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Research: Healthcare
The Respiri/Access Telehealth collaboration continues to make steady gains in the US with the partners announcing their fourth commercial deal to date, with Arkansas Heart Hospital (AHH), a healthcare facility focussed on cardiovascular health. The program will focus on assessing the utility of Respiri’s wheezo device in a remote patient monitoring (RPM) setting using Access Telehealth’s cloud-based RPM solution, Remotli. The target population will include cardiovascular patients also suffering from chronic obstructive pulmonary disease (COPD), a common comorbidity. The deal follows close on the heels of the recent agreement signed with Minnesota Lung Center, although we note that, unlike the former, the AHH deal forgoes the requirement for an initial pilot study. Patient recruitment is expected to commence with immediate effect. As with the previous deals, we expect the monitoring services to be eligible for reimbursement under the Centers for Medicare and Medicaid Services’s (CMS’s) Current Procedural Terminology reimbursement codes for RPM. The market has reacted positively to the news, with the stock closing 18% higher.
Respiri |
Commercialization efforts gathering steam |
Commercialization update |
Healthcare equipment |
28 November 2022 |
Share price performance Business description
Analysts
Respiri is a research client of Edison Investment Research Limited |
The Respiri/Access Telehealth collaboration continues to make steady gains in the US with the partners announcing their fourth commercial deal to date, with Arkansas Heart Hospital (AHH), a healthcare facility focussed on cardiovascular health. The program will focus on assessing the utility of Respiri’s wheezo device in a remote patient monitoring (RPM) setting using Access Telehealth’s cloud-based RPM solution, Remotli. The target population will include cardiovascular patients also suffering from chronic obstructive pulmonary disease (COPD), a common comorbidity. The deal follows close on the heels of the recent agreement signed with Minnesota Lung Center, although we note that, unlike the former, the AHH deal forgoes the requirement for an initial pilot study. Patient recruitment is expected to commence with immediate effect. As with the previous deals, we expect the monitoring services to be eligible for reimbursement under the Centers for Medicare and Medicaid Services’s (CMS’s) Current Procedural Terminology reimbursement codes for RPM. The market has reacted positively to the news, with the stock closing 18% higher.
Year end |
Revenue |
EBITDA* |
PBT* |
EPS* |
P/Revenue |
P/E |
06/21 |
1.4 |
(8.4) |
(8.5) |
(1.22) |
21.2 |
N/A |
06/22 |
0.8 |
(6.2) |
(6.3) |
(0.87) |
37.1 |
N/A |
06/23e |
5.0 |
(2.3) |
(2.3) |
(0.29) |
5.9 |
N/A |
06/24e |
8.1 |
0.4 |
0.4 |
0.03 |
3.7 |
123.3 |
Note: *EBITDA, PBT & EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments. FY23 & FY24 EPS adjusted for new shares.
AHH, located in Little Rock, Arkansas, is one of the largest privately held cardiovascular disease (CVD) focussed hospitals in the US. The 112-bed facility employs nine cardiologists and, according to the American Hospital Directory, delivered 21,758 annual patient days of care, recording $647.3m in annual patient billing as per the latest available information. Importantly, AHH holds a five-star rating from the CMS, the highest accolade accorded to a hospital. In 2021, of the 4,586 hospitals rated by the CMS, only 455 received a five-star rating.
The RPM contract with AHH includes the full suite of RPM services, including Remotli, remote monitoring and patient engagement. The program has been selected by AHH as an add-on to the current standard of care for CVD patients who also suffer from COPD. The hospital will use wheezo to track and monitor patient physiologic data following hospital discharge and between follow-ups.
According to a 2018 scientific journal, the prevalence of COPD ranges between 13% and 39% in heart failure patients and 10–15% in cases of atrial fibrillation. Moreover, one-third of patients with ischemic heart disease are believed to also suffer from COPD. The Centres for Disease Control and Prevention reports 5.6% of the US population to be suffering from COPD (or c 18.5m people) which, despite the large patient population, continues to lack adequate tracking and monitoring.
We note that the deal with AHH is differentiated from the previous three as it calls for a full rollout of the program across all target patients, unlike the pilot studies which were a prerequisite for the other deals. We believe that this would allow Respiri to tap a larger patient population and to help build evidence-based data on the utility of wheezo as a remote monitoring tool for respiratory management.
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Research: Investment Companies
Princess Private Equity Holding’s (PEY’s) portfolio has fared quite well in 2022, with the +3.7% NAV total return (TR) in Q322 bringing the 9M22 TR decline to a moderate 4.0%. This was likely assisted by PEY’s sector mix and the temporary allocation of excess funds into senior loans in H221 (gradually redeemed throughout 2022). However, this was overshadowed by PEY’s decision to suspend its second interim dividend amid holding-level liquidity concerns due to high cash outflows for foreign exchange (fx) hedges and subdued M&A markets. This allowed PEY to build a liquidity buffer (c €88m at 18 November) to cushion against potential further headwinds due to a strong US dollar and muted portfolio realisations.
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