Today marks the changing of the game with respect to RAP.
As a RAPper from the beginning, it's been an extremely long & exciting journey. However, like every ground breaking journey there have been minor delays along the way as we pave new ground.
The Pivotal US study is now a go!
We have been approached (unsolicited approaches by the way) by 3 of the largest & most prestigious hospitals in the US to engage in this study. We are going to work with:
- Mass General
- Cleveland Clinic
- Texas Childrens Hospital
Where to from here?
Now the game has changed as we move towards recruiting patients across these 3 high-volume hospitals (in the middle of the US winter btw...) to meet our primary / secondary end points.
The recruitment will be fast & 'blind' from RAPs perspective. So RAP management won't know the success level (or not) of the device until the results are released. This is whats known as a 'double blind study'.
We will also not discriminate in the illness that is received by the hospitals as we are openly recruiting children to gather enough statistically significant data to present to the FDA.
Management expects the first FDA submission to be for pediatric pneumonia & this is only due to the fact that they expect the number of patients illustrating pneumonia to reach statistical significance before any other illness.
Beyond this, they will then file for FDA approval for the other pediatric illnesses, being URTI, Croup, Asthma, Bronchiolitis.
There will come a time in the coming months that RAP will have 4-5 pending FDA approvals for pediatric illnesses.
Then the approvals will roll in ... one by one ...
We then rinse & repeat the entire process for adults.
Major Insto / Corporate Brokerage Support
Today also marks an enormous milestone in the development of RAP from a 'mum & dad' type stock in to a commonly owned mid-cap company across the sharemarket.
We have previously gained the support of Fidelity (arguably the most prestigious fund manager on the planet) with them taking a c. 7% interest in the company.
Today, we obtained our FIRST BROKERAGE INITIATION OF COVERAGEfrom a major AU broking house!
The price target is largely irrelevant IMO, the fact that we have been able to solicit a major broker to initiate coverage WITHOUT the requirement of using their commercial team to raise capital is a huge feather in the cap for RAP & management. Anyone with knowledge of the industry will be reading this & nodding.
Brokers, like sheep, don't like missing out on a good thing. So we can expect the other major brokers to also initiate coverage in due course.
This wave of corporate buying will propel us in to new highs & take RAP to the next level.
If you're a client of Pattersons, contact your broker & get a copy of the report.
Wise_One's favourite part
My favourite part of the report is in the sensitivity analysis for which they develop their 'base case' valuation of 59c.
In their 'Bull Case' they are forecasting 11m consultations in FY18 for a market share of 6.5% for RAP. Based on these numbers, their valuation comes in at $1.79
We have all read RAPs investor presentations & we know their telehealth strategy is to partner with telehealth providers to "reach millions of patients" quickly... I think Patto's bull case of 11m uses in FY18 is a little light & hence their $1.79 valuation for RAP to also be light on!!
You need to start somewhere & being the initiation of coverage, this report by nature is conservative.
As milestones are ticked off, you can be sure that the analysts will revise their targets north.
Welcome to day 1 of RAP2.0 - Commencement of US Pivotal Studies
RAP Price at posting:
40.5¢ Sentiment: Buy Disclosure: Held
