CloudMD Software & Services Inc. (TSXV: DOC, OTCQX: DOCRF,
Frankfurt: 6PH) (“
CloudMD” or the
“
Company”), a healthcare technology company
transforming the delivery of care, is pleased to announce the
successful completion of the previously announced acquisition of
MindBeacon Holdings Inc. (“
MindBeacon”), one of
North America’s leading providers of digital mental health care,
pursuant to a court-approved plan of arrangement (the
“
Arrangement”). Pursuant to the Arrangement,
former MindBeacon shareholders are entitled to receive $1.22 of
cash plus 2.285 common shares of CloudMD for each common share of
MindBeacon. Following completion of the Arrangement, CloudMD has
287,675,749 common shares issued and outstanding, of which
approximately 19.1% are owned by former MindBeacon shareholders.
MindBeacon’s robust digital mental healthcare
platform, combined with its network of over 500 licensed therapists
and advanced clinical psychologists, offers a full continuum of
care centered around providing users the freedom to choose how,
when and where they engage with support.
“We are thrilled to close the acquisition of
MindBeacon, and would like to thank their shareholders, directors
and management for the support and collaboration during this
process. By uniting CloudMD and MindBeacon’s platforms, we will
create a leading, fully-integrated health offering that provides
effective stepped care across the entire spectrum of physical and
mental healthcare,” said Dr. Essam Hamza, CEO of
CloudMD. “The acquisition is expected to accelerate our
U.S expansion strategy, a key focus for us in 2022, and improve
organic growth by opening new distribution channels and through
cross-selling to our 5,500 corporate clients. In addition, we have
identified significant cost savings and are excited to integrate
MindBeacon’s team and operations to realize further synergies
between the businesses. Finally, I’d like to thank our shareholders
and key stakeholders who have supported CloudMD’s vision and
journey. I am looking forward to 2022 and our continued growth and
transformation.”
MindBeacon pioneered the digital delivery of
evidence-based therapy through a computer or mobile device. As a
result, over 50,000 people have been treated by MindBeacon’s
therapist assisted internet-based cognitive behavioural therapy
(“TAiCBT”), receiving help 5 times faster than
traditional community mental health care1. MindBeacon’s TAiCBT
delivers impressive outcomes, with 82% of clients reporting
self-improvement in mental health, and 67% reporting clinically
significant improvement.
“As the need for accessible mental health
support continues to grow, it is imperative that the sector
innovates to increase accessibility, improve results and reduce
costs. The progression of our Integrated Health Services Platform,
our partnership with employers, advisors and insurers and the
acquisition of MindBeacon, demonstrates our dedication to being a
leader in innovating the mental health space,” said Karen
Adams, President of CloudMD. “MindBeacon has one of the
best clinically-proven solutions in the market today and by adding
it to our platform, we can offer a broad range of synchronous and
asynchronous services in a cost-effective, stigma-reducing way that
meets patients when and where they need. We will be integrating
MindBeacon and all our mental health solutions to support
individuals at work, off work or returning to work.”
“CloudMD's Comprehensive Integrated Health
Services Platform is the perfect home for MindBeacon's mental
health capabilities. Together, we're an industry-leading holistic
health company,” said Sam Duboc, Former Executive Chair of
MindBeacon. “I'm thrilled that this opportunity will be
able to positively impact our patients and I'd like to thank our
shareholders for their overwhelming support and recognition of how
much more we will be able to accomplish together.”
The addition of MindBeacon to CloudMD’s holistic
offering positions the Company as a leader within the fast-growing
global behavioural healthcare market, which is expected to grow to
US$242 billion by 2027, with a compounded annual growth rate of
5.02% between 2020 and 20272. The acquisition is expected to be
synergistic by offering the following benefits:
- Combined, the digital health
platform is expected to be one of North America’s leading
fully-integrated health offerings, with a clinically-validated,
broad continuum of care to address mild, moderate, acute and
chronic mental and physical care.
- Integration into CloudMD’s
Comprehensive Integrated Health Services Platform will expand the
breadth of interactive technologies and tool sets within
behavioural health to support clients with longitudinal
multi-dimensional care.
- Data interoperability and increased
analytic touchpoints will provide additional valuable data around
healthcare outcomes and improve network effects.
- Significant cross-selling
opportunities through a combined network of 5,500 corporate
clients, over 5 million lives, and extensive government
contracts.
- Drive U.S. expansion through
additional capabilities, modalities, cross-selling opportunities
and MindBeacon’s recent acquisition of a U.S.-based mental health
provider.
- MindBeacon’s “Beacon in a Box”
white label iCBT SaaS offering complements CloudMD’s Digital Health
Solutions division and may be sold directly to its network of over
20,000 regulated healthcare professionals.
- Overall cost synergies, including
MindBeacon, now exceed $4 million.
The companies have already started to integrate
MindBeacon’s healthcare solutions into CloudMD’s broad continuum of
care. Management anticipates that the acquisition will generate
significant run-rate synergies beginning in the first quarter of
this year. Such synergies are expected to be realized through cost
rationalization, process integration and the scale of the combined
organization. The complementary nature of the combined digital
health offering is also expected to fuel product cross-selling
opportunities to existing CloudMD and MindBeacon clients.
In connection with closing of the Arrangement,
CloudMD expanded its management team to include John Plunkett
(MindBeacon’s former Chief Financial Officer) as EVP,
Transformation and Strategic Planning and Adam Kelly (MindBeacon’s
former President and Chief Commercial Officer) as Chief Commercial
Officer, with both positions reporting to Karen Adams.
Delisting of MindBeacon Common Shares
CloudMD intends to cause MindBeacon to delist
its common shares from the Toronto Stock Exchange (the
“TSX”), to submit an application for it to cease
to be a reporting issuer, and to otherwise terminate its public
company reporting requirements as soon as possible thereafter.
About CloudMD Software &
Services
CloudMD is transforming the delivery of
healthcare using technology and by providing a patient-centric
approach, with an emphasis on continuity of care. By leveraging
healthcare technology, the Company is building one, connected
platform that addresses all points of a patient’s healthcare
journey and provides better access to care and improved outcomes.
Through CloudMD’s proprietary technology, the Company delivers
quality healthcare through a holistic offering including hybrid
primary care clinics, specialist care, telemedicine, mental health
support, healthcare navigation, educational resources, and
artificial intelligence (AI). CloudMD’s business is separated into
three main divisions: Clinics and Pharmacies, Digital Solution and
Enterprise Health Solutions, the Company’s fastest growing
division. CloudMD’s Enterprise Health Solutions Division has built
a leading employer healthcare solutions, including its
Comprehensive Integrated Health Services Platform, which offers one
comprehensive, digitally connected platform for educational
institutions, corporations, insurers, and advisors to better manage
the health and wellness of their students, employees, and
customers.
CloudMD currently services a combined ecosystem
of over 7,000 psychiatrists, approximately 4,500 therapists and
counsellors, approximately 4,000 psychologists, over 22,000 family
physicians, over 34,000 medical specialists, over 1,500 allied
health professionals, over 500 clinics, and over 5 million
individuals across North America. For more information
visit: https://investors.cloudmd.ca.
ON BEHALF OF THE BOARD OF DIRECTORS
“Dr. Essam Hamza, MD"Chief Executive Officer
FOR ADDITIONAL INFORMATION CONTACT:
Julia Becker VP, Investor
Relationsjulia@cloudmd.ca(604)785-0850
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
FORWARD-LOOKING STATEMENTS
This press release contains “forward-looking
statements” and “forward‐looking information” within the meaning of
Canadian securities laws. Forward-looking statements in this press
release include, but are not limited to, statements with respect
to: the impact and benefits of the Arrangement, including that it
will accelerate CloudMD’s U.S. expansion and improve its organic
growth, as well as potential cost savings and synergies; CloudMD’s
growth and transformation; and the timing for delisting of the
MindBeacon shares from the TSX and ceasing to be a reporting
issuer. These statements are based upon information currently
available to CloudMD. All information that is not clearly
historical in nature may constitute forward‐looking statements. In
some cases, forward‐looking statements may be identified by the use
of terms such as “forecast”, “assumption” and other similar
expressions or future or conditional terms such as “anticipate”,
“believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”,
“predict”, “project”, “will”, “would”, and “should”.
Forward-looking statements contained in this press release are
based on certain factors and assumptions made by management of
CloudMD based on their current expectations, estimates,
projections, assumptions and beliefs regarding their respective
businesses and CloudMD does not provide any assurance that actual
results will meet management’s expectations. While they consider
these assumptions to be reasonable based on information currently
available to them, they may prove to be incorrect. Such
forward‐looking statements are not guarantees of future events or
performance and by their nature involve known and unknown risks,
uncertainties and other factors, including those risks described in
the respective Management’s Discussion and Analysis and Annual
Information Form of CloudMD (each of which have been filed under
its issuer profile on SEDAR and can be accessed at www.sedar.com),
that may cause the actual results, performance or achievements to
be materially different from any future results, performance or
achievements expressed or implied by such forward‐looking
statements. Although CloudMD has attempted to identify important
factors that could cause actual actions, events or results to
differ materially from those described in forward‐looking
statements, other factors may cause actions, events or results to
be different than anticipated, estimated or intended. There can be
no assurance that such statements will prove to be accurate as
actual results and future events could vary or differ materially
from those anticipated in such forward‐looking statements.
Accordingly, readers should not place undue reliance on
forward‐looking information. CloudMD does not undertake to update
any forward-looking information, whether as a result of new
information or future events or otherwise, except as may be
required by applicable securities laws.
1
https://www.mindbeacon.com/news-media/2021-top-5-mental-health-insights2
https://www.globenewswire.com/news-release/2021/01/06/2154290/0/en/Behavioral-Health-Market-to-Garner-Growth-at-5-02-by-2027.html
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