Chief executive Dave Darling said some LCDs took five years. Cxbladder won't get it within the next month, but strong clinical support for the company's tests mean it should "probably" happen inside a year.
"It's getting very close."
Pacific Edge shares rose 6.1 per cent to 21 cents yesterday, trimming their loss this year to about 39 percent.
Pacific Edge has made good ground in New Zealand with its test products, which offer a simple and low-cost screening method for bladder cancer, reducing the need for costly and invasive cystoscopies.
Eleven of the country's district health boards – covering about 62 per cent of the population - have already adopted the tests and the New Zealand business is expected to be cash-flow positive this year.
The firm also has trials underway with hospitals in Australia and Singapore.
Pacific Edge's losses narrowed last year but commercial success in the firm's prime target – a potential US$1.2 billion market in the US – still remains just out of reach after five years' effort and $130 million of investment.
Pacific Edge raised $12 million from investors last year and had about $12.8 million in the bank at the end of March.
Chair Chris Gallaher said the firm is very conscious that it is spending shareholders' money to advance its growth. It has kept a lid on costs in the US, but its monthly cash burn is likely to remain at $1.1 million, he said.
"Cash sales are up – no question," but he declined to comment on whether another capital raising would be required this year.
Darling said the company is expecting good growth in New Zealand and the national product code it received for its tests in the US has already sped up the payment cycle on sales there this year.
"We're tracking to plan" and want to get to cash-flow positive company-wide as soon as possible, he said.
Pacific Edge is targeting the largest US health institutions for contracts, given their potential volume and long-term sustainable growth.
As well as Medicare, other major bodies the firm is targeting include Johns Hopkins Medicine, veterans' healthcare groups VA and Tricare, and Kaiser Permanente.
Pacific Edge reduced its US sales force to 12 last year to contain costs, but sales growth had slowed as a result, Gallaher said. The board yesterday agreed to take that up to 16, which would still leave three lower-priority regions uncovered, he noted.
Darling cited the challenge of dealing with organisations like Kaiser Permanente, a large, integrated health insurer and health care provider which is trialling its products.
While it has more than 12.2 million members, 400 of its own urologists and another 200 external urologists, its decision-making processes are "glacially slow," Darling said.
Gallaher said getting an LCD for Medicare and Medicaid and securing a contract with a firm the size of Kaiser would be transformative.
"Our world will change fundamentally when those two things happen," he said.
About half the tests the firm did last year in the US were for Medicare patients. Once an LCD is in place, Pacific Edge will be able to negotiate reimbursement on more than 17,000 tests done to date.
"There is a significant pot there once we get that LCD," Gallaher said.
