Earnings call transcript Q1 2023

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Operator

Hello, everyone. And thank you for joining MedAvail's 2023 First Quarter Conference Call. My name is Alicia, and I'll be your operator for today [Operator Instructions].

As a reminder, this conference is being recorded.

I now have the pleasure of handing over the call to your host, Steve Halper, Managing Director at LifeSci Advisors. ahead. go Please

Steve Halper

for all today's call. Thank participating you in

released Executive me today, Seabaugh, Ramona A Mark copy the MedAvail quarter press the Chief on are Doerr, Officer; the company or Chief MedAvail is Inc. of to and results XXXX. referred for first Joining Holdings, as financial release Financial available the Officer. Earlier website. company's

outbreak in operating for future expectations and that Act estimates performance the forward-looking as in I'd this and Private of expansion constraints and of guidance in questions based that the COVID-XX, statements, federal are events, affecting company's and hiring, war response similar the Litigation and assumptions. organization margin management of Reform the in including reimbursement, harbor relating statements to statements are expectations Ukraine questions to any during conditions, macroeconomic expenses on to opportunity market future you those Any or based industry, revenue, upon your growth addressing within like management, various company's expense the responses will the impact statements trends or effect remind call, and market and general in All financial call predictions the results events, forward-looking XXXX, to for of current or pressure, begin, services statements the gross such or forward-looking financial of of meaning operating we adverse performance, or the impact or including developments concerns those securities Before liquidity inflationary are the including and including statements are including, in laws, contained safe include your statements. made of to make limitation, of provisions Securities which relate without XXXX. that pursuant

performance. guarantee with Any statements to rely an uncertainties implied do on on them statements. without associated differ statements reliance decision not not those such making actual involve place risks not the events forward-looking by risks you material and or should in anticipated Accordingly, materially that undue considering those forward-looking future and these cause results should could from or investment and statements

information as list a intention broadcast MedAvail's description and company's or XX-Q or XX, and the This the with annual of forward-looking future conference required reports XX-K and section and including only to Form please Factors Risk whether except most and Commission. with live Exchange because financial uncertainties business, report otherwise. May the is as refer projections on associated sensitive filings law, or today, in obligation, recent and to by call on statements, any or events of new disclaims risks information, quarterly MedAvail For periodic the other contains the Securities its reports of any update time Form accurate XXXX. revise

that, the with now to turn I And call will over Mark.

Mark Doerr

Thank all us you, quarter our Steve this update. of you for joining XXXX financial and thanks operational to for and first afternoon

unmet we the mission rural, pivoted Technology believe medication we subsequently less the which SpotRx, were leading market, Pharmacy the SpotRx business quarter, first access workforce quarter. concurrent Services needs our and address CVS that become company following that announcement sale challenges, shortages in pharmacy that populated Recall during on towards can in areas. excellent sold the our with technology make we pharmacy key divesting to of including our in business executing especially we During to to a we January progress continued the Pharmacy

will and is that in more comprised pipeline, through point existing the as discuss early, prescription is of With hardware the our working, detail software shortly. And MedCenter, to medication robust partners by suggest our which of growing leading and I dispensing that care platforms. innovative and our still evidenced bring while it both in our part we strategy is indicators new

many Our create many regulatory dispensing. our In significant with that remote urgent that a playing state care role is tailwind favorable successful kiosks for activities, both closely these signed resonating care are environments us dispensing critical the others additional and a will the to Pharmacy parallel We patient. with with and dispensing. advantages, pharmacy as technology are role be just into there where and providing legislation utilize Epic to US to law embrace Willow and who believe system. remote in Colorado, states primary monitoring We we where and is that clinic System an supports clinics played was the regulations Management integration active across the kiosk MedCenter possible,

our We nearly dispensing year remain track during new field with are MedCenters the in XX our and plan this net on double to against XXXX. executing footprint

Our early have very confidence me is encouraging to MedAvail gives a progress that and on we placed success. path

the terms growth technology what by the long for in significant we a foundation growth into $X we tapping opportunities identified four the we and this installed and of future growth for for achieve early at profitability. generated of million over and remain field million XX total Again, revenue with assuming year, to are in exit Looking in the track and technology year And of revenue successful year guidance dispensing $X.X would more of we net the representing new and excited end XXX% the this pharmacy for XX financials can year pharmacy of we very we quarter, placing net but stages MedCenters numerous year. Ramona term the new $XXX,XXX will XXXX, revenue on shortly, are business we are of we have XXXX. MedCenters. generate the than full cover laying this about that dispensing in MedCenters

SpotRx, that planned divestiture business and down is as of of topic progressing planned. the the wind On

run cash $XX this about we XX%, by our by transaction and previously, $XX million OpEx by As headcount to rate indicated reduced approximately our million usage annual XX%. our

dismantled substantially hub anticipate being pharmacy part and a than to to SpotRx retrieved expected the been done by we well. of that have quarter As hub be of majority the We wind-down, have the of serviced the of captured second the in expenses the were substantial as date. are with MedCenters and the the number pharmacies projected, have associated end all second previously been quarter closure, which by lower

solutions the of pharmacy it's provide point to business, box. Through lease in the the the model, the kiosks to at MedCenter, is a the new like license pharmacy to way XXth, to point square brand. core XXX a our to and to proprietary to pharmacy business and software Taking feet enables care. care staff The MedAvail which technology technology In technology and their offer having our partners MedAvail roughly point MedAvail, business. X,XXX includes to of story, MedDispense the order remotely MedAvail XX on employ is procure ability prescribing we Pharmacy and may in their cost-effective purchase back or be associated ability shift proposition. who value medications dispensing the MedCenter our services own dispense dispensing Technology bring own the their pharmacy of SpotRx or to emerging dispense partners a announced software pharmacy January medications of technology focus pharmacy step of providers to our for a under in a MedAvail The underlying those own in inventory. from our

to can rates and inherently so, pharmacy. improved can prescription separate With the a can therapy By retail patient the lead this abandonment while patient initiate avoiding be reduced medication outcomes. MedCenter, easily doing trip to an inconvenient

and its barcode pharmacist MedCenter pharmacies minutes while persistent is that with of patients provide This and quality resulting expeditious technology has to shortage average technicians, is been restricted pharmacists integrated live labor and a and has offering needed. not patient a to X access convenience pharmacy currently through medication. suffering improving. to Additionally, when designed or are with shortage pharmacy which been dispensing safety access The both delayed times in enhanced to X

prescription that additional of benefits compliance patient the ratings dispensing, revenue. as are offer quality medication potential improved of clinic associated drive to with increased medication such satisfaction There incremental reimbursement that and convenience can the point

within a quality carefully the With more manage efficient. for and approximately systems for future we Willow pharmacy core SpotRx that in end, and activities. development has integrations Prior underway, management This our we McKesson experience in several various that force our with overall reduction previously and are specifically, pharmacy become are additional of to technology systems by at nimble have there XX%. development well management commenced conducted that the look EnterpriseRx pharmacy by further company, teams. complete weeks of continued used that partners. our reduced integrations end systems, these announced Epic headcount significant but to able Encora development, other with an down expenses software required our We the we proof-of-concept wind business opportunities used and Encora To partnership to the Encora in but accelerate another the six action, difficult systems. with MedAvail this in of to April, the full MedCenter. engineering action integrations for should to completion deployment mostly is to assurance was market. the software partnership faster integration of partners impacting want And eight the with the facilitate

kiosk given bringing inventory. currently are prebuilt our have we MedCenters And partners. experience an not a terminated positively also also We in but we This that rate expense we more manufacturer, service agreement MedCenter vendor with in-house run also whereas our had been external to better kiosk. using impacts Kitron, previously service should current our the the only create XXX our for than

are exploring service manufacturing sales continually aligned We options and to and our for pipeline. expansion

deployments. our we in the cost all and This to beforehand accelerate be the MedCenter partner year. we hosted platform, our which Google will to net In cloud on on quarter, partner cloud MedAvail first the reduce new bringing live This Cloud. will software partners is to further a anticipate and second based the intend migrate

this disruptive alternatives we primarily and to summary, We work to the that pharmacy areas every identified after In be partners will make executed careful mind. can Importantly, the and minimally be and the partner efficiently. continue of technology by patient of be with experience core in end done decisions identify by completed of we to be migration these one in-house will more have of consideration believe business and will our year. resources,

to are opportunities a lean quickly organization We to committed new emerge. growth responding of operating they capable as

Turning now to pipeline. our

System in MedCenter across our and our and Lady This MedCenters. growing continue primary among Baton uses four recently Rouge, health We of demand for new executed Missionaries Health to Franciscan system partners the a existing chains. urgent Louisiana, care both contract Epic. current for care see

with was this critical our to Willow partnership. Epic So securing successful integration

with We to online MedCenter during the bring the expect third quarter. first them

we In company, next addition, with month. to live [Curant have contracted MedCenters bring partners we our expect to including Health], who are new six more who

that mentioned, XX an in based previously, guidance stated our to In I as In committed XX. we contracted are to the seeing, been to have current place that contracting an XXXX, our during are net there the in new momentum confident all, XXXX MedCenters XX MedCenters previously partner. five by dispensing are addition by December additional existing dispensing network XX we cumulative MedCenters with of bringing MedCenters on total

In cover greater dispensing place, terms favorable that regulatory states are a than XX% US update, the current or population. waiver open have to the in remote rules of of

previously new the opening Colorado We essentially as dispensing regulations in As well. recently to up mentioned, effort. were passed involved state remote this

remote to well. of previously the Oregon environment benefits on currently and regulatory in pharmacy as that also is anticipate would clinic essentially of patient the favor. many dispensing our touched legislation the shortage remote evolve continue that to worsening I techs, will and and dispensing we allow pharmacists evaluating both that the Given

states in unfavorable. continue Despite we the these rules to be consider restricted positive half developments, that be or to place of have

$X.X annual and kiosk more term, which than long market at pharmacy maintenance open total work continue care our federally the as recapping more the an revenue. than with across or opportunity currently this with Ramona? stands software additional for to with significant were a believe encompasses additional addressable dispensing, to clinics just license serviceable care pharmacies the billions than over to to $XXX It we billion drivers and to billion we sales in an that and channels qualified leases such recurring if lawmakers contracts. to I analysis XX,XXX more this if in and our be call our that maintenance is we at sites $X.X And financials. represents expand million now growth add health the primary software our additional to review turn billion recurring addressable like Ramona in license retail all will and market and Over worth states urgent likely channels, look than more term $X.X MedCenter long excludes US more to as market. view would our state company

Ramona Seabaugh

Mark. Thanks, The operations. will comparisons outlook. exclude of our results I on before begin following with the first discontinued quarter review XXXX a touching

representing generated revenue the revenue approximately quarter in $XXX,XXX Pharmacy over XXX% XXXX period quarter fourth total of of growth $XXX,XXX. $XXX,XXX, the growth revenue For of XXXX, Technology of XXX% of of comparable XXXX and first Pharmacy in over we and Technology

Looking XXXX line at of gross quarter was XX.X%. with our profit. Total expectations. in the gross first This for was profit

anticipate down XX% from year, continue margin XXXX. from would full first quarter We of to Pharmacy first our margin improvement in which year quarter gross of the a significant for million in were XXXX a full $X.X the for XXXX Technology operating expenses excess $X.X million the represent XX%. Total gross of

representing a million quarter search XXXX. million average operations XX.X% core of $X.X continue efficiencies. At evaluate first end in outstanding. quarter As of weighted of a we first of EBITDA business $X.X the had shares in was million, the adjusted first the to additional loss we the from company Mark Technology indicated, Total the loss improvement XXXX, Pharmacy for quarter XX.X

we year full full In year it remains million XX which to represents update for us terms of in further call. which over Pharmacy excess We XX%, pharmacy which, volumes compared with, a expansion $X well this to costed to represents anticipate XX generating guidance representing full above XXX% in net XXXX. XXXX current will of adding quarter of unchanged for well with exit of year, million, new at to the and margin margin our a relative approximately growth enable XX% the revenue our would assume of full dispensing our as the throughout XX%, course margin MedCenters gross fully revenue gross XX a revenue anticipate addition MedCenters Technology XXXX, network reported ended of be from dispensing XXXX. as of nice We $X.X that QX MedCenters. technology we year for of year We fourth

kiosk. higher business our on the assist per and assumptions modeling of with our MedCenter selling assume We we of Recapping actual XX-XX. to average purposes, license machine price The a kiosk price current to is between the provided assume we and last per a per call blended purchase $XX,XXX of reflect further maintenance. leases year approximately mix $XX,XXX sales for but $XX,XXX software

of of quarter In ended with and terms $XX.X cash $XXX,XXX cash. million, of first including cash we equivalents cash, the restricted

that in attributable at quarter, and higher Recall XXXX We Silicon $X.X excluding usage SpotRx together our this pay to will fund to cash least first to the final cash During expenses year. Valley burn, approximately of be requirements. Bank with payment our anticipate which Further, in of SpotRx our operations lower at we operations, to quarterly used divestiture and that the Pharmacy fund additional full our combination anticipate million and reduce overview, year operations excluding revenue call can equity we sufficient is the margin current $X.X attributable business of cash million. concludes of we Mark. to $X SpotRx a down discontinued achieve time million balance cash now anticipate the potentially will to Services and and our back we down debt That of profitability and for financing. eliminating the need turn therefore, financial over dilutive the believe I we throughout wind

Mark Doerr

of significant the made announced be of progress patients CVS we the side and going to the I balance we'd between right To believe a creating of on we At kiosk profitability. our pharmacy for Operator? focusing your in shareholders. sum Pharmacy call for of value growth we questions. leader on pleased short sale forward, By in strike business time relatively since in the up. the and the believe are field clinics open point, line I we Ramona. long I top to dispensing very the January. to exclusively both with the benefit to you, like also track a term SpotRx enduring am this while Thank have can Technology the

Operator

from first TD with Instructions] Cowen. Rhyee is [Operator Our question Charles

Lucas Romanski

you for seeing compared new Charles. to type Can expected primary deployments us clinics and of the XXXX. of care This care customers I the ask of mix MedCenter existing a where between the on number on traction, and more XX about is guided urgent deployments and Lucas you're give then for MedCenter customers? customer coming to wanted clinics sense from

Mark Doerr

about versus market, versus bit On care to the about the urgent care the units. more the probably even urgent and continuing see When customers contracted to it which with of mix more third mix now based we between thirds pipeline seems represent existing at customers momentum and in customers a a care, point. from primary little a at pipeline customers, two have on we're this probably a little are pretty the across new of new two look existing commitments right coming

Lucas Romanski

And guys I be If are that then legislation, part broad Curious region, strategy, you know Colorado. based you been give are you you -- I'm can you've your guys in terms already more states of would on go-to-market guys you Arizona that and were are of a focusing presences comes strategy on it guys go-to-market noted in taking your to have in? or us when that helpful. approach? sorry, you opening up some you Florida details

Mark Doerr

can We're on basis. little where focused more be on states a primarily and we've quicker more the go-to-market in a effective, we bit operated where efficient

can them such there's waiver the states of of that the for regulations predominant out approach dispensing So we But or And little our and a that a states about XX% us the key can in technology. have that faster. a we Florida, believe bit broad to markets number cover all population. three go Louisiana, allow for those processes states we build again, Texas, as again, take we favorable

at Colorado, like where with also potential at to new states were partners push in Colorado there the to us. active we'll speak state partner legislation partners continue you we example. going when and when opportunities that a in we to we're as but to we're new up through look And stay So expand to again, focused bring help to an come

Lucas Romanski

sense Oak I been a have that were about that pieces Pharmacy that retrieved understand side. acquired, But recently Has then you've moving lot on could probably reigniting conversation XXX% a part I MedCenters relationship And they a given the about whether of of their wanted were understand relationship, I return? there potentially network. gotten or Street. any SpotRx there's you to ask the of not that of

Mark Doerr

dialog know I fully the speak any say did was Oak on. we for And MedCenters Street, will up had remove built, the Street sites last just weeks. MedCenters. strong all ground of based the partnership. specifically constructed of can't right, acquisition I with that's the that of in were going lot the timing. on We couple I a Oak from with those completed the a placement very

had, performance elaborate really the the So opportunity clinics, we the going the could any with but on at way and relationship was was an there can't design way on that the be further time. that there anticipate that that done based based the relationship particular we this on

Lucas Romanski

in any cash pieces which of terms having could guys kind see point to profitable. in what reach Is of there you the runway XXXX? could see down to at you terms moving need way break profitability In we being of XXXX, you due

Ramona Seabaugh

did about We will annual spend $X the go we the want operations. million I to But the about quarter, the this expenses year. on largely at $X.X this that cease we the discontinued expectations. and point, expect through discontinued technology side million on house for this after do you as don't the know, think of

cost you calculate expect further you the be years. remaining perhaps that, with would what in to So can the

Lucas Romanski

of see integrations are are integration potential can with pharmacy the that guess us for And pharmacy you integrations indication new I sense to are not platform to is translating may the on XXXX. into Can conversations an And regarding give an new should you pharmacy you in new whether management MedCenter sell of up expect in system integrate opening to management year? half deployments, of clients it us on we place, back that with or on systems or terms potential integrated a expect having you systems in other of this yet when to clients then more give warrant take to the having who management systems? platform your the opportunity kind

Mark Doerr

our track to integrations. focus system full potential partner, Curant, management we a pipeline their what guide mentioned pretty that partner in So by call to that that we deploying be in I'd and were we to of where remarks on did. new would prepared pharmacy that we the us want integration We routinely use close we on

more to anticipate like the as development they experience year, or McKesson just the do assurance, would will our pipeline working today we year our with that is and management other development significant on we the Solutions engage that Epic, integrations cycle. EnterpriseRx seeing several so well it's we'll that the of to would And and be one today. MedCenters the company software I we're as the back how them. and along that say large core come into up before which relationship build the out open efficient I and end mainly the help our where of focused mentioned the more up do because help say and we pipeline two And and locations anticipate our where of portion effective. the with us into year will integrations in with systems given we're powering more pretty of us setting pharmacy and industry did half have quality we're that already at on We at least have sales

help efficient that's integrations think in out build those manner. going an we so us And to

Operator

Thank at any not have further do questions you. time. We this

to Mark for to Doerr final it going I'm remarks. hand So back

Mark Doerr

update stay to webcast. next to call evening, joined again, want in August. good just say Have or thank that the a you, safe. quarterly I and our We look everyone to forward

Operator

joining. Thank for This you concludes today's call.

lines. your disconnect may You

MedAvail (MDVLQ) 18 May 232023 Q1 Earnings call transcript