Digirad Corp.(NSDQ:DRAD) handed over several on-the-shelf and in-development devices to Novadaq (TSE:NDQ) in a $2 million deal that includes 5 pending patent applications and the rights to 13 existing technologies.
In addition to buying up Digirad’s patented surgical lymph node and tumor margin imaging systems, Novadaq took a gamble on the promise of the "Trapper" technology, still in development. Trapper is a surgical camera that uses radioisotope tracers to create 2D imagery for cancer diagnosis, a technique called scintigraphy.
Novadaq is slated to take the device all the way through the FDA regulatory process and has promised to shell out a possible additional $1 million if Trapper turns out to be a lucrative product. In the purchase agreement Novadaq promised to hand over $500,000 if the device wins FDA 510(k) and an additional $500,000 if it brings in more than $750,000 in net proceeds.
The contract also covers royalty payment for different Trapper parts for 5 years after the 1st sale of the device, if it is FDA-approved.
Novadaq touted the Trapper’s promise in a press release, with CEO Dr. Arun Menawat stating, "By providing scintigraphy and SPY Imaging technology, our goal is to enable surgeons to not only visualize perfusion and blood flow in vessels, but to also visualize lymph nodes and tumor margins in deeper tissue, all at the same time, in the same patient, in real-time, in the surgery suite."
Digirad has been going through some serious trimming-down efforts lately, with brand new CEO Matthew Molchan guiding the company through a number of layoffs and an overall restructuring of its primary imaging business.