These are my views and my views only. Please take below as my opinion based on in market information:
Company Snapshot
Shares on Issue:~147.2M
Options:28.5M
Current Price:17.5 cents
Cash: ~$4.7M
Market Cap: ~$25.6M(Fully Diluted)
EV: ~$20.9M(Fully Diluted)
With the advent of COVID – 19 the FDA in the USA has been given a mandate by Donald Trump to effectively fast forward all technology around healthcare solutions that can be administered out of the traditional means of face to face treatment.
With that in mind – Heramed is now ideally positioned to take full advantage of this with enormous opportunity.
Theyboast Mayo Clinic( Largest medical institution in world - www.mayoclinic.org)as a major shareholder( recent raising to them), R&D Partner, and have received FDA, TGA, CE, ANVISA approvals. They have now commenced the very exciting clinical trialsandcommercialisation with names that aregenuineTier 1 Medical institutions in USA, Australia and Europe.
The board is outstanding and includes Dr Ron Weinberger (Ex CEO, Nanosonics from circa $15Million - $900Million MC) as Chairman.\
HMD has recently raised circa $3.8 MILLION andwith circa $5 MILLION in the bank has over 12 months of capital to further any trials and progress substantial commercial opportunities, something it hasn’t had for over 12 months with it always being cum raise.
Background below:
HeraMED is a medical technology company leading the digital transformation of maternity care with its proprietary in-home maternity care platform.
The company has received a significant uplift in interest and demand for its connected monitoring solutions HeraBEAT and HeraCARE within the USA, Australia and Europe and has been waiting on the outcomes of clinical trials to close a huge pipeline of opportunities with the top 25 health care providers globally.These results are due any day.
COVID-19 – a global healthcare crisis with significant opportunities:
The recent COVID-19 outbreak has presented unprecedented challenges for Governments and medical entities and hospitals and healthcare facilities are working at capacity and under extreme pressure. This coupled with Governments urging isolation and social distancing created a unique opportunity for HeraMED to further roll-out its telehealth solution and satisfy the rapidly increasing global demand for remote health solutions.
Near Term Catalysts:
Looking at Page 11 of the most recent company presentation we have the following KEY milestones to come over the next3-4 months.
More importantly 2 of these WILL happen in the next 4 weeks and could drop at any time.1.Clinical Trials Completion
As announced on the 22 July, the company commenced its first clinical trial with JHC and overseen by Dr Porter (oversaw the Australian clinical trials for ASX: RAP– SP went up 400% once completed). With results due In the next couple of weeks I am confident this will be a game changer for HMD – providing the company with a “white paper” to close the many deals it has to roll out the suite of HMD products both in Australia and USA.Please also note DR PORTERS next Performance milestone after this trial is for a commercial agreement. I would think RAMSAY GROUP is the target here, given JHC is a part of this structure. Also worth noting Dr Porter recently went substantial with over 5% of the company.
2.HeraCare Paid Pilot
I believe this will be IMMINENT and will follow the outcomes of the clinical trial results. The company is in advanced discussions with the CEO of Joondalup Health Campus at Ramsay Health Group on how this will be rolled out but will be paid and lead to a genuine commercial outcome within Q4 2020.
3.Orion First Release and Clinical Trial
OrionAI is HeraMED’s cloud based, machine learning software-as-a-service (SaaS) platform, being developed in collaboration with the Mayo Clinic. OrionAI plans to utilise big data and analyse thousands of pregnancy records in real time to enable potentially unprecedented analysis accuracy. The platform aims to detect pregnancy complications early, which will potentially have a significant impact on pregnancy. The solution may also reduce costs for hospitals and clinics, as well as optimise the efficiency of medical professionals. With over 90,000 pregnancy records from R&D collaborator the Mayo Clinic, this forms one of the largest digital repositories in the world and will enable unrivalled efficacy with the algorithm. Any progress in Q4 2020 as planned could mark another significant Re-Rate.
4.Extended FDA Clearances
The company is about to pitch the FDA on a new clearance for hospital care – if granted means that hospitals give out the Heracare service and the patients can claim back on Insurance ( very large development )
5.Extended Reimbursement Coverage in USA
HeraMED has also forecast to finalise its CPT Code reimbursements within Q4 2020. The approval of 3 CPT codes should result in a total reimbursement of US $115 per month per patient, or aFULL REFUNDto theEND USER. Again we have seen companies recently go up 200% plus on the back of such news….I believe this will provide a significant re-rate to HMD share price.
6.First Paying Customer on the HerCare Platform
I think the first paying customers will begin subscription to the HeraCARE SAAS business model in Q4 2020. A small take up across the Ramsay Group, or Mayo will result in siginificant ongoing recurring revenues for HMD. 5000 Paid customers will result in circa $4Million revenue per annum. Given JHC does around 5500 births per annum, and Mayo over 50,000 the opportunity here for genuine revenue growth is real.
7.Scale up of HeraCare Globally 2021
HeraMED is now in genuine discussions with theTOP 25 HEALTH CARE PROVIDERSwithMILLIONSof patients. Given the cost to scale is minimal, and the revenue model confirmed and been endorsed by the likes of Mayo and JHC, once / IF we see a positive clinical trial result (DUE ANY DAY), the flow through to the current pipeline could be Significant
Summary
HMD is days to weeks away from reporting clinical trials which will provide the data that is required for the large hospitals, insurance companies in the USA to proceed to commercialisation deals. Healthcare technology is a sector whereby enormous multiples are given to stocks who can penetrate a global market which I feel HMD is on the cusp of. Over the next 6 months if they have a positive clinical trial and any type of deal in the USA I believe the market could attribute over $100mil market cap or PLUS 70c a share.
Again my views only and written by me.
