Theralase Technologies Inc (CVE:TLT) is to go back to the drawing board with its TLC-2000 therapeutic laser device that heals tissue ailments.
The company has released a number of positive updates recently regarding its highly promising Photo Dynamic Therapy technology, which is being tried out on patients who have non-muscle invasive bladder cancer (NMIBC), but its bread-and-butter product suite is the TLC series, where cold laser technology uses light to penetrate tissue to promote cellular regeneration at the source of the injury.
The TLC-2000 represented a significant improvement on the successful TLC-1000 model, and the company had high hopes for it but it has had to temper optimistic sales expectations.
In a trading update on Tuesday the company said it had achieved slower than expected sales growth of the TLC-2000.
WATCH: Here’s how it works
The company does not expect to hit previously issued sales guidance of US$10mln in 2017 or the target of US$50mln within five years of launch.
In response to the disappointing sales, the company plans to optimize the TLC-2000 technology this year and next.
The TLC-2000 software, firmware and hardware will be redesigned to allow the implementation of a recurring revenue model over a large-scale distribution network.
Theralase expects to complete this overhaul next year.
The company also plans to make regulatory submissions to Health Canada and the US Food and Drug Administration to expand the scope of the current clearances for use of the product beyond chronic knee pain.
The new clearances, if received, are not expected until next year.
In the first three months of the year Theralase’s total revenue rose to C$507,428 from C$411,448 in the same period of 2016.
In Canada, revenue increased 79% to C$322,186 from C$180,069 but in the US revenue decreased 7% to C$141,714 from C$152,375 while international revenue decreased 45% to C$43,528 from C$79,004.
The loss for the period widened to C$1.47mln from C$1.15mln.
The increase in net loss was primarily due to increased investment in research and development of the TLC-3200 Medical Laser and TLC-3400 Dosimetry Fibre Optic Cage (DFOC) related to the support of a Phase Ib clinical study for NMIBC, and to sales, marketing and administrative personnel initiatives, related to achieving the successful commercialization of the next generation TLC-2000 therapeutic medical laser system and the successful launch of its recurring revenue model.
READ Theralase to expand bladder cancer trial after initial success
The company said selling expenses are expected to increase in the future as it ramps-up its sales effort.
The company ended the first quarter with cash of C$1.60mln, down from C$2.97mln at the end of 2016.
Shares in Theralase were off 13.4% at C$0.355 in mid-morning trading.