# BZI - Brainz Instruments



## twojacks28 (11 April 2006)

The newly listed company Brainz on the ASX seems to be going very well. Their half yearly report came out and looked promising. Does anyone follow this stock??? Like to hear your opinion.


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## twojacks28 (12 April 2006)

heard today that they presented at the small cap conference in sydney the other day and was asked why GE hasnt taken them over.

what do you guys think about this?


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## twojacks28 (21 April 2006)

so no one holds them?? there is a good article about them today in the herald sun.


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## Profitseeker (22 April 2006)

can you post it?


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## twojacks28 (23 April 2006)

sure, here is a summary of the company for others first.

BrainZ Instruments is a medical technology company based in Auckland, New Zealand. BZI specialises in research, development, manufacturing and sale of innovative brain monitoring technology. The monitors are designed for use at the patient’s bedside, by clinicians, in order to guide management and treatment of the injury.


*BrainZ storms in
Fleur Leyden
21apr06*

BRAINZ Instruments, a Packer family-backed medical technology company, has posted solid maiden earnings.

The Auckland-based company, which develops and sells monitors for the detection of brain injury, listed on the Australian Stock Exchange in December. 
Former WMC Resources chairman Hugh Morgan, his son William, Melbourne businessman John Calvert-Jones, the Packer Family's Consolidated Press International Holdings and Michael Kroger's JT Campbell & Company all grace BrainZ's share register. 

It is believed that most of these early shareholders have increased their holdings since the float. 

BrainZ yesterday booked an almost three-fold improvement in revenue for the six months to February 28. 


Revenue came in at $1.9 million, up from $518,000. 

BrainZ posted a $187,000 net loss, down from $756,000. 

BrainZ's chief executive Justin Vaughan said the company had extended its distribution contract with global health giant GE Healthcare for another year, out to October 2007. 

"That really augurs well for strong sales growth in the next half of the year and then in the period after that," he said. 

"We are growing very fast and I think to try to put numbers in percentage growth terms is probably almost more trouble than it's worth." 

BrainZ's BRM2 neonatal monitors are being used in 15 countries world wide including Australia, New Zealand, the US, Britain and Canada. 

"We haven't locked up our distribution for Canada or other major markets so we'd be expecting those to occur certainly in the next couple of months," said Mr Vaughan. 

"It would be natural for us to extend those through GE although we are not obligated to do so." 

The company is also close to unveiling software which can be used to detect brain seizure. 

The product is scheduled for submission to the US Food & Drug Administration in the second half. 

Mr Vaughan did not rule out an eventual takeover of BrainZ. 

"At a more mature stage these types of companies do get acquired by the likes of GE and Philips (Medical Systems)," he said. 

"If we were in that position to make those decisions some years down the line then I guess that means we've done our job well." 

The shares, which floated at 50c, closed 0.005 higher at 54.5c.


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## twojacks28 (26 April 2006)

here is a recent announcement made by the company.


*20 April 2006

Extension of GE Healthcare Distribution Agreement*

BrainZ is pleased to announce the extension of the current agreement between
BrainZ and GE Healthcare covering the US distribution of the BRM2 neonatal brain monitor. The current agreement was due to expire in October 2006 but by mutual consent has been extended for a further 12 months through to October 2007. This extension also applies to GE Healthcare’s distribution of the BRM2 in the UK, which had been due to expire in March 2007. The UK distribution agreement term will now be aligned with the US agreement with a common expiry date of October 2007.
“The extension of the distribution agreement with GE Healthcare is strong evidence of the growing interest in the BrainZ bedside brain monitoring technology, which I expect to convert into strong growth in BRM2 sales”, commented BrainZ CEO Dr Justin
Vaughan.

Further Information contact

Dr Justin Vaughan
Chief Executive Officer
+64 9 977 8102


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## twojacks28 (3 May 2006)

i found this very interesting article about the company. take a look at the 12month price compared to the price now. also damian pethica a well known biotech researcher made interesting recomendations for share price in the future. http://moneyonline.co.nz/nzimagazine/NZIm_feb06_article.pdf 

what do you think?


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## twojacks28 (10 May 2006)

here is an interesting announcement from the company. 

*your ideas on the company wanted...*

8 May 2006

BrainZ - research presentations and collaboration for adult research
BrainZ (ASX: BZI) is pleased to announce two significant advances in its research programme.


Firstly, this week six separate research abstracts utilising the BrainZ technology were presented at the Pediatric Academy Society (“PAS”) meeting in San Francisco, USA. The abstracts related to BrainZ’s ongoing neonatal research programme highlighting how the BrainZ brain monitoring technology can assist in delivering better clinical care in neonatal intensive care units. 

The PAS meeting is a large international conference concentrating on pediatrics and neonatal care. As well as the presentation of research abstracts, BrainZ was exhibited prominently on the stand of GE Healthcare, who distributes the BrainZ products in the USA and UK markets. 

In addition to the activities at the PAS meeting, BrainZ is pleased to announce the commencement of research collaboration with the Centre for Magnetic Resonance and School of Medicine of the University of Queensland. The University of Queensland team is well regarded for its MRI and EEG research and has published and presented this research internationally. 

The partnership has received Queensland Government funding for a research project “Innovative Prognostic Neurotechnology for Stroke and Brain Injury”. The total amount of funding awarded through the Partnerships-Alliances Facilitation Program of the Queensland Smart State Innovation Projects Fund is A$99,000. A similar financial contribution to the project has been committed by The University of Queensland.

 “These two announcements indicate the strength of our current research programme”, commented Dr Justin Vaughan, BrainZ CEO. “The PAS is a major international meeting and we have been very successful both in terms of our research presentations and also the overall increasing customer awareness of the benefits of bedside brain monitoring technology. The partnership with the University of Queensland is the exciting first step for the company into adult clinical research, which will be important for our future business growth.”


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## twojacks28 (11 May 2006)

can someone help me? I am trying to find out why this company, which constantly is releasing postive announcemets seems to not move. it is a fairly low traded stock but with all the impressive announcements and the high valuation price you would expect it to be much higher then it is now.


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## pch (12 May 2006)

its probably not on a lot of people's radar due to

- everyone jumping on any stock that says they dig stuff out of the ground
- small cap - not on many fund managers radar
- biotech can have a huge burn rate
- the chart shows no uptrend
- GE buyout risk (will benefit the directors but i can't see them paying $1 a share or anything like that)

I also read the report, and although I don't hold the stock, my wife is a nurse and she is going to ask one of the surgeons what he thinks of the device as although their business is pretty easy to understand, I know little about whats so good about this device

Certainl


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## pch (12 May 2006)

I also note that they had a big revenue increase, however that is split into:

Sales 514
Interest 111
Govt Funding 469
Foreign Exchange Grants 812

The previous half year was

Sales 353
Govt Funding 165

The interest comes from the $13mil they got on the share placement no doubt. The only documentation I can find of grants at their site is this..

"BrainZ has also recently received a $1.93 million dollar grant from Technology New Zealand to be used for further development of the BrainZ brain-monitoring technology. The grant will be paid over two years, and is further positive endorsement of the BrainZ technology. "

Having said that, sales has grown from 353 to 514 some 40 odd percent.

So I guess the point I'm making is that the majority of their earnings for the last half year was not from sales of their product. 

Not knowing about how grants work. Maybe the smart investors want more evidence of sales growth? 

Because when taking the grants out of the picture, and assuming a revenue growth of 40% (same sales growth as before), but a 20% increase in earnings per share (accounting for the cost of sales), it will take a while for this company to turn a profit.

Hence why it would be good to find a neurosurgeon who can give you an assessment of the technology and its potential.


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## twojacks28 (12 May 2006)

hi thanks for that. I know lots about the product and the business. it is a very good product compared to the ones inplace now. my question is why it doesnt seem to be heading up. you did answer that in some ways. 

thanks 

twojacks


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## pch (12 May 2006)

It would be greeat if you can give a laymans explanation about this product and its potential..


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## twojacks28 (15 May 2006)

if you go to the website http://www.brainzinstruments.com/ it gives you a good explanation of the product. it is superior to its counterparts as it is portable, long term use, easier to use etc. as you can see in there announcements it is going in the right direction. it also has an interesting share register with some big names in the company. i think it has huge potential as more hospitals buy the product. so far they are meeting all their targets so it looks promising.


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## twojacks28 (25 May 2006)

i think the main reason why this stock has gone down recently and not gone anywhere is because they do not advertise. what im saying is everyone i speak to says that they have never heard of it and some that know of the company tell me that there is no one promoting the stock. personally i think if they got a media adviser or something like that the stock could increase dramatically.

thoughts?


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## pch (25 May 2006)

Its a specialist thing they are into.. so they tend to use trade shows and have GE medical flogging it for them.

So I'm not so convinced that this is the sort of product/market that needs 'traditional' forms of advertising.

Somewhat related to your point though, I emailed them asking for more clarification on the grants and how they relate to the balance sheet and got no answer. So their investor relations is either immature or non existent.


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## twojacks28 (25 May 2006)

when did you email them.


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## pch (25 May 2006)

Around the time of my post to this thread regardingthe breakdown of their revenue, trying to get to the bottom of the grants..



			
				twojacks28 said:
			
		

> when did you email them.


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## twojacks28 (25 May 2006)

do you like the stock or even hold anything in the stock?


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## pch (25 May 2006)

I do not own any of the stock. But they do seem to have a good product and their business is easy to understand.

I was just trying to apply due dillegence by seeking clarification on their revenue, because the grants are finite, and its not clear how much grant revenue they will have going forward. In addition, the interest revenue is from their funding and that will reduce over time as they spend it.

Without knowing the future impact of grant revenue, then forecasting sales growth alone doesn't paint the full picture..


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## twojacks28 (28 May 2006)

fair enough. I think its going places this company.   has a good product and is in a field where there are only a few competitors that i know of. but Brainz product is much better. It has a 12month target price of 1.50 so im hoping we I can get that.


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## twojacks28 (8 June 2006)

hear is the latest announcement.

*BrainZ Business Update
US FDA Clearance sought for Seizure Detection Algorithm*

BrainZ Instruments Limited (ASX:BZI) today announced it has lodged a submission with the United
States Food and Drug Administration (“FDA”) for its computer-assisted seizure detection
algorithm1. The BrainZ computer-assisted seizure detection algorithm will assist clinical staff to
detect seizure activity in “at risk” infants in the Neonatal Intensive Care Unit. It will be sold as an
upgrade to new and existing BrainZ BRM2 bedside brain monitor customers.
BrainZ CEO Dr Justin Vaughan says that “This additional sophistication to the BRM2 capability
further differentiates the BrainZ technology and adds a much-needed and highly valued additional
resource for those clinicians and support staff involved in managing at risk infants.”
BRM2 monitors are currently in use in 16 countries around the world, mainly within Neonatal
Intensive Care Units. In Australia, units retail for $25,000. BrainZ reported half-yearly sales growth
of 29% in its most recent investor update.
“Over the past quarter we have experienced strong sales growth and the seizure detection
capability feature will further increase the BRM2’s desirability catalysing further growth for BrainZ.
In terms of worldwide sales, the past three months has seen 31 BRM2 monitor sales compared to
25 in the previous six months and 5 in the same period last year. The sales delivered in the last
quarter include our first into South Africa, which is a market of considerable potential,” Dr Vaughan
added.
The BRM2 offers valuable insights into the neurological status of at risk infants and affords clinical
staff better information upon which to base patient management and treatment decisions. There is
limited but active competition to the BrainZ BRM2 in neonatal intensive care units but none of the
available competition is able to provide any form of automated seizure detection capability. The
addition of the computer-assisted seizure detection algorithm to the BRM2 would provide an
immediate additional point of difference over the current competition.
Dr Vaughan stated, “The addition of a seizure alarm system adds significant clinical utility to the
BRM2 monitor and considerably enhances the value proposition to our customers. It is a quantum
leap in terms of technology advancement. Also, the seizure detection method provides BrainZ with
a core technology platform to springboard into wider markets, including adult areas.”
1 510(k) Pre-Market Notification is being sought
The data supporting the seizure detection algorithm has been presented at multiple international
medical conferences over the past 18 months. The data presented indicated that the BrainZ
seizure detection algorithm had higher sensitivity, higher positive predictive value, higher
correlation, and a lower level of false positive detection than two other recognized seizure detection
algorithms. The latest presentation was made to the Pediatric Academic Societies’ meeting in San
Francisco in May 2006.
Dr Vaughan states that “The data behind the seizure detection system is extremely robust,
particularly its low rates of false positive detection which is critical for effective use within the
intensive care environment.
The fact that many of the world’s leading neonatal units are lining up to trial the algorithm is
testament to the attractiveness of the technology and the buzz associated with it throughout the
international community. The process from here is that we shall select leading centres for beta
testing of the seizure detection system and aim for full commercial release in the fourth quarter of
2006.”
Dr Vaughan advised that BrainZ had recently completed an extensive survey of all Australasian
neonatal customers. 100% of respondents indicated that the BRM2 monitor was benefiting the
management, treatment and care of their neonatal patients.
About BrainZ Instruments Limited: BrainZ is a New Zealand based medical device company
specialising in bedside brain monitoring technology. BrainZ listed on the ASX in December 2005.
BrainZ has filed for patent protection of the novel methodology behind the seizure detection system
in multiple international territories.
About FDA 510k: Section 510(k) of the US Food, Drug and Cosmetic Act requires device
manufacturers to notify FDA, at least 90 days in advance, of their intent to market a medical
device. This is known as Premarket Notification - also called PMN or 510(k). It allows FDA to
determine whether the device is equivalent in terms of safety and effectiveness to a legally
marketed device.


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## twojacks28 (8 June 2006)

this is also very interesting if you would like to hear about the company.

*
AUDIO BROADCAST – BZI – Introduction to BrainZ Instruments*

BrainZ (ASX:BZI) wish to inform the market of an audio broadcast with Dr Justin Vaughan,
Chief Executive Officer who will be giving a general introduction to BrainZ Instruments.
The presentation is available at www.boardroomradio.com at 11am (AEST) on Thursday June
8, 2006 - the presentation will also be archived at www.boardroomradio.com for future ondemand
listening.


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## twojacks28 (2 July 2006)

Here is a very promising report from the company.

*BrainZ quarterly sales growth up 120%*

BrainZ Instruments Limited (ASX: BZI) today announced strong quarterly sales
growth for the period ending May 2006. “During the past 3 months, total product sales amounted to NZ$668,000” commented Dr Justin Vaughan, Chief Executive Officer of BrainZ.

“This is an increase in sales of over 120% compared to the previous quarter and over 450% greater than the same quarter last year. This sales growth, which is in part due to an increase in our distributors demo stock levels, is very encouraging and a good sign of the increasing global adoption of the BrainZ technology.”


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## Redfaces (9 August 2006)

I have hopped into this one in the last few days.

Since listing in December, Brainz has not put a foot wrong and looks to have significantly derisked with sales having picked up exactly in line (actually. . . slightly in front of) JT Campbell expectations from the time of the float.

This one could easily move 40% on only a little bit of news.  With a capitalisation of $30 million, and $10 million cash at bank. . . . it certainly is not overpriced if it delivers on its potential.

The question for anyone thinking about buying right now is whether there is much stock available at current prices.  I have taken out everything sub-51 cents in the last few days. . . . the question is whether there is more stock available off screen.  This should become clear in the near term.

I suspect that there is a bit of stock avaialable in the 50s. . . . but could dry up very quickly on news.  Next date for news will be cashflow statement at end september.  This should look great compared to the last one as we know that cash from sales in the quarter to May was deferred to the August quarter.  Suspect that August will still show a cash outflow. . . . but that this will change by early 07.


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## twojacks28 (9 August 2006)

your right. it is a great stock however it has a small turnover of stock each day. most days there are 1 or no trades. it has a recommend price high for $1.50 but only a few people who were able to get the report saw the research reports. the funny thing is those who were able to see it were mostly all the investors already in the company. you had to prove that you were a sophisticated investor to get your hands on a copy. currently the stock is way underpriced in my opinion and I think that over the next year it will pick up big time. especially as it is a possible takeover target by GE in the near future.


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## Redfaces (9 August 2006)

Twojacks. . . i never like to rely on small tech-style companies being taken over by their big relationship partners.  you can grow old waiting for it to happen. Just look at ADA - for at least eight years people have been saying "buy now - it might get taken over by Lockheed Martin tomorrow".

to GE, BZI is just another product supplier.

therefore, while a takeover by GE is ALWAYS possible, BZI will either make money for us on its merits. . . or not.

also. . . .don't get too sucked in by price targets.  while i have huge respect for pethica, it is easy to find a broker who will put a big price target on almost any biotech that is rolling out a new product. the maths is so easy. . . . if it achieves market share of x%, the company is worth $y per share.

BZI is still to achieve successful rollout. all that we know at this point is that the company has achieved sales of 10 units per month in recent months.  This is in keeping with expectations at the time of the float.

IF the company makes the next "step up" in growth to, say, 20 units per month in FY07 we can say that the company is one step closer to creating real value.  HOWEVER, it will only be when the company is reliably selling, say, 50 units per month that you can be confident that the company is worth a whole lot more than today's trading price.

if you are looking for Pethica's original 17 page report on the company it is available. . . .someone posted it on the BZI thread in another chat site.  I found it compelling. . .. but you have to realise (as does Pethica) that BZI remains SPECULATIVE.


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## twojacks28 (9 August 2006)

totally agree with what your saying. I was just stating what he has said. can you send me a link of that other forum to BZI. in reference to the GE takeover I am not waiting for it to hppen. it was apparently said that this would open new doors for GE compared to other products which they supply.


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## rub92me (11 January 2008)

Biggest gainer on the ASX today. Up 77.3 %, and all it took was AUD1950.00 :. How's that for an outstanding breakout


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