Commercial Launch of Groundbreaking Vascular Disease Intervention Product

January 25, 2012 - Toronto, ON - TSX News reports that The Medipattern Corporation (TSXV: MKI), a pioneer in the development of medical imaging software solutions that help medical practitioners to better understand lesions and critical anatomy has become an investment in focus as industry peer CardioComm Solutions, Inc. (TSXV:EKG) recently shot up tenfold on heavy volume, per the buy recommendation from TSX News early this week.

Similar to EKG, MKI had their patented vascular disease early detection medical device and software approved for sale by the FDA. MKI received approval for their Visualize:Vascular™ product 11 months ago, which resulted in their stock price increasing from 5.5 cents to as high as 84 cents in the two days following the release. Since MKI gained clearance by the FDA nearly a year ago, they are that far ahead of the curve vs. EKG with respect to the marketing and sales of their groundbreaking product. Read the full release here:

Medipattern's Visualize:Vascular™ Now in All Three Major Vascular Market Sectors

The company is set to have strong revenue growth and cash flow in their upcoming quarterly results as they implemented their software and equipment in all three of their target markets of vascular surgery, cardiology and radiology in late 2011 throughout several medical practices across the Northeastern United States. The necessity of Visualize:Vascular™ for the early detection and prevention in heart disease and other vascular issues are described in the company's December 22, 2011 MD&A documents listed on SEDAR:

"Visualize:Vascular™, the initial product in the company’s vascular strategy, is now FDA cleared. The goal of a modest product launch during the summer of 2011 and a full commercial release in the fall of calendar 2011 is now well underway.

Vascular disease is the number one cause of morbidity in the world today and is the number three cause of death, with heart failure as number 1 and cancer as number 2. Patients with vascular disease are also linked as high risk candidates for heart failure. The goal of Visualize:Vascular™ is to try to identify the patients that would benefit from early intervention and treat them with medication before a blockage develops, or a piece of plaque breaks away leading to a stroke. Visualize:Vascular ™ focuses on the active lumen by segmenting it away from the tissue and renders it in 3D from an ultrasound CINE loop. This software product is loaded onto an independent workstation which receives ultrasound images in DICOM format from any ultrasound manufacturer and generates reports on the vessel structure which can be printed or sent to PACS via several DICOM formats. 

Medipattern developed Visualize:Vascular™ for use with Common Procedural Terminology (“CPT”) code 76377 for 3D rendering of ultrasound imaging. Medical necessity was established in the paper presented at the Society for Vascular Ultrasound Meeting (SVU) where it states that a patient undergoing a Carotid Duplex Exam (CDE) may qualify for using the 3D rendering procedure (Visualize:Vascular™) if the patient presents with these concerns: Stenosis >50% as measured using CDE, visible plaque during CDE, tortuosity during CDE or has had a previous surgical event where follow up for re-stenosis is a concern. 

While there are some forms of 3D tools on ultrasound platforms, none to date render the region of interest as a specific target volume lifting just the area of concern away from the rest of the data volume so that the user can manipulate on screen only the area of concern in 3D."

Despite the tremendous progress made by the company throughout 2011, culminating in the successful launch of Visualize:Vascular™, the stock gave back most of the gains seen in February as impatient short-term traders and tax loss sellers dumped the stock. While MKI passed 80 cents on speculation of some indefinite revenue timeline, it now sits under 20 cents despite the successful commercial launch of Visualize:Vascular™ which will result in definitive revenue for their next financial release.

Visualize:Vascular™ is not the only product Medipattern has in their pipeline. Their Cadenza™ Platform received extended patent protection for kinetic studies and combining imaging techniques. This patent solidified Medipattern's position as a globally recognized leading edge developer of medical imaging analysis tools. MKI has used the Cadenza™ algorithm platform to collaborate with GE Healthcare in order create Ultrasound-based Vascular Imaging Quantification Tools, aiding in the analysis of vascular disease and improving the speed and accuracy of diagnoses. Medipattern's relationship with such a large health care partner creates the possibility of it being a potential buyout target by that partner, especially since MKI has successfully launched another product in their pipeline.

Given the complex nature of their technology it is difficult to come up with a revenue target for MKI, unlike EKG. However, the company has only 57.4M shares, 2.6M stock options and no warrants outstanding, leading to a market cap of less than $10M when the stock is valued at 17 cents. Given the company's working capital of over $2M and immediate revenue potential of the Visualize:Vascular™ commercial launch, the need for dilution is slim as the company continues to grow.

Despite EKG being highly undervalued, it is strongly recommended that you allocate some of your gains to MKI as both will lead they way in innovative solutions to the early detection and prevention of heart disease, with MKI being a step ahead in terms of revenue timeline. Given the positive direction  Medipattern is headed, 84 cents is easily achievable as the new base price for the company going forward.

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