Medx Health Corp V.MDX

MedX Health | SNN Network Canada Virtual

[csutton10]

Happy New Year everyone.

For those that could not attend I summarize some of the key takeaways from todays presentation by Mike Druhan at the SNN Network Canada Virtual conference. The presentation was approx. 35 minutes long with the first 20 minutes pretty much discussing what we all know already. Much of this summary comes from the Q and A. My apologies in advance as I took shorthand notes.

1. MedX and AI: Over time, as the database of MedX scanned images are captured and stored, along with the diagnostic results, the AI development will be able to immediately rule out specific moles/lesions that are just "sun damage" and eliminate the need to even been seen by a derm. Also, AI will be used as a second set of eyes for the derm to confirm or nudge the derm to take a second look. Mike says they are about 1 year out from this coming to market. Clinical trials will be necessary. This will be monetized but he did not elaborate as to how.

2. Customer Base: Talking to 5 large pharmacy chains globally at the moment. A couple of them they have been working close with for a while now. Much of the time has been spent on the security of DermSecure which is pretty much wrapped up and solved. They are now looking at 30-60 day pilot programs. We may hear more about this soon. Mike also talked much about the pharmacy model and their movement into digital health. He really sees this as a strong fit for their product. 

From the Q and A:

Note: I have not provided all the Q's and A's as some I didn't think were relevant or all that important to share.

Q1: Is the strategy to focus on growth in Brazil and Mexico OR to expand into NEW markets?
A1: They have a good partnership in Brazil. Brazil was hit particularly hard with COVID, especially where MedX has their office in Sao Paulo which slowed the penetration of their product into the market. The early order of 500 installs is still being shipped. 134 are currently down there in the market. Market is opening back up and they are expecting a good year in Brazil. COVID also slowed the Mexico regulatory approval down. Mike said they are expecting approval in the next few weeks. They are also really excited about Mexico. They have positive outlooks for both of those countries for 2021, but they are looking into other markets for growth. One of these markets is the Netherlands which was mentioned in a recent press release. Numbers from the Netherlands look very promising. Outlook is 41 clinics in NL with approximately 20 scans per day per clinic. Revenue projections are 60-70K per clinic, per year. Works out to be approx. 2.5 million in revenue in NL alone once fully operational. Mike also made note that pretty much all of this revenue is SAAS specific where they cost per scan is approx. 0.26. Mike also went out to mention expansion into other European countries/markets and will be aggressively pushing hard into the US market in 2021. 

Q2: Are the scopes patent protected?
A2: Yes. Mike mentioned thought that he doesn't care if someone reversed engineered the hardware. The value is not in the scope but in the time to go through clinical trials, published peer reviewed studies, getting a Class 2 medical device certified, getting regulatory approvals in various countries, and the big hurdle of development of your own telemedicine platform so scalability can be controlled. 

Q3: Can we start to see growth in revenue?
A3: Yes. The Netherlands announcement was a indicator of what future revenues will look like. Beginning in 2021 there will be a host of revenue specific announcements coming out. The new hired executives have done a great job getting MedX into markets where early stages of pilot programs are beginning. 2021 should see very rapid revenue growth. 2021 is the year for execution. There are no more excuses for not generating revenue.

Q4: Key factors to watch for this year?
A4: Execution, adding more distribution partners, installs, and possibly large-scale contracts.

Q5: Are you looking to raise more capital?
A5: This will be looked at on an as needed basis. There are a host of warrants currently out there that will help continue to fund the business. Strategic capital would be considered IF it helps the balance sheet. A strong balance sheet is necessary when dealing with some of the larger size companies they have been talking with. These businesses want to have confidence that you have the means to stay in business. 

That was about it.

All the best...

[Dunworkin2]

Thanks for sharing csutton, one of the better contributions that I've read on this board in a long time,much appreciated. The number of scanners deployed in Brazil is more than I anticipated, and sounds like we will be hearing more revenue announcements in 2021.  I will continue to hold my 3% weighted position. Have a great day/weekend.

[1stockwatcher]

134 scopes in Brazil - did I miss that revenue on their report or did it not generate revenue?? So when is the money showing up on the financial reports? Always great imaginary numbers never a timeline on when money will be in the bank csutton10 thanks for the info. Sad to see they still have weak guidelines for  suscess. just another wishlist.

[hopefull]

looks like the market agrees. Can anyone shed some time lines on financials. A real update from mdx would be nice or am I expecting too much.

[1stockwatcher]

you aren't expecting too much. Just more then this group is capable of