Company Interview / The small cap transforming lives with assistive tech

Key Points:

Control Bionics (ASX:CBL) securing a crucial investment from NorthstarTheir NeuroNode technology enabling communication for individuals with severe physical disabilitiesFuture possibilities for AI integration and the importance of disciplined capital allocation

Jeremy Steele of Control Bionics (ASX:CBL) discusses the significance of the recent half-million-dollar strategic investment from Northstar. Jeremy explains how such investments play a foundational role in innovation and development, while also adding value to their already groundbreaking work. He highlights the importance of partnerships and collaborative efforts for paving the way for future advancements.

Thanks to Control Bionics, individuals suffering from severe disabilities such as motor neurone disease or ALS obtain an unprecedented empowerment. Jeremiah elaborates on the life-changing NeuroNode technology which enables non-verbal communication in those afflicted. He shares the example of a 20-year-old cerebral palsy patient in Japan, who with the help of the NeuroNode could communicate with his mother for the first time, demonstrating the transformative impact of their product.

Despite operating in a competitive environment, Jeremy stresses that their proprietary NeuroNode technology, developed by Peter Ford, has unique positioning. Among their newest products, they also flaunt an autonomous wheelchair, which recently received regulatory approval. Jeremy shares excitement about the application of AI in their technology, hinting at future potential for the integration of electromyography and machine learning. However, he also emphasizes the importance of maintaining a balance between immediate needs and long-term growth, always aiming for substantial returns on investments.

Full unedited transcript below:

0:00

Getting into the smaller end of the market again. An Australian based company controlled by Onyx is transforming the global landscape of assistive technology. It says, empowering people with severe disabilities to communicate and interact with the world. Control bionics just securing a strategic investment from Northstar for half $1 million. Talk us through the detail. Chief Executive and Managing director Jeremy Steel. Joining us now Jeremy, welcome to Busby's.

0:24

Talk us through. Good morning. Thanks for having us. How important this, um, this funding is.

0:31

Yeah. Look, it's. I think it's not so much about the dollars as it is about the the the value of having a strategic investor like Northstar, obviously enormously credible, uh, here in Australia and certainly globally, is well recognized as a leader in, uh, impact investing and, uh, carrying the team there. I think, uh, you know, going to support us in, in a number of initiatives as we move forward. So we're really looking forward to that relationship. So, Jeremy, for those unfamiliar with what you do there at Control Bionics. So as I mentioned there, it's all about assisting patients to communicate, particularly those that are that are compromised physically, at least with illnesses such as motor neurone disease, um, ALS and the like. What do you actually offer?

1:19

Yeah, I think if people haven't experienced or don't have first hand experience in these conditions, it's sometimes difficult to understand the impact our technology has. But for individuals who are not able to communicate verbally, which, you know, people like you and I, Andrew, take for granted, how do they communicate intention? How do they share stories and experiences with their loved ones without being able to communicate? So as a business, we provide technology to these individuals who, um, have cognition, are able to communicate, understand right from wrong and, uh, substance and conversation. And we provide that technology to them in order to allow them to communicate. Perhaps one of the best examples is one of our customers in Japan who, uh, a 20 year old male who has cerebral palsy, unable to communicate or touch devices or communicate verbally, I should say. And through our neuro node technology, we've been able to him to communicate with his mother for the first time in 20 years. And she now understands he's cognitive, intelligent, understands right

2:18

from wrong and consequences. And on the basis of us connecting him to technology and communicate with his mother, he's moved out of home for the first time in 20 years, which just an extraordinary achievement and something that we have brought to thousands of people around the world in the 20 years we've been in operation. Is what you're offering unique or is a competitive environment?

2:39

So look, certainly a competitive environment. The neuro node, which is our technology developed here in Australia by a gentleman called Peter Ford, who remains a shareholder in this business that is unique. There isn't anyone else, um, globally that has has this technology. And so, you know, one of the initiatives we're moving forward through, through the the course of this financial year is to increase our distribution of that device around the world. Historically, we've sold that simply by ourselves, and now we're very keen to give other companies the opportunity to provide this technology to their customers as well. Just in terms of some of those other products, I gather that you've also got an autonomous wheelchair. That has been what? Uh, that's got regulatory approval. Yeah. That's right. I mean, a wonderfully exciting product. This allows individuals who aren't able to consistently control their powered wheelchair around the home. Actually, now, for the first time, have an opportunity to choose what room they're in or choose to leave a conversation. And the

3:39

experience that we've seen, and this is a world first developed here in Australia, has been extraordinarily meaningful. The ALS Association in the US awarded us a grant earlier in the year to to bring that product to the US, and we're currently going through FDA approval. But yes, that has TGA approval here in Australia. And we're commencing operations to start selling that here in Australia.

4:03

Jeremy, what role is AI playing in the technology that you're developing? And I guess the opportunity that it presents.

4:10

Yeah, it's uh I mean, it's a it's a fascinating part of of changing business dynamics. You know, when I started my career, I was something you saw in movies. And today it's something that you see, you know, everyone talking about, I think, um, you know, we used we work with Deakin University in our AI Institute to help us design, um, the most robust way in which drove our autonomous wheelchair unit works. And I think as we continue to build out our business. And so our newest product that we announced last year and currently in customer trials is the nearest trip. That device, you know, think of it as a universal physiological device that is pulling out extraordinary amounts of high quality physiological data from the body. Um, we're in discussions with a number of groups who have a real interest in appetite to, um, pass that data through some machine learning and AI to help diagnose and treat a whole variety of conditions. And we're really excited about what our core technology, electromyography or

5:10

EMG, which is measuring the electrical signals that are generated in your muscles through both intentional and unintentional movement. That data can be used with AI to, I think, really further, um, some interesting, uh, use cases, both medical, but also things like sports science and rehab from stroke. And so, you know, that's the that's the real blue sky opportunity for Control Bionics moving forward. So Jeremy, I did mention your R&D spend is substantial and constant. So therefore I guess go back to that how we opened there with the need for funding and just how critical it is to have that backing, uh, such as that investment from Northstar.

5:52

Yeah. That's right. You know, I think, um, you know, it's the job of a business like ours and indeed every business to make sure you allocate capital, um, in the near term and for long term growth. And I think we've, you know, demonstrated and will continue to demonstrate a kind of good discipline of, um, uh, investing money in research and development and then generating a return from that. You know, what's clear is we're not going to do all of this ourselves. I think the neuro strip gives us an opportunity to part with part and partner with third party organizations to get their support. You know, we've got a number of universities and commercial operations and operators who are keen to work with us. So, you know, funding is always important. But obviously shareholders quite rightly want to see a return on the investment. And I think we've, you know, the last 12 months, we've made some extraordinary progress in delivering on our strategy for growth and long term shareholder value creation.