Digirad invested $1 million into Perma-Fix Medical, constituting 5.4% of outstanding shares and appointed Digirad CEO Matt Molchan to Perma-Fix Medical’s supervisory board.
The deal will position Perma-Fix Medical as the preferred supplier for Tc-99m resin, which Perma-Fix Medical is currently developing, to be used for Digirad’s nuclear imaging operations.
“Perma-Fix Medical S.A. has made significant progress since we began our relationship and we look forward to working closely with them to bring this transformation process to market. We believe the Perma-Fix Medical S.A. process can develop into the standard of production of Tc-99m for many years into the future,” Molchan said in a press release.
Tc-99m is the most widely used medical isotope, used in 80-85% of the 25 million diagnostic nuclear medical procedures each year in the U.S., the company said.
“We are pleased to move forward with our strategic partnership with Digirad, especially in light of our recent tests at the 4 curie level, which confirmed that our proprietary resins could withstand higher levels of radiation. This milestone has gained significant attention within the industry and we are moving forward rapidly with plans to establish additional partners involved in the supply chain,” Perma-Fix environmental services CEO Dr. Centofanti said in a prepared statement.
Development of TC-99m is generally requires the use of thermal fission at specialized reactors, the company said. Perma-Fix Medical is developing a different method of creating the isotope that can be produced using standard research and commercial reactors.
“We are pleased to have finalized our agreement with Digirad, which we believe will help accelerate development and commercialization of our new proprietary process to produce Tc-99m without the use of uranium. This new process does not use either highly enriched uranium or low enriched uranium, and therefore addresses the major industry challenges of the current process, including waste production, proliferation risk, and a stable supply chain. As one of the leading users of Tc-99m, Digirad is an ideal partner with extensive industry knowledge and expertise to help finalize our development,” Perma-Fix medical S.A. CEO Steve Belcher said in prepared remarks.
In March, Georgia-based Digirad expanded its geographical reach by acquiring MD Office Solutions, a mobile-diagnostic services provider focused on the Northern California market.
Under the terms of the deal, Digirad paid 610,000 common shares up front. MD Office Solutions investors could also receive up to $400,000 over 3 years if certain EBITDA targets are met.