Feedback plc (FDBK) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and welcome to the Feedback plc results investor presentation. [Operator Instructions] I'd now like to hand over to CFO, Anesh Patel; and Tom Oakley, CEO. Good afternoon.

Thanks very much. Hello, everyone. Welcome to this presentation. Hopefully, we will be able to answer as many questions as possible for you and give you the latest on the company and where we're heading. For those of you who don't know me, I'm Dr. Tom Oakley, I'm the Chief Executive for Feedback. Anesh, if you just want to introduce you or quickly and then I'll go through.

Sure. Thanks, Tom. Good afternoon, all. Anesh Patel, CFO, as Tom said. Great to be here today, and hopefully, we'll answer as many questions that you have as possible.

Fantastic. So I'm just going to start moving through the slides, and I can see that those are actually moving, so great. So for those of you who are not familiar with us as a company, just sort of to say briefly, Feedback plc is a specialist in medical technology. We really focus on how you can bring good quality diagnostic information to frontline clinicians, both within the NHS and more broadly within health care. And our history is very much -- we've been developing software as a medical device. We started out over 20 years ago in the field of medical imaging and very rapidly pivoted about 5 years ago when I joined as Chief Executive to address the needs of the wider clinical audience and not just radiologists who are the typical users of medical imaging. We have a couple of very impactful frontline clinical tools, the first of which is Bleepa, which is essentially a clinical-grade version of WhatsApp. It is the only communication platform available in the market that is certified as a medical device for image display, which gives us quite a unique position in the market. And in recent years, we have been able to expand the use of that communication platform to bridge the divide, not just between specialties within a hospital, but to actually look more broadly at how we can bridge the divide between different care settings. So primary care where GPs are based through to hospitals where the specialists are based. We have a number of growing routes to market. Hopefully, everyone will have seen the announcement this morning about our first extent into the U.K. private health care sector with medical imaging partnership, which will come to in a little bit. Because we address health care in the U.K. and also internationally, it's a very substantial market that we're going after, over $10 billion in total addressable market for our core products, within our core markets. So definitely a very sizable opportunity. Just to highlight, we've maintained a very strong and healthy cash balance, closing the period at $5.4 million, which puts us in a very good position to deliver the impact that we need to through our products. Just to cover off a couple of operational highlights from the period, we have been focused very much on building out the opportunity to go after larger regional contracts and pursue that opportunity to connect to different care providers. And to do that, we have had to improve the product slightly. And during the period, we released version 1.6, which included an ability to track patients across a pathway and to display that as a dashboard to, particularly pathway admins and care navigators. And what that does is it allows us to give a view of where any patient is at any given time on any given pathway, which is a hugely powerful tool when you're trying to coordinate multiple care pathways across multiple care settings. We'll cover that offer in a little bit more detail when we look at the products in a few slides. We were also very importantly, granted our import license for Bleepa as a medical device into India. For those of you who have been following the company for some time, we have been looking to engage in the Indian market for a good 18 months to 2 years now. And our original ambition was always to bring Bleepa to the Indian market because of the parallels in the needs versus the NHS sites. The difficulty we have with Bleepa is that it is a medical device. And therefore, in order to be able to sell it in India, we have to actually be able to license it in country. And there were only 2 ways of doing that. One was to actually set up our own operating subsidiary and import the product to ourselves, which is the option we elected to take. The second was to actually license it to a wholesaler in country, who could then distribute it on our behalf, but it had the downside that we would have to, therefore, hand over all of our technical information, and therefore, expose our IP. So we felt that was a risk that we wouldn't take. So what that did was delay our market entry because we have to establish the operating subsidiary, but then also had to subsequently get the import license of Bleepa. But during the period, just at the end of the last year, we actually got the import license of Bleepa, which means we can now sell Bleepa within India, which is a big step forwards for us. And it tied in very nicely with the appointment of Rohit Singh, who is our In-Country Managing Director -- who joined us from the U.K. India Business Council, where he was heavily involved in bringing U.K. companies into India, helping them to establish and then scale. So it was a very timely appointment and in the months that have happened since, he has already started to create huge impact and really elevate the presence of Bleepa within India, and we'll cover that off again in a few slides time. And Anesh, I'll probably hand over to you for this slide.

Sure. And on this slide, we've got the financial KPIs for the 6 months ended 30th of November 2023. Revenue, we reported as GBP 0.44 million, of which Bleepa-CareLocker contributed 77%. This is down 24% on the prior period, and that's mostly due to the timing of revenue recognition on the QVH pilot contract, which in the prior period included a backdated element related to 5 months, and also legacy product contracts now reaching the end of term and they comprise about 5% of the current revenue. Looking into H2, we do expect H2 revenue to be stronger than H1, and partly that's due to the NHS England pilot contracts, which we announced in December, and we'll come to a bit more detail on that a bit later. The QVH contract extension again, which we announced post period, which takes us through to the end of June at the same rate and also conversion -- expected conversion of the pipeline over the coming months. [ Useful track ] sales, which we -- which is non-IFRS revenue, representing the total value of customer contracts won in the period and that was GBP 0.41 million. Again, sales were down 33%, reflecting the lower NHS contract wins in the period. And of course, that filters through into the lower reported revenue. But similar to revenue, we expect H2 sales to be stronger than H1. Bleepa-CareLocker contributed 73% of that figure and image engineering license fees, 20%. Just as a recap, imaging engineering license fees is royalties that we collect from legacy Cadran PACS technology, which Feedback licensed to a partner in the U.S. and we'll give a bit more detail on that in a few slides time. We've stated before that we will replace the sales metric with annual recurring revenue, and we'll do so in the future once we have a bit more certainty on the 12 monthly renewals of our existing customers, QVH in particular. EBITDA loss increased to GBP 1.67 million. Again, so this is a 37% widening on the previous period, and that's driven by the lower revenue and higher OpEx in the period. The reason for the higher operating costs in the current period versus the prior period is mostly due to higher staff costs arising from headcount expansion, particularly in the sales and BD team, and that includes Roget, our new MD in India and also cost of living wage increases. Two of the components to the increase: one, being a portion of outsourced software development costs, which we previously capitalized whilst Bleepa was being developed and in developed phase. A portion of those, which being cleared from our outsourced R&D partner in Poland, we're now recognizing as operating expense, given the maturity of Bleepa. But the total spend with our partner remains consistent. Also increased consultancy and contracted costs in this period related to business development activities, which were incurred because they will be able to help us generate higher sales in the future. Tom has mentioned, the cash position remained strong at GBP 5.37 million, which is sufficient for our current needs. And that represents a net cash outflow in the period and 6 months of GBP 1.95 million, and that's due to the increase in EBITDA loss, as I've just explained, and more favorable working capital movements in the prior period versus the current period in respect of invoice signings -- sorry, invoice issuances and invoice payments from customers. Tom, next slide, please.

Brilliant. Thanks, Anesh. I think it's worth actually just highlighting it as a point to the audience. It's not unexpected for us to recognize most of our revenue in H2. It's just the way that the NHS typically procures solutions. So the NHS financial year finishes on the 31st of March. And what we usually see is peak buying activity within the month of March and the month of April because that's where we see end-of-year budget being spent and the beginning of the subsequent year budget being spent. So that is often where we recognize most of the opportunities. And we'll again come to that in a little bit. And just to pull out the sort of highlights in the post-period and to give some idea of where we might be going now. We have previously announced that there was a further extension to our pilot at Queen Victoria Hospital. For those of you who are not familiar with this pilot, we have been running the U.K.'s first symptom-based care pathway that incorporates a community diagnostic center. And we've been doing that for getting on for 2 years now with Queen Victoria Hospital. This has been a fantastic pilot site for us and it has allowed us to generate a lot of clinical evidence, which we have subsequently been able to leverage for both national and regional conversations, and to build the pipeline of opportunity for our CDC offering. The extension -- or it has delayed the decision around actually awarding the contract for the QVH pilot has actually meant that we can maintain that position and be paid for delivering against that site. We anticipate that the procurement is to close relatively soon. Hence, the extension only rolling until the 30th of June because that will cover any transitional arrangements that may be needed. And of course, as soon as we hear, we will update the market. Just to remind everyone, the reason for the delay for that procurement was because of some legal, contractual issues around the procurement in the first stage, which meant that they had to restart that procurement process, which has taken over 9 months to complete. The second thing to highlight is that having generated all this clinical evidence from the QVH pilot, we were actually invited to provide evidence to the All-Party Parliamentary Group for diagnostics around the impact of delivering pathways as part of the CDC program. And we'll come to the outcome data from QVH in a couple of slides. But in essence, what we have created is a very compelling argument that having invested over GBP 10 billion of capital investment in CDCs, the NHS has yet to recognize much of an impact on that in terms of reducing wait lists. And that is fundamentally because the diagnostic results that are being generated are not being embedded and applied into clinical pathways. And the thing that moves patient care forwards are clinical decisions, not diagnostic results. And so the thing that we now have to focus on is getting the diagnostic outputs of the CDC and take them and embed them meaningfully into the clinical pathways so that the clinicians involved can make safe and practical decisions for the patient of those results. And that is fundamentally what we have been demonstrating at Queen Victoria Hospital, is the ability to take diagnostic results, put them under the nose of clinicians, prompt them to do something about it, have a collaborative discussion with relative specialists and come up with a definitive management plan that can go straight back to the GP. The All-Party Parliamentary Group Report was published last month and is available both on our website, but also on the Royal College websites, both of radiology and pathology. And you will see that Bleepa is featured within that, both within the exec summary and within the body of a report. And what it has enabled us to do is to really have meaningful engagement from the national team, who were also present at the meeting. And the case we have made to the national team is that you've made this investment in bricks and mortar and in staffing, but you now must make the investment in the digital component that essentially glues that system into the wider health care system. And without that investment, the CDC program will not deliver the impact, but it needs to. As a result of that discussion and that engagement with the national team, we were successfully awarded GBP 300,000 of funding this year in order to undertake 2 further pilots of the Bleepa solution, one at the CDC site in Amersham and one as a pan-regional pilot across Buckinhamshire, Osfordshire and Berkshire. And that is early evidence of the fact that the national team are taking this very seriously. And what they want to see is whether we can translate the impact data that we have seen in Queen Victoria Hospital into these new settings. And if we can, that sets the precedent then for wider rollout and adoption. And then hot off the press from this morning, we have finally been put in a position where we are able to announce that one of our partnerships in the private health care space is with medical imaging Partnership. And what we have been working on with Medical Imaging Partnership is essentially to see how we can translate the pathway work that we are doing in the NHS side into the private sector space. Medical Imaging Partners are a very innovative supplier of diagnostic services based in the southeast of England. They have been trying to develop a range of clinical pathways around prostate screening, gynecological presentations and cardiac presentations. And they have been very interested and closely following the work we have been delivering at Queen Victoria Hospital. And the aim of adopting this pilot approach in the private space is, firstly, to show that you can deliver an accelerated patient journey and therefore, better quality of care to the patient within the private space, and that you can also strip out a lot of costs associated with that pathway just as we have done in the NHS. It also has a secondary impact that you can demonstrate that the private sector can deliver NHS and standard pathways at a lower price point, and therefore, will make the private sector a more attractive partner for outsourcing a lot of the NHS outpatient work. So there are 2 goals here that we are looking to demonstrate with this pilot. And again, I'll cover that in a bit more detail in a few slides. For those in the audience that are not familiar with our products, I'll just give a very quick overview. So this is Bleepa. Bleepa is our clinical communication interface. This is essentially an app that can be used on any Internet-connected device, be that mobile, desktop or tablet. It provides a common view of a patient's clinical data sourced from multiple clinical settings, so both from primary care, from where the GP is based, and also from multiple hospitals within a region. And around that common view of the patient's clinical data, we have a secure collaboration environment where different clinical stakeholders can come together to review the diagnostics and make management decisions about the patient. Bleepa is the only communication platform available in the U.K. market that is certified as a medical device for image display. And therefore, the moment that you want to demonstrate something to colleagues using either photos or x-ray radiology images, Bleepa is actually the only application that you should be using. We use Bleepa and sell Bleepa both into individual hospitals as a WhatsApp replacement to allow teams to more efficiently refer patients between specialties within that hospital. And in fact, we have demonstrated a 74% reduction in referral time at our Northern Care Alliance site as a result of using Bleepa for exactly that purpose. But Bleepa is also able to pull together stakeholders from different care settings and can bring in a GP and specialists around that common view so that we can deliver a complete end-to-end pathway. And that, hence, is the focus of the work around community diagnostic centers. And then underneath Bleepa, we have a cloud architecture called CareLocker. Unlike a traditional cloud environment where the data is pulled on mass, CareLocker is more like a bubble bath whereby we have a bubble for every patient that acts as an individualized storage locker for that patient's data that has the advantage of giving us enhanced security, scalability and also cost. Because we are able to see which patients are active or inactive in care pathways, we can move patients between different levels of cloud storage. Therefore, patients that are inactive can be stored on glacial cloud, which is extremely cheap, and then brought up to high CPU cloud as required when they enter clinical pathways and that data needs to be available for review. For those of us that have been following the company for some time, you will also have noticed that we took CareLocker on stage further, and we actually, in India, enabled patients to access their own CareLocker through a dedicated app, which we called CareLocker, which is essentially a skinned-down version of Bleepa that doesn't have a lot of the medical grade image viewing components that you would require for clinical use. But it allows us to give patients access to their own medical data within the CareLocker. And having looked at this in India and paused that opportunity because of the widespread use of WhatsApp for essentially sharing images out in India, we are actually seeing some interest in bringing this back to the U.K., given that patients are now increasingly needing access to their medical records so that they can go to different parts of the country to receive care. And of course, one of the main reasons we exist as the company is because the data flow in the NHS is not joined up enough to allow that data to be available at other centers. So unless they're using Bleepa, they won't be able to see what's happened at another hospital. So hence, why we're seeing some interest around this going forward. In terms of the key growth drivers, certainly here within the U.K., we'lll break them down by the different customer segments. So for individual trusts, that are predominantly using Bleepa for WhatsApp and pager replacement, the main driver here is around the regulatory issues and problems associated with using WhatsApp for patient communication. So the British Medical Journal have found that 98% of doctors are using WhatsApp routinely to discuss patient cases and reach decisions. It's quite understandable why because actually it's more effective and more timely for the patient if doctors can collaborate in that way. The problem comes that, that data is then stored out of the control of the NHS, and it doesn't link back to the patient's medical record, which means that decisions can be happening in a silo, that means that mistakes can then happen with the patient. So one of the core drivers around sales to individual trusts has always been the rationale for moving clinicians off WhatsApp. And last year, the regulator for this space, the Information Commission's Office, the ICO, actually made a ruling against NHS Lanarkshire and their use of WhatsApp. There was a -- 500 breaches of patient data in a year because of the clinical use of WhatsApp at that site. And what this has done is actually sent a message across the NHS reinforcing that all trusts should be getting their clinicians off WhatsApp for all patient-related comms. What it hasn't translated to yet is actual purchases of compliance solutions. It stimulated a lot of inbound inquiries, and we've entered into a lot of discussions with trusts, but the financial reality of the NHS currently means that in this financial year, there isn't an allocation to do anything. A lot of trusts have been told they have to make a 30% real-term saving in year, which meant that there's no budget left to take on priority projects like this. So what we are planning for instead is that they will be making budgetary allocations for the next financial year, but could incorporate this element. And therefore, we should be in a position to start making some sales around this post-April as we enter the new financial year. In terms of the drivers of the cross provider space or the community diagnostic space, which is our key target area, this is fundamentally around all the things that you will be seeing in the national headlines, so patient wait lists, NHS budgetary problems, NHS staffing problems. So what Bleepa allows you to do is cut patient waiting lists, whilst reducing costs and without requiring any additional staff. So we fundamentally hit all 3 of the NHS pain points and have very substantive evidence to prove that we can do this, evidence that is now being tested by these additional pilots and commissioned by the national team. And then taking it up one level to the national stage, the value that Bleepa represents to a region grows if you expand it nationally. The ability to bring specialists into any case and have patients investigated in any clinical setting gives complete flexibility to the system to allow them to match capacity and demand. You can have a cardiologist in Nottingham reviewing a case in Devon completely securely through Bleepa. And so the wider we can roll this, the broader the system impact that we can have, and that is the premise of most of the national conversations we are currently having. This is just to illustrate the sort of structure of the NHS and the fact that as you go up the ladder, the size of the organization increases and the number of organizations decrease. So we are always striving to sell to the higher tiers of this pyramid, but the higher you go, the more evidence you need and the more substantial the barriers are to getting new sales. So we typically are focusing around integrated care systems because they have the commissioning power to take on contracts across multiple trusts and multiple GPs, but we maintain that direct sales approach into individual NHS trusts, again, around that Bleepa WhatsApp pager replacement. Typically, we don't sell directly to GPs, one because of just the sheer number and also because the value proposition is really about collaboration. So bringing the GP into wider clinical conversations with other specialists. And so hence, we focus on those 2 middle tiers. I just want to spend a bit of time reviewing our existing customer contracts and some of the evidence that's coming out of those. Our most publicized evidence, of course, being around the CDC space, but we are actually also getting very comprehensive evidence of benefit from within our individual deployments. So we have been deployed at the Northern Care Alliance for many years now. In fact, Northern Care Alliance was the original pilot site for Bleepa when we first developed the product. And we have had an independent assessment done of Bleepa's impact at the Northern Care Alliance, and what this has demonstrated is essentially a 74% reduction in referral time in between specialties to a patient going from A&E to respiratory or A&E to cardiology, for example. We have also found that, that has translated into, on average, a reduced length of stay of about 1.5 days for patients, which in turn translates into quite a substantial cost saving for the organization that scales as they take it across more departments and across more clinical settings. To such an extent that actually they were to roll this across Greater Manchester over the course of 5 years, we'd be saving them in the order of about $7.7 million. One of the things that I think is also important to highlight is that 88% of staff found that Bleepa was very easy to use. This is absolutely critical to the success of the product. Bleepa is an additional overlay of existing clinical systems to which we take all the information. It has to be easier to use than those individual systems, otherwise, no clinician would engage with it. And to get that level of satisfaction is almost unheard of within health care IT, which is typically poorly designed from a clinician user experience perspective. And this evidence is actually helping us to engage with more inpatient trusts, particularly as we pick up that theme around the ICO ruling against WhatsApp and preparing to drive sales in the next financial year. We also have a long-term contract now with Royal Berkshire Hospital in Reading. The use case here is somewhat different and slightly more focused. Bleepa is predominantly used here as a method of securely capturing images of patients that are coming into the hospital, particularly out of hours with wounds, burns and dermatology lesions, things that need to be identified and captured on admission that are then often followed up as the patient progresses through a care journey. And therefore, Bleepa is also increasingly being used between the hospital and the community team as the patients move between those 2 services. Off the back of the ICO ruling against NHS Lanarkshire, we've actually engaged conversations with the trust about expanding the scope of Bleepa here to try to emulate more of a WhatsApp replacement and to engage more with the communication elements of the application. And we will update the market as and when we expand the use case here within the trust. And it's worth actually saying just before we move on to CDCs. Both the Northern Care Alliance and Royal Berkshire Hospital are examples of a growing baseline annual recurring revenue. We don't currently report ARR externally, but we do intend to as that base grows. But this is evidence of the strategy that whilst it may take time to acquire customers in the NHS, they are typically very sticky and renew year-on-year. And therefore, you can reliably use those to build a growing base of annual recurring revenue and the lifetime value of most NHS customers is therefore quite substantial. So the pain of acquisition is more than compensated for by the lifetime value and the growing base of recurring revenue that follows. So just to spend a little bit of time here. So this is the outcome data from the Queen Victoria Hospital pilot that we have been running. So this is the national flagship around how you use community diagnostic centers to deliver end-to-end symptom-based care pathways. The pathway we've been delivering at Queen Victoria Hospital is a breathlessness pathway. This is fundamentally a patient who's going to their GP experiencing shortness of breath of unknown cause. They are then immediately referred through for diagnostic investigations at the community diagnostic center. Those diagnostic outputs are then reviewed by respiratory consultant, a cardiologist and an upper airway specialist, someone like an ear, nose and throat specialist, who between them cover off all the root causes of breathlessness and can advise definitively on what the management plan for the patient needs to be. In the event that they actually require additional investigations, such as a high-resolution CT scan, they can actually additionally request that. It can then happen and come back through Bleepa and be re-presented to the asynchronous MDT, allowing them to then request additional tests and still come back with a definitive management plan. And in summary, what we have demonstrated over the 2 years that we have been doing this is a 63% reduction in patient wait times compared to the national target. We have also demonstrated an 88% reduction in the requirement for outpatient appointments. And what that translates into is an average saving of GBP 295 per patient that is going through, I believe, a pathway. The traditional model for referral will see -- you go to see a GP. They refer you to see a specialist. That specialist that request the investigations. Those investigations are then reviewed, and they see you back in clinic with the results. If it happens to be your heart and not your lungs, you then get bounced back to the GP, who then refers you through to see a cardiologist. What we are essentially doing is cutting out that first outpatient appointment and going straight to diagnosis because what we know and what we have learned from this pilot is that in about 95% of cases, the original outpatient appointment doesn't change the requests -- the investigations requested. And therefore, there's very little point in having it. You're much better off moving straight to those diagnostic investigations. And then the second step, that secondary review back in the outpatient clinic, isn't needed if we can remotely present those diagnostic data to all the specialists required and have them remotely discuss and reach the management plan for the patient. And therefore, we can save, in 88% of cases, that second outpatient appointment. And this is a double hit on efficiency for the system: one, because you now don't need a consultant in an outpatient clinic, 88% at the time; and that consultant can then instead be doing operating lists or angio lists other interventional lists that are actually designed to treat patients rather than diagnose them. So we are both accelerating the diagnostic journey and bringing in additional capacity for the therapeutic and interventional side of the NHS. So it's a double hit to the wait list reduction. And that is really the sort of compound value that adopting Bleepa brings. And hence, the argument we've portrayed to the national team that Bleepa is the digital glue that brings the CDC program into the elective recovery program and allows you to leverage all of that investment and all of the diagnostic results to drive down patient wait lists. So what has that resulted in? It has resulted in some very robust and intense discussions with the national team and then subsequently agreeing to sponsor additional pilots to see how the impact we had at QVH translates into other areas. So under the GBP 300,000 award that we received right at the end of last year, one was a 50,000 award to conduct a single pathway deployment at the Amersham CDC. This is another breathlessness pathway, but with a fundamental focus on a test called spirometry. It's an example of how we can translate some like-for-like services. And then the larger award, the $250,000 award to Buckinghamshire, Oxfordshire, and Berkshire West ICS is actually both to look at the breathlessness pathway coming out of Oxford, but actually to look at how we can deliver services more broadly at a regional level. This is a process called mutual aid, which looks at how you can leverage capacity and demand more flexibly if you have a common solution across the patch. So one of the examples that I can give you is that there are cohorts of patients in Berkshire who require an ECG. There isn't a local capacity to perform an ECG. So these patients are being sent to Oxford to have the ECG taken, but there isn't capacity to report the ECG from the cardiology teams in Oxford. So that ECG has to come back to the team in Berkshire for reporting. There currently isn't the infrastructure to do that. However, with Bleepa, you can do that completely seamlessly. It doesn't matter where that ECG has taken or who it's reported by. It's all a common view of the patient that any stakeholder within that environment can access. And as a result of that, it allows you to send patients to where you've got capacity in the system and again, help you to bring down that wait list. So those are the 2 pilot sites that are currently being evaluated. They are due to run until the 31st of March. We are -- we are somewhat unclear what will happen as the next phase, and there are 3 different options. One is that the pilot is extended. The second is that the pilot converts to a full contract. And the third is that actually we onboard additional clinical pathways as additional pilots within those regions. And we won't know which one of those 3 we're looking at until probably the end of March as this financial year closes. And of course, we will update the market once we have clarity on that position. And just taking the community diagnostic space as a whole, there are now 174 CDCs that are either operational or under construction. So this has been over GBP 10 billion worth of capital expenditure over the last 2 years in order to develop these sites. If we were to acquire a national contract or to be able to service all of these CDCs, that will actually generate about $96 million of revenue annually for us based on Bleepa licensing. So it is a substantial market opportunity and an opportunity that we are really uniquely positioned to go after. Again, Bleepa is the only collaboration platform that has that certification for medical imaging display. And if you are running a diagnostic pathway, the ability to display imaging is, of course, absolutely fundamental. And therefore, we are very confident in our market positioning and of course, also are sitting on very substantive evidence having run that initial pilot with Queen Victoria Hospital for that length of time. I won't linger on this slide. This was really just to illustrate the number of integrated care systems that we now have in the U.K. and to show you a very rough distribution. What this -- as you will see, all of the ICSs are very different sizes. They have very different populations and makeups and also very different health care needs depending on their location. That actually makes it quite difficult to standardize the pricing of Bleepa as a CDC proposition. So we actually do price on a per-patient-episode basis. But to give you some sense of the order of magnitude, we would expect a typical CDC contract to be in the order of GBP 450,000 per year in the situation where we are providing the cloud hosting. There are some customer sites that are likely to want an on-premise hosting whereby we won't be accruing cloud costs. And at that point, the price point is about half, roughly, of what we would expect there. This is just to highlight the APPG for diagnostics report. This is available on our website. And if you can't find it, please let us know, and we will be more than happy to forward you a copy of it. It's well worth a read for any investor that really would like to understand this space, what the drivers are, what has been achieved to date. And you will see that Bleepa is actually mentioned throughout the report, both in the executive summary and subsequently because it is such a key example of the digital gap that now needs to be filled. So moving to India. As we illustrated in the post-period highlights, the substantive change here has been about the award of the import license for Bleepa to our operating subsidiary in India and also the appointment of Rohit Singh as our In-Country Managing Director. What Rohit has primarily focused on is raising the profile of Bleepa within the Indian market. You will hopefully have seen, for those who follow our social media, we have started to receive a number of awards for Bleepa, and that is largely thanks to Rohit and his network and his ability to get in front of these sorts of organizations. And it has already started to generate a lot of the inbound inquiry for Bleepa. The second thing that is really driving the market opportunity here is that India is currently adopting its own equivalent of the GDPR legislation, with equivalent fines. So just as we are beginning to see GDPR being a driver for the move away from WhatsApp here in the U.K., that is now coming through in India as well. What that actually means for us is that our ideal target customers, the large hospital chains in India who maybe have 40, 50, 100 hospitals -- and in some cases, are almost as large as the NHS themselves. They will be the initial target for this regulatory and legislative process, and therefore, they are the ones that are most exposed and are also most likely to have the leak. So it means that Rohit is being able to get right in front of these organizations. There's a bit of a regulatory stick coming down the road. And then we are also able to demonstrate the same benefits and evidence that we've drawn out of the Northern Care Alliance to make a very compelling argument as a carrot. This will also have huge efficiency around your organization and will therefore strip out a lot of cost for you. So we will both make you compliant, we will save you time, and we will save you cost. And that is really beginning to resonate. And I don't anticipate it will be too long before we're able to say, but we have a definitive opportunity here. And then again, as we touched upon earlier, hot off press today, this is our partnership with Medical Imaging Partners. This is absolutely focused around how we leverage the work we've done at Queen Victoria Hospital around pathways and bring it into the private health care space. Insurers are now up against it because of the wait list in the NHS, most people with private health care policies are activating those policies, which is somewhat breaking the insurance model. And it means that actually they need a much more efficient means of delivering care and a pathway approach that goes straight to diagnosis and enables multi-specialty remote review, cuts out 2 outpatient appointments and is proven to save a lot of cost, is exactly what they're looking for. And this is the first of many conversations that we've actually been able to announce, and it will be a really useful proof case as a stepping stone transition from the NHS into the private sector and will support the conversations we are having with a number of the U.K. larger providers and insurers. So we will keep the market updated, obviously, as this progresses and as we are able to translate that data across and demonstrate that impact. And I mentioned right at the beginning, the second thing that this is about is not just optimizing the private sector pathways and helping them to strip out costs but actually demonstrating that they, therefore, have the capacity to deliver more of the NHS outpatient elective pathways. And therefore, when the NHS is out looking to outsource more of that activity, it makes it more attractive to be able to do that in the private space where they know it can be done safely and effectively. And because of this pathway approach, probably at a lower price point. So we will also save NHS money, but allow them to outsource more work to the private sector. And lastly, just before we draw to a close and take questions, just to highlight again the strategy for us to generate revenue by licensing some of our legacy technology, we have a long-term relationship with a company called Imaging Engineering, who licensed Cadran, which was one of the underlying technologies of Bleepa, and one of the initial products that the company had for the last couple of decades. What Cadran allows Imaging Engineering to do is to convert old X-ray machines that run on analog technology to a digital technology that makes them more efficient and allows them to essentially acquire x-rays as a lower radiation dose. And there are about 2,000 sites across the U.S. that are going to either need to buy new X-ray equipment or upgrade to the digital model, and it is, of course, considerably cheaper to upgrade to digital than it is to buy a new system. And therefore, that's the market that Imaging Engineering are going for. We saw $0.08 million of revenue in this period, which is slightly up actually on the prior period. And we suspect that as Imaging Engineering grow into that opportunity in the U.S., we will see that revenue at least maintained, if not growing as they grow into that opportunity. So just finally in terms of outlook, I think the near-term opportunity for us is to really double down on the outputs of the APPG report and the traction that is getting with the national team around CDCs. It won't have escaped anyone's attention that we will, at some point, have a general election and the outcome of that general election. We already set the tone for the rest of the NHS for the next 5 years. One thing we can guarantee that will be in there is the fact that they will have a huge waitlist reduction program and that, that will have to leverage the CDCs. And therefore, regardless of what happens with that election, we are very well positioned. It is also worth saying that this first step into the U.K. private market does set -- it does give us the ability to demonstrate the advantage and the efficiency and the cost saving in a way that will also make that attractive to other international opportunities, particularly where insurance is the dominant form of payment, such as in the United States. So this is a sort of a stepping stone again to a much larger international opportunity, once we've been able to prove it here. So I will stop presenting there, and then we can move to questions.

That's great. Tom, Anesh. Thank you very much indeed for updating investors. [Operator Instructions] Tom, Anesh, you received quite a few questions throughout your presentation. I know we've got just a little bit of time remaining. I'll let you fire through those questions, if I may. [Operator Instructions]

So given the unique properties of Bleepa, why has it taken so long to be adopted in the NHS, e.g. at QVH pilot so far? It's a very good question. I think you're right. Bleepa has a unique position. We have a proven value to the market. It's, I think, no secret the -- that health care takes a long time to really buy and uptake a product. We are seeing that growing interest. We are seeing the adoption of pilots, and we know that pilots eventually do convert to contract. That seems to be the cycle. We know that most NHS purchasing activity comes around the financial year-end. So we are expecting most of that activity to happen in the next couple of months. QVH is a particularly frustrating example of NHS procurement. There was a legal challenge to the original procurement that meant that the entire procurement collapsed, and then as a result, had to be restarted. And as a result, that took a further 9 months to get us to this point. It's, unfortunately, just the way that the NHS does business. But as we hopefully have pulled out in this presentation, once you have acquired a customer, they tend to be extremely sticky and they tend to stick with you for the long term. And so it is well worth the effort of going through that sales process. Anesh, I don't know if you want to add to that or a question.

No, I'll move on to the next one. So this one is, congratulations on winning the IHWGold award in New Delhi. But when will we start to see some sales in India? I think with India, it's difficult to put an exact date on actual sales, but we're very confident that this will be in the short term. Rohit has built a very deep funnel of opportunities already. He's got the right contacts with the right stakeholders at the right customers. He's a one-man band in India, but we do have active partnership and reseller agreements that we are discussing at the moment, which will enable us to scale rapidly when that does happen. So I think, like I said, it's difficult to give a date, but we're confident this will be the short- to near-term.

Yes. I think it's worth saying as well, the awards that Rohit has been winning out there, the judging panel that allocates that award are often our customer groups. So it's often senior people in the large hospital chains that are making those awards, so it has a double value in that it actually also makes them very aware of a product and they get to see all of our brochures and sales collateral as part of the process. So it's a sale opportunity as well as just a marketing one.

Yes. And just to add, I think it's similar to the NHS in the U.K., I think we will probably see customers initially request pilots, albeit short-term pilots that are paid for and before entering into the contract. But I think that's just the nature of moving into a different geography. But yes, we are -- we remain confident. There's another question. How many CDCs are you currently in discussions with? So of the 174 CDCs, I'm with our sales team, supplemented by third-party lead generation and consultancy support, they've contacted the majority of those. In terms of active -- and actually, there's a huge degree of variation in terms of how ready the CDCs are for technology such as ours and actually just ready to actually start with the actual work. But in terms of active discussions, we don't, of course, publish our sales pipeline, but we have at least -- between 5 and 10 active conversations with CDCs underway.

I think to give you an idea of the scale of that -- so when NHS England brought together a webinar of CDC sites for us to present the APP report to and to basically pitch Bleepa as a solution, of -- they were able to bring in about 20 CDCs that were interested in actually pursuing a pathway approach. And of those 20, there were only 2 that were able to actually take up the pilot offer because of technical capabilities and the stage of their build and everything else, and that was Amersham and Oxford. Most of the CDCs, though, are due to complete by the end of this financial year, so should be operational in the summer, which means actually our opportunity to then grow into this space is at its [Audio Gap] potential. So I suspect that we are probably looking at an additional 60 or so CDCs that are coming online within that sort of period. And obviously, we are in communication with all of those. There's a question here around OE. So the military has been listed as a service area on the website for a number of years, yet there does not seem to be any development in this particular market. This has obvious potential, but have there been any trials by potential customers. Yes, this is a really good point. So I think it doesn't escape anyone's attention that the military would be a fantastic user of the Bleepa platform. We actually have had conversations with military -- the way that the military will engage with this is through a formalized procurement route. There is a -- there was a planned procurement that was due to take place in September of last year, which has been postponed. So we are engaged with it. As soon as that procurement occurs, we will be participating and putting in our bid. Interestingly, the military is forming some of Rohit's early conversations in India, as well, for all the obvious reasons, the ability to connect up field hospitals with specialty centers. So we will see something in this space. It's just that we're at the mercy of the procurement. Anesh...

There's another question here. [indiscernible] Have you ramped up too soon? Should you be cutting back now? You know, I think it's -- what I would say to that is there's obviously a lead time in recruiting the technical capabilities that will be recruited over the last 18 months. And actually, we are still a relatively small thing. There are 27 heads in the U.K., but we do run things as efficiently as possible. I think we have to -- I suppose what we call waiting for our contracts to come in immediately and then start the recruitment phase because there is that lead time in especially R&D, integration, implementation and technical team. So no, I think the answer to that question is no. I don't think we have ramped up and it's not time to cut at this moment in time. Like I said, we do look for cost efficiencies across the system on an ongoing basis. So I think we're very controlled in terms of our costs.

With an increased focus on digital infrastructure to a combat winter pressures and patient backlogs, how does Feedback plan to leverage its technology to capture more opportunities within the NHS and beyond? In short, by selling into the different stakeholder tiers that we presented. So there are differing priorities both nationally and at the ICS regional level. You have to be able to sell comprehensively into each of those stakeholder levels. Although the theme is always the same. It's always weakness reduction, cost reduction and workforce. So there is a sort of common approach to that. And so our approach is really to sell into each of these groups.

And this question here, do you feel confident with your ability to scale up based on customer expectations if contracts are won? So yes, we -- as we kind of alluded to, in parallel, we obviously are planning for success and a large success, and we are making sure that we are ready for a -- potential large-scale deployments of Bleepa, if that were the case. And obviously, we have no plans to recruit a huge amount of employees. What we would do in that instance is engage the partners that we've already been talking to who are essentially consultants who have NHS credentials in terms of implementation, change management integration. That's probably the area that we would require support. The technology itself is very scalable, but it's the implementation that we require assistance with. And we have relationships with providers who could do that for us if we needed to call them in that scenario.

It's quite generic a question. Could you expand on your thoughts and plans on new products and partnerships? I think fundamentally, we are very focused on deploying into the CDC space here in the U.K. and then going after the large hospital groups in India. We will be doing that in partnership, as Anesh said. And if we get the opportunity to scale at pace, then we will be doing that with partners. But in terms of building out new products, we won't be looking at that in the near term. There's a lot to go after what we've already got. And I think the opportunity is to really convert and maximize that. Will additional pilots with individual NHS organizations be required for each potential Bleepa contract or will the data from the current pilots provide sufficient evidence to roll out Bleepa on the national level? It's a good question. It's one that we are often asking ourselves. When we're dealing with individual organizations, I think that they are probably likely to want a pilot phase in the initial stage. However, as we start dealing with larger regional organizations, they are much more likely to move to contract based on the existing pilot opportunity, particularly where that is part of a more coordinated program. So where the national team are implementing a particular pathway, like breathlessness for example, there will come a point when actually we have proven the breathlessness pathway. And I think that point is coming very soon, where we will have demonstrated at QVH. We will have demonstrated that you can translate that to another site. And then having done that, the next instinct is go to contract. And that would be something that is pushed out, hopefully, at a regional level with support, hopefully, from the central team. And so I think it is -- I think we are all planning on the basis that the requirement for pilots will drop off once we reach that critical evidence point.

There's a question here. Why not pitch for the whole NHS, not at $96 million, which is the total addressable market for NHS CDCs, but at $48 million to get your foot in the door? I suppose the question there, are you pricing yourself out, is the underlying question. We've never been turned away from a contract because of our pricing. And we will always be -- the $96 million comes from an average contract value of $450,000, $500,000. For smaller CDCs, that would, of course, be lower. We price on a per-patient-episode basis, and it's very competitive. And as I said, we -- the contract value could be smaller for a small CDC, we would be more than willing to apply discounts if we got our foot in the door. But yes, price is not the reason why anyone's turned around -- turned away contract. It's other reasons, which we've outlined, including general inertia and procurement challenges, the IT department challenges that we've spoken about as well. So we certainly would not price ourselves out of getting a foot in the door.

Yes. I think if we thought the dropping the price and offering a volume discount of that scale to the national team would result in movement, we would do it in a heartbeat. The reality is, it won't. This is around multi-stakeholder engagement over time, building confidence, building the evidence base, designing and securing compliant routes for procurement and building on it. And it takes many, many engagements in many months, but we're really getting there. And I think that the -- you only need to look at the pricing in relation to the impact data to know that we're pricing it very, very attractively. So even at the lower tier of our pricing, where we have low volumes, the average per-patient price is in the order of about GBP 6. And yet we are releasing GBP 295 back to the system. And that is -- you could strongly hark you almost underpriced. However, we think that is what the NHS will tolerate in pricing. So therefore, that's where we're aiming. But yes, we're certainly not overpriced. And I don't -- as much as I would love to say if we just did an offer like that, it would shift the dial. It won't. It's not that that's holding things.

Tom, I might just jump in there because for every one question you answered, you're getting fired with another couple. I know you've touched on some of these things. And I know you've been going on for over an hour now. So I'm just mindful of both time, but if there's anything there that grabs your attention, feel free to address it. If not, obviously, I'll provide you all the questions post the meeting, and we can always look at adding additional responses at that point if that will be more suitable. If there are no further questions, then Tom, if I could just ask you for a couple of closing comments, and I'll redirect investors to give them your feedback.

Yes. No, thanks, Okay. I think you're right. Let's give everyone the time back. We'll come back on the questions where we're able to. So I just think, just to conclude, firstly, thank you all for your time. I'm hoping that we have conveyed the confidence that we feel as a management team around the opportunities ahead of us. It cannot be understated the sort of milestone we have achieved by getting money out of the central NHS England team during the current economic and workforce crisis affecting the NHS. That is a clear indication that they are taking this seriously and prioritizing it, and that they are recognizing the benefits that we bring. And in the same vein, I don't think it can be understated the significance of us opening up an opportunity in the U.K. private sector. I know that we've -- you probably all feel that we have spoken about it for a long time, and it has been in the making for a long time, which it is now here. And I think it shows that you can translate the work we've been doing in the NHS to the private sector, and opening up both channels makes this a fully comprehensive offering to the whole of health care, which is what we're all trying to deliver. So thank you for your time. Thank you for your investment in the company, and we look forward to announcing further news as soon as we are able to.

That's great. Tom, Anesh, thank you once again for updating investors. [Operator Instructions] On behalf of the management team of Feedback plc, I would like to thank you for attending today's presentation, and good afternoon to you all.