Sonic Healthcare signs 3-year contract

Yesterday, Artrya announced that it had signed a 3-yearcontract with Sonic Healthcare to use Artrya’s Salix Coronary Anatomy (SCA).While the contract won’t contribute significantly to Artrya’s revenue, itprovides another proving ground for Salix, lending more credibility with UShealth systems (groups) as Artrya looks to expand relationships beyond itscurrent 3 US partners.

2nd largest radiology provider: Sonic Healthcare isAustralia’s 2nd largest diagnostic imaging provider, with 125 radiology centresnationwide.

Revenue: The contract will commence generatingrevenue in 4Q25, albeit we expect the contribution to be modest as Salix isprogressively rolled out across the ~30 cardiac imaging centres (Venn Brownestimates it could ramp up to ~$500,000 a year by FY26). See Figure 1for our forecast revenue breakdown.

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The US will provide around 96% of Artrya’s revenue‍

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Optimise integration & rollout: The contract willprovide Artrya with another opportunity to optimise its integration and centrerollout as it expands its partnerships in the US.

Artrya’s 5th contract: This is Artrya’s 2nd contractin Australia after it signed The Cardiac Centre NSW mid-2024, and its 5thoverall, having already signed agreements with 3 US providers (NortheastGeorgia Health System, Tanner Health, and Cone Health), which combined weestimate complete around 20,000 CCTA scans a year. While we expect Artrya tocontinue growing its client base in Australia, the focus will remain in the US (seeFigure 2).

SCA is the first step: As an imaging and workflowtool, SCA is Salix’s entry point into an imaging centre. Most of Artrya’srevenue will be generated from its plaque assessment (Salix Coronary Plaque)and flow assessment (Salix Coronary Flow) tools, which in the US are eligiblefor government rebates of US$950-1,000 per scan.

Artrya expects to commence the FDA approval process for bothSCP and SCF this year, with approval before the end of the year. Venn Brownestimates assume FDA approval is achieved mid-2026.

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Figure2: Artrya’s expected customer rollout will remainUS-focused

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$15 million placement

On Tuesday, Artrya launched a $10 million capital raise(pre-raise market cap of $78 million), with the ability to accept overs. VennBrown understands demand was high, with the book closed yesterday, havingraised $15 million with demand exceeding this. The raise will be completed intwo tranches, with the second tranche needing shareholder approval.

 - Price: $0.73 per share

 - Discount: 15% from Monday’s close ($0.86)and 13% discount to 12-day VWAP ($0.843)

 - Total raised: estimated $15 million

 - Use of funds: ‍

           o  Accelerate regulatory applications for SalixCoronary Plaque (SCP) & Salix Coronary Flow (SCF)

           o  commencing a plaque study to support broadclinical credibility

           o  clinical studies and R&D

           o  customer implementation

           o  regulatory costs

           o  working capital

The placement was somewhat unexpected but was opportunelytimed to leverage the +300% increase in share price seen over the last 6months. The additional $15 million should give the company at least a 15-18month runway, with the burn rate expected to increase modestly as managementlife rollouts and marketing activities, along with accelerating FDA approvalactivities and the launch of a new plaque study, which will lift the group’svisibility and credibility amongst US (and global) healthcare providers.

The next news will be Artrya’s submitting its reply to FDAquestions, which we expect the company will do by early March, followed by FDAapproval for SCA by the end of March. FDA will immediately trigger thecontracts with existing US providers to become revenue-generating.

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Catalysts

As discussed in our initiationof coverage report, we see several catalysts that will progressively seeAYA’s share price more accurately reflect the company’s fair value, including:

 - FDA clearance (expected 1Q 2025);

 - reporting its first revenues;

 - the launch of US sales activities;

 - further FDA regulatory approvals in 1H26;

 - launch of Salix Coronary Plaque; and

 - Salix Coronary Flow and ongoing US customerwins.

Read more in ourinitiation of coverage report: ‘Salix:The future of cardiac imaging diagnostics’.