Amended News Release: Patient Home Monitoring (PHM) Announces February 2012 Monthly Financial Metrics and Growth Figures, Cha...
March 12 2012 - 1:52PM
Marketwired Canada
Patient Home Monitoring Corp. (TSX VENTURE:PHM), a company focused on in-home
cardiology healthcare services, today announced it has replaced its Chief
Operating Officer with a team of more aggressive operations executives.
Additionally, the company is providing more comprehensive monthly financial
information about the business to the market. Starting with February 2012, the
company will now provide data used to calculate monthly revenue and monthly
revenue growth. The company will continue to provide monthly growth in terms of
meters shipped as well.
New Operational Team
PHM has found tremendous enrollment demand with its clinic operations roll-up
strategy, however operational execution requires improvement. Therefore, a new
operational management team has been deployed with the focus of enrolling
patients more quickly and effectively from acquired clinics. PHM's COO/CFO has
resigned due to personal reasons. David Ward will serve as interim Chief
Financial Officer.
"Our growth continues but it is clear we need to accelerate our patient
enrollment from clinic operations," said Dr. Jaime Gerber, PHM's CEO. "Our
recent clinic acquisition shows us once again that there is a significant demand
for our services with many new patients to enroll. Our current operational
challenge is to meet this demand more quickly. I am now putting in place an
operational team that will focus on capturing revenue growth, overall
profitability and accelerating our monthly patient enrollment. I am confident
that in the months to come, and as we acquire more clinics, this renewed focus
on our clinical operations will result in increasing monthly growth. There are
thousands of patients interested in in-home testing and I plan to give every one
of them an opportunity to enroll into our service as quickly as they desire."
Monthly Revenue Growth
PHM has grown revenues by adding patients to their long-term annuity stream
business. To better communicate this trend and its impact on the business, two
figures will be reported:
1. Monthly Revenue Growth Data. PHM generates a recurring revenue stream
from enrolled testers by recording a weekly INR value and transmitting
the information to the patient's healthcare provider.
In February of 2012, PHM recorded 7,642 INR tests.
PHM projects to collect a reduced payment of $36 USD per valid INR test
for each patient which is earned after every fourth test.(1)
Month (Quarter) INR Tests Cumulative by Quarter/Reported Revenues
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October (Q1) 5,769 5,769
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November (Q1) 6,657 12,426
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December (Q1) 7,008 19,434 / $845,270 for Q1FY2012
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January (Q2) 7,440 7,440
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February (Q2) 7,642 15,082
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2. Meters Shipped Monthly. Once enrolled, PHM ships a meter with an
expected 5-year economic life to a patient. With this meter investment,
PHM generates monthly recurring revenue by providing weekly monitoring
services to the patient.
Understanding how many meters were shipped to newly enrolled patients
each month is relevant for analyzing growth because shipment of a meter
is a prerequisite to performing INR(2)tests eligible for
reimbursement(3).
PHM shipped 163 meters in February 2012, the second month of the second
quarter fiscal 2012.
Meters Cumulative by Quarter; Total for the
Month (Quarter) Shipped Year
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October (Q1) 177 177
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November (Q1) 169 346
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December (Q1) 155 501 total meters shipped in Q1
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January (Q2) 188 188
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February (Q2) 163 351
852 new meters shipped in FY2012
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As required by TSX rules, PHM must disclose information related to finder's fees
paid to brokers in connection with the recently closed convertible debenture
financings. A total of $36,480 and 243,200 broker warrants were paid to Dundee
Securities Ltd. and Wingate Investment Management Ltd. Each broker warrant is
exercisable into one common share at a price of $0.15 per share for a two year
period.
About PHM
PHM is a healthcare services company focused on providing home-based monitoring
services and supplies for cardiology patients. PHM's entry-point service
monitors patients on blood thinner medications such as Coumadin(r) or warfarin.
Medicare recently expanded reimbursement for this in-home service. PHM has a
unique value proposition to cardiology groups that manage patients on blood
thinners, focusing on systemization to enroll patients in PST. This unique,
systemized approach creates an opportunity for physician groups to operate more
efficiently, increasing revenue to their clinic while providing a higher
standard of care for patients. PHM plans to lever its position as a value-added
service provider to expand into other home-based services for these patients and
their referring physicians.
Information in this news release that is not current or historical factual
information may constitute forward-looking information within the meaning of
securities laws. Implicit in this information, particularly in respect of the
future outlook of PHM and anticipated events or results, are assumptions based
on beliefs of PHM's senior management as well as information currently available
to it. While these assumptions were considered reasonable by PHM at the time of
preparation, they may prove to be incorrect. Readers are cautioned that actual
results are subject to a number of risks and uncertainties, including the
availability of funds and resources to pursue operations, decline of
reimbursement rates, changes in US healthcare laws, coverage or budgets,
dependence on few payors, possible new drug discoveries, a novel business model,
dependence on key suppliers, granting of permits and licenses in a highly
regulated business, competition, low profit market segments as well as general
economic, market and business conditions, and could differ materially from what
is currently expected.
(1) Revenue is generated only after four valid INR tests have been completed by
a patient. To be documented as a valid INR test, the test must be performed at
least seven days after the previous valid test. PHM is reimbursed $155.71 USD
(down from $175.54 USD in 2011) for Medicare patients once the patient has
completed four valid INR tests. While not reimbursed on a per-test basis, it can
be calculated that each valid INR test in a billing cycle has a value of $38.93
USD. Not every INR test is valid, as some INR tests may be less than 7 days
apart. The majority of PHM's patient population is covered by Medicare. However,
there are also patients with commercial insurance providers with reimbursement
and allowable rates that vary by carrier and plan. The reimbursement figure
above does not include training revenue which PHM generates by teaching a
patient to successfully demonstrate a completed INR test prior to enrollment
(requirement by Medicare for the self-test INR service). Therefore, the total
revenue figure will not be exclusively tied to the total number of valid INR
test cycles completed.
(2) International normalized ratio ("INR") tests are used as measures of current
and future sales performance. Please refer to the "Non- GAAP Measures" section
of PHM's MD&A for further discussion on these operational measures
(3) Management does not mean to suggest or imply that shipment of meters is
equivalent to revenue. Meter shipment is a prerequisite, but not a guarantee, of
revenue. Management does not propose meter shipments as a non-GAAP financial
measurement, because there is no simple reconciliation between meter shipment
and GAAP revenue.
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