By: Mor
Mor - the company‘s founder
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Parasonic

Parasonic has developed an ultrasonic comb to kill lice and lice eggs quickly and easily, based on patented ultrasound technology, offering a first-of-its-kind treatment for the world‘s second-largest health epidemic, responsible for the $ 1.8 billion ann

$283,500

Raised so far

24

Investors

0

Days to go
Type:Equity   
Stage:Pre Sales
Category:Healthcare
•  Overfunding - Over 100%    
•  Angels law target company – Tax benefit 
  • Campaign Highlights
  • Pitch
  • Team
  • Investors 24
  • Updates 1

Campaign Highlights

An innovative and effective solution to the second largest health epidemic in the world

Parasonic offers the first and only solution of its kind to the lice epidemic, the second largest health epidemic in the world, in the form of the first ultrasonic comb, characterized by unprecedented efficiency alongside safety, in a quick and easy treatment. The Parasonic comb is the only solution for the phenomenon of Super-Lice, lice that have developed complete resistance to existing treatments.

 

A huge global market of $ 1.8 billion a year

Parasonic operates in the global market for lice and lice infestation products, estimated at $ 1.8 billion annually, with sales of chemical products, prevention products, oils and combs totaling $ 700 million annually in the US alone, and 600 million $ in Western Europe. S far, this market has not yet achieved a technological breakthrough, so the Parasonic comb has no direct competitors, which is expected to help it retain a particularly significant market share.

 

Registered patents worldwide, approval of sale and first cooperation in the USA

The company’s product and technologies are protected by 3 "families" of patents, in registration procedures worldwide. These patents cover various facets, including application of the technology in the comb itself, the ultrasonic method of operation on which the product is based, and auxiliary accessories. The first patent series has already been approved in the US and Australia in August 2018, and in the next six months registration will be completed in Israel, Canada, Europe and China.
At the same time, the company already holds a sale permit to the US and is in the process of signing a large-scale commercial cooperation agreement, with the largest chain of clinics in the United States for the treatment of lice, including 400 branches.

 

Investing in a product ready for production and distribution, after successful clinical research

Parasonic's technology is ready for commercial production and marketing after it has been proven to be effective and safe, in a clinical research conducted at the Herzliya Medical Center during 2017-2018. 23 participants were sampled and the procedure was found to be safe and effective, with no adverse effects reported, and over 94% of the lice eradicated. The research data is expected to make the product particularly attractive in a market longing for a solution. The company is expected to be a target for acquisitions for retail, pharma and medical giants due to the great value it creates for them.

Join a leading team that has already raised over $ 3 million

The company's team has extensive experience in development and management, and is led by the company's CEO Omri Ofer, who previously served as CEO of the marketing and sales division of Israel's largest pharmaceutical and healthcare distribution company. This is an opportunity to join an established company after the development and POC stages, which generates a significant disruption in the market in which it operates, having already raised $ 3 million from private investors, including the NGT tech incubator and the Chief Scientist program.

Pitch

The idea

The Need

Lice is the second largest health issue in the world, after the flu epidemic. However, despite the prevalence of the problem, there has been no technological leap forward in dealing with this problem to this day.

Lice infection occurs mainly in children aged 3-11. In the United States alone, 6-12 million new infections occur each year, with higher infection rates among girls, who usually have longer hair than boys.

For the economy, the lice epidemic means spending over $ 1.8 billion - total cost of OTC treatments, prescription treatments, mechanical combs, preventive treatments, and loss of work days for parents who need to stay home with their children.

 

A number of key factors reinforce the existing need:

1. Resistance - Lice are more resistant to the chemical treatments available today. In fact, every 2-3 years, lice become resistant to the new chemical products that are released to the market.

2. Efficiency against eggs - Even when the products are effective to some extent against the lice themselves, they are not effective enough against lice eggs. Therefore, treatment has to be repeated after several days to prevent further infection.

3. Side effects - The most common side effects to existing products on the market are skin irritation and allergies, resulting from the exposure of the scalp to these chemicals.

Due to possible side effects of drug lice products, and as a general trend in recent years, the market and consumers are increasingly choosing "natural" products or technological solutions. But the effectiveness of natural products today, made from different plant extracts, has not been clinically proven.

 

The solution

The lice epidemic refuses to disappear or diminish, and every year infection numbers rise. The phenomenon has been with us since the Stone Age – lice on the heads of human beings are actually modified chimpanzee lice, that has adapted themselves to man.

For a treatment more effective than ever before, ParaSonic developed an ultrasonic comb, which kills lice and lice eggs with a simple combing. In addition, the comb collects the dead head lice into a cartridge, so no rinsing is required after treatment.

Combing with ParaSonic comb enables treatment on a daily basis, which helps to prevent the spreading of lice and egg hatching on the child's head, as soon as they have been infected.

 

The Technology

ParaSonic's revolutionary comb is based on ultrasound technology and kills lice and eggs in a single combing session, taking about 10 minutes.

The teeth of the comb produce the ultrasound waves directed at the hair that passes between the teeth (this process is protected by the patent), so the lice and eggs on the hair are exposed to these waves and destroyed. The ultrasound waves are gentle pressure waves that operate at a specific frequency, designed to damage only the head and body lice (this frequency range is also protected by a patent).

CarelyTM is a comb with slightly elastic teeth, so the product is suitable for any hair type - smooth, curly or wavy - as well as for any hair thickness.

In the clinical trial conducted among 23 children at the Herzliya Medical Center, the kids reported that the combing was pleasant and expressed a preference for daily combing with CarelyTM, over a weekly combing with the simple, "traditional" comb.

 

How Does It Work?

Ultrasonic waves pass between the teeth of the comb. The lice and eggs that are found on the hair enter the acoustic area and are exposed to it. Only a second of exposure is needed in order for them to die.

Business model

The business model for Parasonic’s activity is primarily based on a one-time purchase of the comb itself.

In addition to the comb, there are two consumable components for disposable use, which will be repeatedly repurchased by customers:

1. Comb teeth to collect lice (the packaging contains 4 changeable teeth)

2. Lotion for use before each treatment (the lotion comes in 250 ml packs, enough for 4-5 treatments)

It is estimated that customers will purchase these consumable accessories once a month, allowing for one treatment per week.

The market

The global market for the treatment and product industry for lice and lice eggs is estimated at $ 1.8 billion annually.

The US market leads the global market at about $ 700 million annually (38% of the total market), followed by Western Europe with sales of $ 600 million (36% of the market), Latin America is in third place with $ 300 million (14% of the market), and the list ends with Asia, with a market estimated at $ 200 million (12%) annually.


  
Due to the difficulty in dealing with theis widespread and well known problem, there is an increase in the American market over the years, as throughout the world, both in terms of market size and in the number of businesses which offer professional lice services, to which kids are brought for treatment.
To read more about the market click here and here.


Competitors

  • OTC chemicals without prescription - most of them are produced from the chrysanthemum flower and have been in the market since the 80's. They kill only lice (without eggs) by binding to the neural canal of the lice and blocking it. Therefore, it is recommended to perform an additional treatment on day 7-10, killing all lice hatched since the first treatment. In recent years it has been proven that lice are 100% resistant to these products, until then these items were the leaders in the American market.
  • Prescription products - most of them contain the same active ingredient in chemical products but at higher concentrations. Requiring doctors to prescribe these products only if the child has side effects due to lice (such as secondary infections) in order to maintain some efficacy for these substances. Prescription products are expensive and cost between $ 120-280. Some products have some efficiency with killing eggs, but still a second treatment is necessary, such as using a comb.

  • Natural substances and silicone - because of side effects of allergies, itching and redness along with low efficiency and the need to comb with comb more and more parents prefer the use of natural materials along with using a tight comb. However, the effectiveness of these natural materials and how effective they are without additional combing has never been proven. In addition, several products based on silicone have been launched in recent years. These are considered “natural” but they are not. Furthermore, silicone is not allowed in the US if the products contain over 1% of it, and therefore these products are not approved for use in the US. The silicone actually enters the respiratory areas of the lice and blocks them, so they die in suffocation. Common side effects of silicones are: redness, itching and baldness in some areas. There is some efficiency in dealing with eggs, but repeated treatments are needed.

  • Mechanical and electrical combs - ASSY 2000 is the leading products in mechanical combs, its price is about 65 NIS and its uniqueness is both in the long teeth and the “scratches” on the teeth that allow for better capturing of the lice and eggs. The major disadvantage of this comb is the time required (every two days, a basic combing of 40 minutes is required) and dealing with the lice, as they need to be removed alive from the comb to the sink, where they are usually crushed using the parent’s nails. The best-selling comb is a robi comb, its teeth pass an electric current to the lice and kills it. But this comb has very low efficiency, and yet more than half a million units are sold every year, a fact which highlights the frustration and the search for solutions in this market.

An example of one of the most prominent deals in the market comes from Australian company Hatchtech, which developed a prescription product and signed a deal worth up to $ 279 million (with Dr. Raddy's drug company) to commercialize the innovative lice treatment.
Dr. Raddy's labs will pay Hatchtech an opening fee of up to $ 85 million for commercialization, and $ 279 million in sales-based milestones.

 

Timeline

  • December 2018 - Receipt of CE approval
  • March 2019 - Completion of the cost reduction process for production
  • April 2019 - Israel Distribution Agreement
  • June 2019 - Ready production line and production of 10,000 units for the Israeli market
  • July 2019 - Distribution agreements with Germany and England
  • August 2019 - Entry into the Israeli market
  • September 2019 - Production of 25,000 units for European markets
  • November 2019 - Entry into the markets in Germany and England
  • March 2020 - Entry into the US clinic market

 

Go To Market

ParaSonic intends to conduct the sales the product through pharmacy chains, private pharmacies, clinics and via Amazon.

The company intends to recruit strategic partners / distributors in every selected territory and to market the product through them.

Choosing the distributor / strategic partner will be a key factor in the success of the product in each region, with the advertising and marketing costs of the product in each country included in the distributor's budget.

1. The product will be marketed in Israel in the first stage, which will be used as Beta # 1

The are two main objectives to beginning the marketing development in Israel:

• Examination of product effectiveness, marketing feasibility and handling objections from the local population - allows for better acquaintance and accessibility to the target audience.

• In most cases where the company offers a product to a business partner abroad - one of the issues dealt with by the company relates to the degree of success of the product in the country of origin.

Due Date - Q3-2019.

2. In November 2018 ParaSonic will participate in two major events in Europe:

MEDICA EXHABITION - The largest exhibition in the world in the field of health care, during which the company will present the product in cooperation and under the Israel Export Institute booth, which is one of the most sought after and most intriguing in the exhibition.

 

 

CEUTA HEALTH-CARE ALLIANCE CONFERENCE-LONDON - The largest distributor conference in Europe. The company passed the acceptance committee with its product and received 30 minutes of presentation time in front of potential distributors.

 

 

The aim of both events is to recruit distributors for the first two European territories.

Launch date in Europe - Q1-2020.

3. The American market:

This market is characterized by a treatment method that includes specialized clinics for treating lice. The company is in contact with the largest chain of 400 clinics in the United States, for a strategic cooperation in which the children will be treated with the ParaSonic product.

At the same time, the company will engage with a distributor with vast connections in pharmacy chains and pharmacies in the United States.

Launch date in the US - Q1-2021.

The exit strategy

Parasonic's exit strategy is based on successful marketing feasibility. Therefore, after success in Israel, the company will enter two European countries - England and Germany.

Like other companies, after successful marketing feasibility, the company expects to receive requests from large and established distribution companies that may be interested in the product, patents and / or knowledge accumulated in the company, who will prefer to acquire or merge with ParaSonic instead of a collaboration.

There are many large companies that sell consumer medical products who aim to enter the field of lice, but have not yet found a winning product, and many companies that have who a long record in the field, but with products whose sales are decreasing annually, due to the lice resistance to products, low efficiency, many side effects and so on. These companies include BAYER, TRYRATECH, TECHLABS, ARBORPHARMA, PRESTIGE BRANDS and more.

Use of proceeds

Minimal recruitment:
The recruitment in this scenario will be used to produce 15,000 comb units and 25,000 consumable units, as well as investment in product marketing in Israel.

Maximal recruitment:
In this scenario, money will be invested in several parallel channels:
1. Marketing - focusing on product marketing in Israel.
2. Closing exclusive distribution contracts in two markets in Europe.
3. Reducing production costs.
4. Production of 15,000 comb units and 25,000 consumable units.

Team

Omri Ofer
CEO
Biography
Omeri has served as CEO in marketing and sales division over 16 years at Chemipal Ltd. Chemipal is the biggest Israeli company that markets, sells and distributes pharmaceuticals consumer goods and health products with an annual sales scope of approx. 700 million $. He holds an Executive M.B.A. from The Hebrew University. Majored in Strategic Management for managers of companies.

Jonathan Yahalom
CTO
Biography
Jonathan has over 8 years of experience as R&D and project manager at biomedical startups and ultrasound devices. He holds a B.Sc in Biomedical Engineering from Ben-Gurion University, and an MBA from the College of Management Academic Studies

Mor Cohen
Founder & Board
Biography
Mor has served as clinical director and product manager at leading Israeli medical esthetics companies. She holds an MSc in Biology/Genetics from Ben-Gurion University, and an MBA from Tel Aviv University.

  • Founder
Gary Jacobs
Chief of board of directors
Biography
Managing director of Jacobs Investment Company LLC, San Diego, CA. Chairman of DermTech International, Nutrinia Ltd., GEO2 Technologies Inc., and director at Fallbrook Technologies.

  • Chairman of the Board
Zohar Gendler
Active board member
Biography
CEO and Managing partner of NGT3VC 3, former CEO & director of Beta-O2 Technologies for 8 years. Served as CEO of the Technion Entrepreneurial Incubator for 11 years, led the establishment and investment in more than 50 companies including: Prolor Biotech (sold to OPKO, NYSE: OPK), Mazor Robotics (NASDAQ: MZOR), ReWalk (NASDAQ: RWLK), Corindus (NASDAQ: CVRS), Regentis and many others

  • Director
Joe Kalfa
Private Investor
Biography
Joe Kalfa is in the Dental Manufacturing and Distribution business, based out of Toronto, Canada. He is an investor in a number of Dental & Med Tech start ups. He also is a majority shareholder in a Luxury Consumer goods company based in the USA, that distributes Optical and other lines to companies like Walmart.

  • Director
  • Advisor

Investors 24

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Updates 1

  • Update date: 21/01/2019

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