Viemed Healthcare Inc VMD

Foot in the door

[lscfa]

Viemed's contract with VA may be bigger deal than first thought. FYI, Rotech does $750 million in revenue per year.  

 

Rotech has provided Home Oxygen and Durable/Home Medical Equipment services under contract to the Department of Veterans Affairs for over 20 years. Rotech’s longstanding relationship with the VA gives them the opportunity to partner with Avenue Mori Medical Equipment, Inc., a Joint Commission-accredited and Service-disabled veteran-owned Small Business. The two companies have established a partnership to service VA contracts under a Small Business Administration-approved mentor-protg/Joint Venture agreement.
 

https://www.rotech.com/joint-venture/

[JackLambert]

Very nice catch L being stoopid. I did not realize that the Astral ventilator we support is a Resmed product.   I thought it was Philips.   Resmed was over $236 today.   With a whopping PE of 76.   someone please explain this all to me.   In simple terms so I don't get lost.   Patience,....

[jomen1789]

Rotech partnered with Avenue Mori Medical to provide exclusive or near exclusive service in a particular field to the VA. Viemed does not have an exclusive contract. But if they eventually get 30% or more of the VA market share, it's still huge. Viemed seems very well organized in the field (unlike in press releases or investor relations where they fare poorly), someone posted some info

[lscfa]

from Rotech prospectus: Contracts with the VA that generated approximately 12.4% of our revenue in 2020 will expire in 2021 unless further extended.  

[JackLambert]

I assume that "our revenue" means Rotech's? Are you suggesting 90 million of revenues might be up for bidding by VMD?

[lscfa]

Rotech prospectus says $62 million in revenue was from VA in 2020.    

[JackLambert]

Ok.  I did 12.% of 750.   My bad.    but the issue is we could bid on this ?  

[JackLambert]

And the VA business is value add not CMS bidding / billing ,....

[ValueCat]

interesting catch.  But if the VA is already doing at home ventilation, why the need for a lengthy "study"?

[lscfa]

I don't think Rotech is doing ventilators with the VA. They started the vent prodcut line on 2017 and had only 7400 vent patients in 2020.       

[lscfa]

p.s. Rotech vent growth mainly from acquistions... Ventilators.   Rental revenues from ventilators increased 52.9% primarily due to growth in market share coupled with growth driven by COVID-19 patients and two of our acquisitions whose primary focus was ventilator rentals.