By The Life Science Report
A neuromonitoring startup that saw explosive growth in Q1/17 plans to release second quarter financials next week.
After more than two years of preparation, Assure Holdings Corp. (IOM:TSX.V; ARHH:OTCQB) began publicly trading at the end of May under the symbol IOM on the TSX Venture Exchange, and began trading on Aug. 2 on the OTC Bulletin Board in the U.S., under the symbol ARHH.
For Q1/17, the company reported revenue of $3.9 million and earnings (EBITDA) of $3.2 million. Assure’s audited financial results for 2016, the first year it had revenue, show $5.52 million in revenue and $4.3 million in EBITDA.
The company has announced that it will release second quarter earnings on Aug. 22.
As investors ponder whether Assure can keep up the explosive growth reflected in the first quarter, second quarter increases in revenue will be partly offset by one-time expenses related to the IPO listing, as well as an increase in expenses as sales and marketing into new geographies ramps up.
The company has created a business model, through its wholly owned subsidiary Assure Neuromonitoring, to deliver efficient Intraoperative Neurophysiologic Monitoring (IONM) for invasive surgeries. Using its knowledge of the business of medicine, the company offers a service that improves outcomes for patients, reduces administration for physicians and creates surprisingly large cash flows for investors.
Preston Parsons is Assure’s founder and executive chairman. He has a decade of experience with orthopedic device sales and clinical operations. His firsthand experience provided him with the idea to create a better way to deliver IONM. Parsons was an NFL quarterback for six years, playing for four different teams, including the Denver Broncos from 2005 until 2007. Assure’s president, Matthew Willer, has had leadership roles in several successful startups that have included U.S.-operated TSX.V listings.
The vast majority of spinal surgeries and many other invasive neurosurgeries in the U.S. are observed by a dedicated technician that monitors biomedical equipment during the procedure to detect neurological signals that indicate the real-time status of the patient. The data allows the surgeon to continuously react to patient feedback. According to the company, “research has proven IONM to be effective in decreasing the chance of nerve damage and providing patients with better clinical outcomes.”
IONM Delivery by Third Party Staffing
In private practice, there are two staffing models to provide IONM services. In many cases, the IONM service is provided by a third party medical technician via a staffing company that also provides the billing for the service. Surgeons may have one technician today and another tomorrow. Technicians are often treated like a commodity.
IONM Managed by the Surgeon
In the second staffing model, the surgeon coordinates the IONM services. The challenge for the surgeons is the increase in administrative overhead, the billing challenges associated with billing for a service that is subordinate to their expertise. Many surgeons would simply rather not deal with managing and administrating IONM.
Assure hires IONM technicians and enables the building of an ongoing relationship between the technician and the surgeon. Assure manages the scheduling, equipment provisioning, billing and collection for IONM services so that surgeons can focus on case delivery. Assure provides the coding and billing for IONM procedures as well as dealing with payors and health plans.
At present, the core business relationship for Assure is with the spinal and neurosurgeons in private practice. To date it has only operated in Colorado. The next step for Assure is to expand the number of surgeons using Assure’s services in Colorado and to expand to nearby states. On June 22 Assure announced the hiring of George Sims as director of business development; according to the company, he will focus on expanding business in multiple Western states.
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