-cost consumer devices marketed for home use. It argued its differentiation is FDA clearance, prescription status, and clinical accuracy.
Management also acknowledged the quarter’s sales were “extraordinarily frustrating,” but said it has confidence in the rebuilt sales team and cited multi-system deals still awaiting final purchase order signatures. It said SOZO Pro had not been proactively marketed previously, but is now being offered and used in some cases to help close sales, including by replacing a scale in smaller breast surgeon offices.
Looking ahead, management said it will keep expanding reimbursement toward a goal of 100% coverage in BCRL, while executing go-to-market plans in heart health and wellness and weight management and maintaining cost discipline. The company also pointed to upcoming conference activity, stating there are 19 conferences coming up over the next quarter.
About ImpediMed (ASX:IPD)
ImpediMed Limited, a medical technology company, develops, manufactures, and sells bioimpedance spectroscopy (BIS) devices and software services in Australia, North America, and internationally. The company offers SOZO, a noninvasive BIS device for the assessment of lymphedema, and deliver snapshot of fluid status and tissue composition; SFB7, a single-channel, tetrapolar BIS device to analyze body composition in healthy individuals; and ImpediVET, a single-channel, tetrapolar (BIS) device that measures fluid status and tissue composition for veterinary applications.
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