Hi
@Paddy0Thanks for the reply mate, I might provide a few responses to some of your points raised. Please don't take this as arrogance/I-know-better etc - understand you've been in RSH much longer than myself, but to my mind these don't seem like major concerns to me.
US rollout costs - still quite a long way in the future, so I don't think we can be too negative or positive on this yet. Looking at the calendar plans, by the time the US rollout is due to take place, revenue from Australia and UK should be coming in, so for me I have to put these concerns on ice.
UK rollout costs - agree that expanding internationally is an expensive business. However both the MST report and comments MM has made in various places indicate that Cipla bear the brunt of a lot of the marketing spend.
Australian pricing - fair enough if you think it's too expensive but the move to reduce unit cost from $299 to $99 was a smart one for me, including upping the SaaS aspect by what I think was around 24%. The latter is a) recurring and b) has a super high margin given the only real expenses are fees from the Apple/Android app stores. Additionally, as a parent of two young children (who don't have asthma - yet!), when deciding to invest I asked myself
would I seriously purchase the product. The answer was a resounding yes. Why? The unit cost of $99 is not prohibitive and wouldn't preclude me from buying another one should it be dropped, damaged, eaten by one of my dogs etc. Secondly, the $10 SaaS cost is relatively miniscule given what many people in this modern world pay on a monthly basis - much of which exits their bank account on a regular basis without them even being aware of it. Consider a few of my own
automatic/hidden monthly expenses (off the top of my head):
$60.00 - transport tolls (minimum!)
$50.00 - Internet bill
$40.00 - Optus mobile bill
$25.00 - Kayo subscription
$16.00 - Netflix
$4.99 - iCloud storage
$195.99 TotalWould I be willing to add $10 or just 5% to my monthly bill to greatly improve the quality of life of one of my children? It's a no-brainer for me. That's the beauty of the medical device space, especially in pediatrics. When people's children are involved, there's already an incredible strong emotional factor you can align with - the company doesn't have to artificially create it itself.
Overseas pricing - this is an even easier issue to address (for me), especially for the US. Firstly, as you'll know MM has pointed out the huge reimbursement factor in the US. Doctors are incentivised by the insurance scheme to promote the use of such devices. What's the cost to the consumer? Zero! It's a win-win situation. Doc wants to promote the device because a) he/she gets generously remunerated to do so and b) it helps manage an issue remotely in the home, keeping patients from clogging up an already overburdened healthcare system. When insurance offers to pay for a product, the uptake is going to be positive. The UK is a slightly different story but as MM noted on the ****** interview they have a history of extending reimbursement to medical devices in the respiratory space.
Not expecting you to necessarily change your mind, but perhaps it might provide an alternate perspective on some of the concerns you raise.
Cheers
(20min delay)