Although the corona crisis will not pass by MDxHealth, the company got off to a good start into 2020. The figures for the first quarter were fine and in May it was announced that the American investment company MVM is investing 13 million euros in the company. Willem Melchers, executive vice president Lab Operations and MDxHealth BV in Nijmegen, explains the developments.
Like most biotech companies, MDxHealth will be showing less good business results for the second quarter of this year than initially expected. The fear of the coronavirus caused a drop in the number of patients visiting the hospital for diagnosis, check-up or treatment almost everywhere. This will also have negative consequences for MDxHealth’s operating results.
Willem Melchers, who heads the company’s Nijmegen branch on the Novio Tech Campus, expects a temporary dip that will only delay the further expansion of the company. The news in the preceding months gave sufficient cause for that confidence. In the first quarter of 2020, the results – despite the starting crisis – were still excellent. MDxHealth, which specializes in molecular prostate diagnostics, grew nearly 25 percent from $ 4.7 million to $ 5.9 million. In addition, it was announced at the end of April that the American investment company MVM is investing nearly 13 million euros in MDxHealth.
Melchers: “We are still a developing company. This development is dictated by the profit from business operations. That is why it is great that we have brought in an external investor with MVM who sees a future in this company. Traditionally, there have been mainly large investors in MDxHealth, because the roots of the company lie in Belgium. With an American investor on board, we become even more visible in the United States. That is a positive development, also because 80 to 90 percent of our people are in the US. “
Change in management
In that respect, the investment is also in line with the recent change that has taken place in the management of MDxHealth in the past period. Both the Dutch chairman of the board Jan Groen (CEO) and the Belgian financial director Jean Marc Roelandt (CFO) have left the company and have been replaced by Americans. The current CEO is Michael K. McGarrity and Ron Kalfus has become the chief financial officer. The sales director (CCO) John Bellano is also American. “The management is now indeed less European,” says Melchers, “but that also makes it interesting. Certainly from the perspective of growth, it can be a positive development. The vast majority of the company is located in the US and it can help if we have a more emphatic presence there and become more visible to important parties. ”
Acquisition of NovioGendix
The Nijmegen representation in MDxHealth has everything to do with the acquisition of NovioGendix in 2015. NovioGendix, a spin-off from Radboudumc headed by Willem Melchers (CEO) and Jack Schalken (CSO), had developed a molecular test for the diagnosis of prostate cancer in urine. For MDxHealth, this test meant an ideal addition to their portfolio. On the other hand, NovioGendix immediately gained good access to the medical market through the sales force and the marketing apparatus of MDxHealth. Both parties saw an advantage in the collaboration.
Research at Novio Tech Campus
“An important point in that acquisition was the promise that all NovioGendix employees could transfer to MDxHealth”, says Melchers. “With that, the focus of molecular diagnostics and the development of new MDxHealth products actually also shifted to Nijmegen. From our location at Sanquin, next to the Radboudumc, the research was then moved to the Novio Tech Campus. Here we have excellent lab facilities and there is the possibility to expand further. ”
Back to the old nest
After the takeover by MDxHealth, both Melchers and Schalken remain somewhat more remotely involved – as consultants – with MDxHealth. When Melchers is asked by the company in 2017 to lead the Nijmegen operations, however, he returns to the old nest. For one day a week. The other days he will remain connected to Radboudumc as a medical molecular microbiologist. Jack Schalken is also still affiliated with the Nijmegen academic hospital as professor of Experimental Urology. This shortens the lines between research and the business community and is a way in which the ‘impact on healthcare’ can be shaped that the Radboudumc advocates.
MDxHealth’s main products are SelectMDx, the test actually developed by NovioGendix, and ConfirmMDx. The first test detects prostate cancer in urine, the second test checks men with a negative biopsy to see if they do indeed have prostate cancer. Melchers: “In the US, ConfirmMDx is the most important product, but we are now going to roll out SelectMDx. In Europe we are further expanding SelectMDx and ConfirmMDx is not yet offered. To do so, we would first have to go through the entire CE approval process, which costs a lot of time and money. We are opting for further development of the products in the pipeline, with InformMDx at the forefront. A comprehensive test with which the development of prostate cancer can be monitored even better. We are also developing tests for other conditions, such as bladder cancer, and in collaboration with another company we are setting up a Point-of-Care test for prostate cancer”.
Now that the first corona wave has passed its peak, the demand for testing is also starting to pick up again. “We live in the optimism that things will be better from now on,” says Melchers. He emphasizes that MDxHealth is a healthy company with enthusiastic and motivated people, many of whom come from the Radboudumc at the Nijmegen location. “With the recent developments, I believe that we as a company can look to the future with a bright future.
MDxHealth is located in Building M of Kadans Science Partner on the Novio Tech Campus.