Optiscan counts the cash in wake of Pentax deal

OPTISCAN has banked its first installment from the $AUD19.6 million Pentax endomicroscope deal announced last week.

The Melbourne company yesterday told the market it had received $AUD6.5 million from its new Japanese partner.

Under a joint venture agreement Pentax will have exclusive global rights to market Optiscan's high-magnification flexible endomicroscopes, in a deal described by Optiscan managing director Peter Delaney as a "company maker".

The technology, expected on the market within 18 months, is intended as a superior diagnostic and management tool for diseases including colon, mouth and gastric cancer where abnormal tissue is easily missed.

It is hoped the flexible endomicroscope will be able to look at more tissue than can be examined in a biopsy, with the ability to zoom in at the cellular level.

Under the terms of the agreement, Pentax' first payment will be followed in April by a placement of 3.33 million ordinary shares at $AUD1.96 to increase Optiscan's cash flow by a further $AUD6.5 million.

On completion of the engineering development phase, during which time Pentax will integrate Optiscan's proprietary imaging technology into its own flexible endoscope system, the Australian company will receive a further $AUD6.5 million.

Optiscan will also be entitled to undisclosed royalties, which have been agreed to with Pentax. Optiscan's rigid endoscopes and hand-held skin endoscopes are not covered in the agreement.

The global market for flexible endoscopes in 2001 was US$ 840 million per annum.