Lunit targets global expansion by completing acquisition of Volpara Health Technologies

Lunit, a local medical AI imaging company, said it has completed the acquisition of Volpara Health Technologies, a New Zealand-based firm.

During a news conference at its headquarters in Gangnam-gu, Seoul, on Wednesday, Lunit announced the completion of the M&A and outlined its future vision. The company declared "the beginning of a new AI era," emphasizing how AI technology will transform medical paradigms.

“Lunit first proposed the M&A to Volpara's management in September last year,” Lunit CEO Suh Beom-suk said, outlining the history of the acquisition deal. “Following extensive due diligence in November, we signed the acquisition agreement in December.”

Seo added that on Wednesday, Lunit acquired 100 percent of Volpara's shares, completing the eight-month acquisition journey.

With the acquisition completed, Volpara has been officially delisted from the Australian stock market, effective Wednesday.

Suh expected that Lunit's high-accuracy AI algorithms and Volpara's precise breast tissue density analysis technology would create significant synergies and enhance the level of breast cancer screening technology.

"Lunit’s ability to develop highly accurate AI algorithms combined with Volpara's precise breast tissue density analysis technology will elevate breast cancer screening technology," Suh said. “Volpara's extensive dataset of over 117 million medical images, combined with Lunit's multinational and multiracial clinical data, will develop a universally applicable base model.”

Suh noted that armed with Volpara’s established presence in over 2,000 U.S. medical sites, Lunit is strategically positioned for a robust entry into America, the largest healthcare market in the world. Leveraging Volpara's extensive presence in the U.S., Lunit will introduce its solutions to this expansive market, enhancing accessibility and adoption.

“Conversely, Lunit plans to promote Volpara’s solutions across Europe, Asia, the Middle East, and South America, where Lunit has established a strong market presence,” Suh said. “This expansion will catapult the group’s reach to a broader audience, solidifying its position as a global leader in the market.”

Volpara CEO Teri Thomas viewed the acquisition as an opportunity to increase breast cancer screening rates.

“This merger represents an exciting opportunity to enhance our impact on global healthcare. We can significantly improve early cancer detection and patient outcomes by integrating Volpara’s innovative breast screening technology with Lunit’s AI capabilities,” Thomas said. “Together, we aim to set new standards in cancer diagnostics and drive forward advancements that will benefit healthcare providers and patients globally.”

She added that the two companies' shared vision to conquer cancer will undoubtedly pave the way for transformative developments in medical AI.

The two companies also announced plans to expand their solutions beyond breast cancer to include lung cancer. Volpara recently integrated early detection software for lung cancer and nodules into its workflow platform, indicating a move to expand beyond the breast cancer market.

The companies expect to gain momentum in targeting various screening markets, including breast and lung cancer.

Looking ahead, Lunit aims to turn profitable in 2026.

"We expect total sales of 80 billion won ($58.7 million) this year, with Volpara's revenue being consolidated from June,” Suh said. “Next year, we aim to achieve over 100 billion won sales and reach solid earnings before interest, taxes, depreciation, and amortization (EBITDA) through high-margin Software as a Service (SaaS) sales by 2026.”

Volpara CEO Thomas explained that while the company initially estimated that achieving profitability would take about two years, it now believes it can be done within a year as its SaaS-based approach continues to draw a growth curve with increasing profit margins.