KORU Medical Systems, Inc. (KRMD) research, news, and more from GeoInvesting

Company description

Fri, 01 Nov 2019 15:05:16 GMT

KORU Medical Systems develops, manufactures and commercializes innovative and easy-to-use specialty infusion solutions that improve quality of life for patients around the world. The FREEDOM Syringe Infusion System currently includes the FREEDOM60(R) and FreedomEdge(R) Syringe Infusion Drivers, Precision Flow Rate Tubing(TM) and HIgH-Flo Subcutaneous Safety Needle Sets(TM) . These devices are used for infusions administered in the home and alternate care settings. For more information, please visit www.korumedical.com.

Research

Fri, 13 Mar 2026 04:00:00 GMT

Koru Medical Systems, Inc. (NASDAQ:KRMD) ($4.31; $199.7M market cap) announced Q4 and full-year 2025 results:

Q4 sales of $10.9 million vs. $8.8 million in the prior year, in line with analyst estimates of $10.9 million
Q4 2025 EPS: $0.01 vs. loss of ($0.02) in the prior year, above analyst estimates of a loss of ($0.01)
Full year sales of $41.1 million vs. $33.6 million in the prior year, in line with analyst estimates of $41.1 million
Full year 2025 EPS: $0.01 vs. loss of ($0.06) in the prior year, above analyst estimates of a loss of ($0.03)
Q4 gross profit increased 22.6% to $6.8 million, while gross margin declined 30 basis points to 62.6%.
Full year gross profit increased 20.0% to $25.6 million, while gross margin declined 110 basis points to 62.3%.
The company received 510(k) clearance for UCB RYSTIGGO®, expanding its platform beyond immunoglobulin into broader therapeutic indications.
The company announced Freedom60® EU MDR certification with prefilled syringe compatibility.
The company added two pharmaceutical collaborations, including a Phase III nephrology molecule and a multi-indication drug in a Phase I trial.
2026 guidance calls for net revenues of $47.5 million to $50.0 million, gross margin of 61% to 63%, positive adjusted EBITDA, and positive cash flow.

Management Commentary:

“Our fourth quarter and full year performance reflect the meaningful progress we have made building a stronger, more scalable business positioned to meet the evolving needs of the subcutaneous infusion market,” said Linda Tharby, President and CEO of KORU Medical. “Demand for immunoglobulin therapy remains robust, supporting continued growth in our recurring patient base, and we continue to gain momentum with International Core expansion. At the same time, our 510(k) filings and clearances are broadening our platform beyond Ig and into new therapeutic areas, further expanding our patient base. We enter 2026 with a proven ability to execute on our strategy, a compelling set of additional growth opportunities, and a continued commitment to shareholder value generation.”

KRMD also announced CEO succession:

Linda Tharby will retire as President and CEO effective June 30, 2026 after five years leading the company.
Adam Kalbermatten, currently Chief Commercial Officer, will become President March 15, 2026 and Chief Executive Officer July 1, 2026.
Tharby will remain on the Board of Directors and serve as an advisor through the end of 2026.
The transition was described as part of the company’s long-range succession planning process.

Mr. Kalbermatten joined KORU Medical in 2025 as Chief Commercial Officer, bringing more than 20 years of experience in the medical device and pharmaceuticals industries. Before joining KORU, he most recently served as Vice President and General Manager, Advanced Drug Delivery Systems at Becton Dickinson where he led growth initiatives across the injectable drug delivery platform. Prior to Becton Dickinson, he served as CEO of ZebraSci, a specialized provider of drug device combination product development services, where he led an effective turnaround and growth strategy that resulted in the company’s successful acquisition.

John Fletcher, Chair of KORU Medical’s Board of Directors expressed confidence in the decision and succession plan stating, “Adam is the right leader to guide KORU into its next phase of growth. From day one, it was clear he brought the strategic vision, operational discipline, and leadership needed to take on a larger role as the Company continues to grow. On behalf of the Board, I want to thank Linda for her many contributions to KORU and for her leadership in helping build the strong foundation we have today. We are pleased that she will remain engaged as a director and advisor during the transition. With Adam at the helm, supported by an experienced leadership team and a proven strategy, we believe KORU is well positioned to continue advancing its growth and delivering long-term value for shareholders.”

The company additionally announced EU MDR certification for its Freedom60® Infusion Pump, enabling commercialization across the European Union:

Freedom60 Infusion Pump, including adapter for 50 mL prefilled syringes, received EU Medical Devices Regulation certification enabling commercialization across the European Union.
Certification also covers the FreedomEDGE Infusion Pump, expanding access to the company’s infusion system supporting prefilled syringe SCIg therapy.

“EU MDR certification for the Freedom60 Infusion Pump marks an important step in expanding access to simpler, more patient-focused SCIg delivery across Europe,” said Linda Tharby, President and Chief Executive Officer of KORU Medical Systems. “As prefilled syringes become more widely adopted, patients are looking for solutions that reduce complexity and fit more easily into their daily routines. Our Freedom60 and FreedomEDGE systems are designed to meet that need - helping streamline therapy while maintaining the reliability that clinicians and patients expect.”

Our Quick Take:

KRMD posted a quarter of Non-GAAP Adjusted EPS and introduced a solid 2026 guidance with 15 - 22%growth; gross margin of 61% - 63%; positive adjusted EBITDA and positive cash flow for the full year 2026.

KRMD’s international momentum is also impressive, with Q4 international sales up 71% following EU MDR certification.

The announcement of a structured CEO succession, handing the reins from Linda Tharby to Adam Kalbermatten (former VP/GM of Advanced Drug Delivery at Becton Dickinson and current Chief Commercial Officer), suggests a shift from rebuilding to aggressive commercial scaling.

KORU Medical Systems develops, manufactures, and commercializes innovative and patient-centric large volume subcutaneous infusion solutions that improve quality of life for patients around the world.

Research

Mon, 12 Jan 2026 16:16:56 GMT

KORU Medical Systems (NASDAQ:KRMD) ($5.65; $261.7M market cap) announced preliminary Q4 2025 results:

Q4 sales of $10.9 million vs. $8.9 million in the prior year, slightly above analyst estimates of $10.5 million
Full-year 2025 sales of $41.1 million vs. $33.7 million in the prior year, slightly above analyst estimates of $40.7 million

Management Commentary:

“We delivered strong fourth quarter results and enter 2026 with solid momentum, driven by continued strength in our core immunoglobulin business and growth in our recurring patient base,” said Linda Tharby, President and CEO of KORU Medical.

“Our international expansion strategy is on track, and our recent 510(k) submission for clearance of the Freedom Infusion System for use with Phesgo® represents a key milestone in expanding beyond Ig into oncology.”

“With continued disciplined execution on all aspects of our strategy, we are positioned well for sustainable growth in 2026 and beyond.”

Our Quick Take:

It’s encouraging to see KRMD deliver another revenue beat alongside a full year of positive operating cash flow (finally!). Performance continues to be driven by strength in the core business and growth in the recurring patient base.

International expansion is finally progressing, and a pending FDA 510(k) to support oncology use of the Freedom system is a great catalyst going into 2026. KRMD’s management is definitely optimistic about the upcoming fiscal year, and it finally looks like the company is firing on all cylinders…. following a few years of tweaking the business, driven by a new CEO. Yes, we’ve used the word “finally” three times in this takeaway!

We will be watching the story closely to determine if we believe that valuation multiples can materially expand from current levels, a situation that can aggressively occur when medical device companies inflect to being able to maintain strong revenue growth at breakeven or profitable levels

KORU Medical Systems develops, manufactures, and commercializes innovative and patient-centric large volume subcutaneous infusion solutions that improve quality of life for patients around the world.

Research

Thu, 13 Nov 2025 05:00:00 GMT

KORU Medical Systems, Inc. (NASDAQ:KRMD) ($3.78; $174.8M market cap) announced Q3 2025 results:

Q3 sales of $10.4 million vs. $8.2 million in the prior year, above analyst estimates of $9.4 million
Q3 2025 adjusted loss per share: ($0.00) vs. ($0.01) in the prior year, above analyst estimates of ($0.02) loss per share
Two new Pharma Services and Clinical Trials (PST) collaborations were announced.
Ended Q3 with $8.5 million in cash, generating $0.4 million in quarterly cash.
Raised full-year 2025 revenue guidance to $40.5 – $41.0 million (from prior $39.5 – $40.5 million), representing 20% – 22% YoY growth.
Reiterated full-year gross margin guidance of 61% – 63% and positive cash flow from operations

Management Commentary:

“During the third quarter we continued to make progress on our key strategic goals. We achieved our second consecutive quarter of more than 20% revenue growth, driven by a strong core SCIg business, while delivering positive adjusted EBITDA and cash flow generation. Additionally, we announced two new pharmaceutical collaborations, creating opportunities to reach broader patient populations,” said Linda Tharby, President and CEO of KORU Medical.

“As we look ahead, we remain focused on accelerating revenue growth, advancing our innovation pipeline, expanding our international footprint, and forming new pharmaceutical collaborations that utilize the Freedom system to treat more patients on a global scale.”

KORU Medical Systems develops, manufactures, and commercializes innovative and patient-centric large volume subcutaneous infusion solutions that improve quality of life for patients around the world.

Research

Thu, 07 Aug 2025 15:09:23 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.26; $150.4M market cap) announced Q2 2025 results:

Q2 2025 sales of $10.2 million vs. $8.4 million in the prior year, ahead of analyst estimates of $9.46 million
Q2 2025 adjusted EPS: $0.01 vs. loss of ($0.01) in the prior year, ahead of analyst estimates of a loss of ($0.02)
Raised full-year 2025 revenue guidance to $39.5M–$40.5M (from $38.5M–$39.5M)
Reiterated full-year 2025 gross margin guidance of 61%–63%
Reiterated expectation of positive cash flow from operations with year-end cash balance >$8.1M
Adam Kalbermatten appointed Chief Commercial Officer
Submitted FDA 510(k) for a rare disease biologic with the Freedom Infusion System™
Freedom Infusion System™ now indicated for expanded Empaveli® use case

"We achieved a milestone this quarter, surpassing $10 million in revenue for the first time and delivering our sixth consecutive quarter of double-digit growth," said Linda Tharby, President and CEO of KORU Medical. "Strategically, we continued to outperform the strong SCIg market through global share gains, advanced our international expansion, and submitted a 510(k) filing to add a new drug to our Freedom Infusion System. Operationally, we delivered positive adjusted EBITDA, reflecting our disciplined execution and focused capital allocation, while continuing to invest in strategic growth areas. We believe this performance positions us well to drive continued shareholder value as we scale.”

Our Quick Take:
KORU Medical’s Q2 2025 results mark a key shift from narrative to execution. Management delivered updates that support our long-standing themes that the company needs to capitalize on for a second multibagger move or to be an acquisition target. Most notably, international growth and pipeline expansion are now visible contributors.

Prefilled syringe conversions in Europe are driving real share gains, with additional markets and Japan now in play. The company also offered more clarity on its pipeline, including two antibiotics and a rare disease biologic targeting $1M in 2026 revenue, plus a new oncology pilot that opens an entirely new vertical.

KORU Medical Systems develops, manufactures, and commercializes innovative and patient-centric large volume subcutaneous infusion solutions that improve quality of life for patients around the world.

Research

Thu, 13 Mar 2025 15:15:09 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.28; $150.3M market cap), announced Q4 2024 results:

Q4 sales of $8.8 million vs $7.2 million in the prior year; in line with analyst estimates of $8.8
Q4 Non-GAAP loss per share of $0.02 vs net loss of $0.02 in the prior year; ahead of analyst estimates of a loss of $0.03

“In 2024, we delivered strong performance and hit multiple key milestones,” said Linda Tharby, President and CEO of KORU Medical. “We saw double digit growth across each of our businesses as we gained market share, entered new geographies, and increased the number of collaborations in our pipeline. As a result of increased revenues, improved gross margins, and operating expense discipline we were able to generate significant operating leverage that led to positive cash flow in the fourth quarter, and a lower full-year cash burn. I’m proud of the team as we have consistently executed on our business strategy, and this momentum is being carried into a strong start to 2025.”

2025 Guidance

Full year 2025 net revenues between $38.0 - $39.0, representing growth of 13% - 16%
Full year 2025 gross margin between 61% - 63%
Operational cash flow positive for the full year 2025

KORU Medical Systems develops, manufactures, and commercializes innovative and patient-centric large volume subcutaneous infusion solutions that improve quality of life for patients around the world.

Research

Mon, 13 Jan 2025 17:38:15 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.96; $181.9M market cap), announced preliminary Q4 2024 results:

Preliminary, unaudited fourth quarter 2024 net revenues expected to be $8.9 million, representing growth of 23% over the prior year period
Preliminary, unaudited full year 2024 net revenues expected to be $33.7 million, representing growth of 18% over the prior year
Ending cash balance of $9.6 million, representing positive cash flow of $0.8 million for the fourth quarter and full year cash burn of $1.9 million, a 67% improvement over the prior year

Both Q4 and full year preliminary results are slightly ahead of analyst estimates. It’s also nice to see the company report positive cash flow for the quarter. This is the first time this happened since Q4 2023.

“I am proud of the growth that we have achieved in our fourth quarter and 2024 finish,” said Linda Tharby, President and CEO of KORU Medical. “We executed on all aspects of our strategic plan as we continued to win share in the US market, expanded our international footprint, and made meaningful progress towards adding new drug therapies to our label. We did this as we continued to improve margins and demonstrated a disciplined use of cash. We are excited by our fourth quarter momentum that we will carry into 2025 as we look to capitalize on near-term catalysts that will continue to transform KORU into a global leader in drug delivery.”

KORU Medical Systems develops, manufactures, and commercializes innovative and patient-centric large volume subcutaneous infusion solutions that improve quality of life for patients around the world.

Research

Mon, 22 Apr 2024 14:04:10 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.08; $96.8M market cap) - Also during our conference call review we saw some remarks from KRMD that indicate the company is slightly ahead of analysts’ timeline on achieving profitability.

“KRMD 2024 will be an execution year for our team and we believe we are poised for a return to sustained double-digit growth and profitability. Vision ‘26 remains our key focus moving forward, and we are positioned for a meaningful inflection point in '24 and beyond…

…In 2023, we've laid the foundation for a strong '24 and are on a path to continued double-digit growth with a clear line of sight to profitability in '25.”

Current analyst estimates call for losses through 2026. While we would not expect the level of profitability to be high, achieving profitability could lead to an expansion of multiples, possibly pushing the company back to an EV/Sales between 4x to 8x, versus its current value of 3.1x.

Eighteen months is a lot of time for the stock to hold consistent levels in this market environment, where profitability is king. Also, we need to keep in mind that we believe the company missed an original target to be profitable at an early point. Time will tell, but the story will get interesting again as/if the company approaches profitability, especially if shares dip to a juicy EV/S of 2x. The new CEO is doing a great job on five fronts:

Solidifying KRMD’s leading position in high volume infusions.
Expanding indications of use.
Partnering with pharma companies in drug trial phases to help ensure KRMD is the drug delivery method of choice.
Growing international sales (had been a big challenge of prior CEOs.
Innovation: For example, pre-filled syringes.

Research

Thu, 14 Mar 2024 14:52:20 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.12; $96.8M market cap), announced Q4 2023 results:

Q4 sales of $7.2 million vs $7.3 million in the prior year; ahead of analyst estimates of $6.9
Q4 Non-GAAP loss per share of $0.02 vs net loss of $0.04 in the prior year; ahead of analyst estimates of a loss of $0.04
Full year sales of $28.5 million vs $27.8 million in the prior year
Full year non GAAP net loss of $0.13 vs a net loss of $0.14

“I am proud of the KORU team for delivering a solid end to 2023, led by performance in our Core business. Entry into multiple geographic markets drove international sales, and in the US, we hit a key milestone with the FDA clearance and launch of the 50mL prefill pump platform, which we anticipate will be a significant growth driver in 2024. Additionally, we saw double-digit growth in our end-user specialty pharmacy sales, reflective of share gains and a growing Ig market,” said Linda Tharby, KORU Medical's President and CEO. “Within our Novel Therapies business, we recently announced collaborations for two late-stage therapies. On the operational side, we increased gross margins, were cash flow positive in the fourth quarter and finished the year with a significantly lower cash burn than the prior year. We are excited by the momentum we are carrying into 2024; we remain focused on the execution of our Vision 2026 strategy, and positioning KORU for growth, profitability and value creation for our customers and shareholders.”

Guidance:

Full year 2024 revenue guidance is stated to be between $31.2 and $32.2 million, in line with analyst estimates of $31.8 million

Research

Thu, 09 Nov 2023 16:01:36 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.19; $99.9M market cap), a home infusion therapy medical device company, announced Q3 2023 results:

Sales of $7.0 million vs $7.7 million in the prior year; below analyst estimates of $7.9
Non-GAAP loss per share of $0.03 vs net loss of $0.03 in the prior year; in line with analyst estimates of a loss of $0.05

“Our third quarter revenues were impacted by our Novel Therapies business due to the timing of collaborations and by our Domestic Core business, which saw lower than anticipated growth in the underlying market. We progressed several initiatives in the quarter aimed at growing our top-line, including expanding our Novel Therapies collaborations, outperforming the U.S. subcutaneous immunoglobulin market, advancing our geographic expansion efforts, and gaining a new 510(k) clearance for a prefilled syringe indication," said Linda Tharby, KORU Medical's President and CEO. "We simultaneously advanced our efforts towards profitability and delivered on our gross margin goals despite revenue headwinds by exercising strategic operational expense discipline in light of our current environment. We are confident we have the right plan in place to capitalize on upcoming catalysts, grow our position in our subcutaneous immunoglobulin business, and expand into the larger addressable Novel Therapies market."

KORU Medical Outlook:

Reducing full year 2023 net revenue guidance to $28.0 - $28.5 million, from prior guidance of $31.0 - $32.5 million.
Reaffirming 2023 gross margin guidance between 58%-60% and a planned 2023 exit between 60%-62%.
Increasing cash balance guidance at year-end 2023 to greater than $10.5 million.

Research

Thu, 10 Aug 2023 15:15:43 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.37; $109.9M market cap), a home infusion therapy medical device company, announced Q2 2023 results:

Sales of $6.9 million vs $6.5 million in the prior year; below analyst estimates of $7.2
Non-GAAP loss per share of $0.05 vs net loss of $0.06 in the prior year; in line with analyst estimates of a loss of $0.05

"I am pleased with our second quarter progress, as our growth exceeded the overall SCIg market in both the U.S. and Internationally," said Linda Tharby, KORU Medical's President and CEO. "The foundation of our business remains sound, and we are diligently focused on delivering above-market revenue performance, advancing our portfolio with our innovation efforts, and increasing the number of drugs on our Freedom Infusion System. We are excited to welcome Tom Adams as our Chief Financial Officer and look forward to his continued leadership contributions. We remain committed and on track to attain our Vision 2026 strategic goals, and deliver added value to patients, customers and shareholders."

KORU Medical Outlook:

Reducing full year 2023 net revenue guidance to $31.0 - $32.5 million, representing growth in the range of 11%-17% from prior guidance of $32.5 - $33.5 million, representing growth in the range of 17-20%
Reaffirming 2023 gross margin between 58%-60% and a planned 2023 exit between 60%-62%

Research

Thu, 03 Aug 2023 19:56:13 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.48; $115.0M market cap), a home infusion therapy medical device company, announced preliminary second quarter 2023 results and provided a business outlook for the full year.

Expects Q2 2023 to be $6.9 million representing 6% growth from the prior year but below analyst estimates of $7.5 million
Full year 2023 revenue expected to be between $31 and $32.5 million, representing growth of 11% to 17% from the prior year, high end of guidance is in line with analyst estimates of $32.3. million.

“The Company's guidance for full year 2023 has been updated to reflect a Q2 2023 decline in the U.S. subcutaneous immunoglobulin market, resulting in a change of KORU Medical’s outlook on underlying U.S core market growth assumption from 10% to the mid-single digit range.

I am pleased our U.S. revenue growth significantly exceeded the overall U.S. market in the quarter and we saw continued strength in our international business," said Linda Tharby, KORU Medical's President and CEO. "The foundation of our business remains sound, and we see continued progress this quarter in Novel Therapies collaborations, with a new deal being signed and the early submission of a 510(k) for use on our FREEDOM60® Infusion System with Hizentra® 50 mL prefilled syringes. Given the U.S. SCIg market performance, and the timing of revenues from our Novel Therapies collaborations, we are updating our guidance. We remain diligently focused on delivering above-market revenue performance, advancing our portfolio with our innovation efforts, and increasing the number of drugs on our Freedom Infusion System. We remain committed and on track to attain our Vision 2026 strategic goals, including achieving +$60 million in revenues."

Research

Thu, 09 Mar 2023 15:25:37 GMT

KORU Medical Systems (NASDAQ:KRMD) ($4.00; $181.1M market cap), a home infusion therapy medical device company, announced Q4 2022 results:

Sales of $7.3 million vs $6.4 million in the prior year; in line with analyst estimates of $7.3
Non-GAAP loss per share of $0.04 vs net loss of $0.02 in the prior year; ahead of analyst estimates of a loss of $0.06

"2022 was a very impactful year for KORU Medical, as we executed on the first year of our Vision 2026 strategy and strengthened our position as a leading provider of drug delivery in the home," said Linda Tharby, KORU Medical's President and CEO. "We grew revenue by 19%, more than doubled our novel therapies revenues and pipeline, and delivered double-digit revenue growth in our Core business. We continued to build a strong team, and we are excited by the momentum we carry into 2023. We anticipate another strong year of growth across both our Novel Therapies and Core businesses, as well as completion of our operational improvements to drive our gross margin profile. We look forward to continuing to build value for our patients, customers and shareholders."

2023 Guidance:

Full year 2023 net revenue between $32.5 and $33.5 million, representing growth in the range of 17%-20%. Revenue range slightly ahead of analyst estimates of $31.1 million
To sign 6 new Novel Therapies collaborations
Two 510(k) filings submitted in second half

Main Takeaways:

New CEO is executing on its 3 pillar strategy of
- More aggressive initiatives to grow the company’s core/legacy product category.
- Gain approvals for use of the company’s infusion solutions in new product categories
- Expand internationally
No dilution on the horizon
Expects to breakeven in second half of 2024
IG (blood) supply is healthy (important sign this is a key ingredient needed to infuse drugs through KRMD platform)
We were glad to have caught one of KRMD multibagger moves through our Top 5 Fave Model Portfolios, peaking at $12.70 (422.63%) in April of 2020 and closing at $9.88 (306.58%) in May of 2020. Now, KRMD Is shaping up to be an interesting selection for long term oriented investors.
Given the company’s leading market share position and high recurring revenue, the stock could command an elevated P/S multiple, even as it loses money, if it can grow revenue at least 20% per year. We think the base case for valuation is that shares should trade at a P/S of between 4x and 6x and eventually in excess of that range if sales growth can be maintained at at least 20%. Share currently trades at a P/S of 5.6 on 2023 revenue estimates

Quotes from the conference call:

“In December of ‘21, we communicated a 5-year strategy that we called Vision 26. This vision which we have made significant progress on in ‘22 is driven by a three-pillar growth strategy that will remain our focus in 2023. The first pillar is increasing our leadership position in a growing subcutaneous immunoglobulin, or SCIg market through a focus on expanding our label indications, new patient starts and driving pre-fill adoption. Second is expanding our current leadership position in large volume drug delivery in the home to new drugs, the business we call novel therapies. Finally, expanding both of these businesses into international markets

2022 has been a tremendous year as we advanced several key milestones in our Vision 26 strategy and strengthened our position as a leader in drug delivery solutions in the home. Vision 26 focuses on growth and TAM expansion with specific commitments to accelerate revenues to a 20% revenue CAGR reaching approximately $60 million by ‘26. This will be accomplished through a strategy to grow our core business revenue by double-digits and through transforming the business from an Ig player to a broad drug delivery partner with an investment in our novel therapies business.

As in ‘22, we expect to see lower cash outlay in subsequent quarters due to increasing revenues, gross margins and working capital improvements. We’re ahead of our operating plan, and we have visibility to breakeven in the second half of ‘24 based on our current strategic outlook. While we may choose to increase our cash on the balance sheet to take advantage of additional growth opportunities through debt or non-dilutive financing, we are not anticipating any equity raises at this time.”

Research

Wed, 25 Jan 2023 05:00:00 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.79; $171.6M market cap), a home infusion therapy medical device company, announced a development agreement for prefilled syringes with a pharmaceutical manufacturer of subcutaneous immunoglobulin therapy.

“The Freedom Infusion System is the only infusion system approved for prefilled syringes, and we are excited by the opportunity to expand the number of prefilled subcutaneous therapies that are FDA approved for our innovative infusion system.”

These types of arrangements, where KRMD works with pharma companies to integrate KRMD’s solutions into their product offerings, is a big part of the current CEO’s vision to create long term streams of reliable recurring revenue.

The terms of the agreement were not disclosed.

Research

Thu, 10 Nov 2022 16:41:48 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.31; $108.4M market cap), a home infusion therapy medical device company, announced Q3 2022 results:

Sales of $7.7 million vs $6.0 million in the prior year; ahead of analyst estimates of $6.7
Non-GAAP loss per share of $0.03 vs net loss of $0.02 in the prior year; ahead of analyst estimates of a loss of $0.05

“The third quarter marks another successful quarter for the Company with strong revenue growth across each of our businesses," said Linda Tharby, KORU Medical's President and CEO. "Delivering on our strategic objectives remains a primary focus, and the progress made this quarter is representative of continued solid execution by the team. We are excited by the momentum in our novel therapies business with multiple new collaborations this quarter and by the double digit growth performance in both our domestic and international core business."

Research

Fri, 06 May 2022 12:06:32 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.80; $127.4M market cap), a home infusion therapy medical device company, announced Q1 2022 results:

Sales of $6.2 million vs $5.4 million in the prior year; in line with estimates
Non-GAAP loss per share of $0.05 vs $0.00 in the prior year; in line with estimates

“I am extremely proud of our team in delivering strong first quarter results as we continue to execute our strategic growth plan to become a broader drug delivery provider. A rebounding U.S. immunoglobulin market is encouraging, and we are successfully driving a dual focus on increasing revenues in our core subcutaneous Ig business through expanded label indications and a growing prefill market, while expanding the Freedom platform into new drug areas,"

Guidance: (inline with analyst estimates)

For full year 2022, KORU Medical reaffirms expectations that the SCIg market will recover to a high single digit rate. Assuming this market growth holds, the Company expects full year 2022 revenue to be in the range of $26.5 to $27.0 million (previously $26.0 to $27.0 million).

The Company reiterates its guidance to exit the year at a 60% gross margin run rate. Additionally, Q1 2022 supply chain disruption impacts, which are not expected to recur, have resulted in unfavorable manufacturing variances, which will be recognized in the second quarter of 2022.

Research

Thu, 03 Mar 2022 15:39:16 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.17; $141.4M market cap), a home infusion therapy medical device company, announced Q4 2021 results:

Sales of $6.5 million vs $4.1 million in the prior year and ahead of analyst estimates of $6.1 million
Loss of $0.02 vs loss of $0.02 in the prior year and slightly ahead of analyst estimates of a loss of $0.03

“We are very pleased to finish 2021 with a strong fourth quarter. Driven by the efforts of our team, KORU Medical has seen momentum in all three areas of our business – domestic and international core business and novel therapies,” said Linda Tharby, KORU Medical’s CEO. “During the fourth quarter, we hit several key milestones, including three new 510(k) clearances, increased pump placements in our U.S. business, and four new agreements in our novel therapies pipeline. In addition, we announced our new strategic plan, including milestones that will drive accelerated revenue growth, margin improvement, and expansion of our total addressable market. We look forward to continued execution of our plan and driving long-term growth and value for our patients, customers, employees, and shareholders.”

Recall, the company provided year end guidance for 2021 during its investor day in December.

Research

Wed, 22 Dec 2021 17:45:20 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.06; $136.3M market cap), a home infusion therapy medical device company, announced FDA 510(k) clearance that expands on-label use of the FREEDOM60 Infusion System to two additional subcutaneous Ig (SCIg) medications, Cutaquig®, manufactured by Octapharma, and Xembify®, manufactured by Grifols.

This shows that the new CEO, Linda Tharby, is executing on her strategy to expand the market for KRMD’s infusion pump therapy platform by strengthening relationships with its pharma partners. As explained in the past, KRMD generates revenue through two main sources:

Legacy Core recurring revenue (CRR) generated from patients receiving drug therapies using KRMD’s infusion pump platform.
Partners with Pharma companies to utilize KRMD’s solutions during their FDA trials in hopes that the Pharma companies will continue to recommend KRMD’s products when drugs are commercialized.

Research

Fri, 10 Dec 2021 16:12:29 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.34; $148.8M market cap), a home infusion therapy medical device company, held its investor day yesterday. During the presentation, the company provided Q4 and full year 2021 revenue guidance.

“the Company announced it expects the fourth consecutive quarter of positive sequential growth for the fourth quarter of 2021, and full year 2021 revenues to be between $23.0 million and $23.2 million. The Company also announced it expects the market for its domestic Sub-Cutaneous Immonuglobulin (“SCIg”) products to recover to mid to high single digits in 2022 and expects its revenue growth in domestic SCIg to be slightly ahead of that.”

The Q4 sequential growth guidance implies the company will beat the current Q4 estimate of $5.8 million and likely report close to $6.1 million.

Some other takeaways from the investor day:

“ And then looking at the targets that we have for novel therapies. So we're projecting 5 new large volume candidates getting through Phase III trials with KORU and 14 Phase III trials by 2031. And I think this is the great part, right? We don't need a lot of new drugs to commercialize. And what we're projecting here is, 1, commercialization and 5 by 2031. So where does that get us to a 2026 CAGR, somewhere between 15% and 20%, $60 million revenue projection and $200 million by 2031.”

“And we expect to see our first major drug outside of IG approved in early 2022. So I want to spend a minute talking about how the company has been known as being an IG therapy provider, and we're really looking to switch to being a broad home infusion drug delivery device provider. And as we've been out, expanding and beginning to get the KORU name out there with pharma companies, the biggest thing that we see here is why do we have such a compelling value proposition.”

Research

Thu, 11 Nov 2021 18:02:28 GMT

KORU Medical Systems (NASDAQ:KRMD) ($2.82; $125.5M market cap), a home infusion therapy medical device reported its 3rd quarter 2021 results and announced FDA clearance for delivery of Hizentra prefilled syringes.

510k clearance for use of the KORU Medical FreedomEdge® infusion pump to deliver Hizentra® prefilled syringes:

With the FreedomEdge® they simply place syringes in the pump and infuse, avoiding the drug transfer process that many patients find difficult and stressful. We’re excited to see KORU Medical’s commitment to improve patient satisfaction by getting this important FDA clearance,

Hizentra® is the most prescribed subcutaneous Ig product and the first to be available in a prefilled syringe format.

Q3 2021 Results:

Sales of $6.0 million vs $6.0 million in the prior year, a 9% sequential increase
Loss of $0.02 vs EPS of $0.01

“Our strong third quarter top-line results reflect continued momentum in all areas of our business – core US and international, as well as our novel therapies pipeline," said Linda Tharby, KORU Medical's CEO. "I'm proud of the team's progress this quarter as we strengthen our foundation, continue to build the KORU Medical team, and increase our investment in innovation. We remain focused on continued execution of our strategy, which drives incremental growth and market expansion building on our leadership position in large volume subcutaneous home infusion and extending that position into new drug therapies."

A key take away from the Q3 conference call is that KRMD now has the only prefilled syringe solution for its target market. We are beginning to see Linda Tharby’s (new CEO) vision of innovation come to fruition.

Research

Thu, 12 Aug 2021 14:38:18 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.60; $160.1M market cap), a home infusion therapy medical device announced Q2 2021 results:

Sales of $5.5 million vs $7.7 million in the prior year; slightly ahead of analyst estimates of $5.3
Non-GAAP loss of $0.02 vs Non GAAP EPS of $0.02 in the prior year; in line with analyst estimates

“We are pleased with our performance and sequential revenue growth in the second quarter and look forward to continuing to build growth and momentum in the second half of 2021. We are beginning to see a rebound in growth in the subcutaneous immunoglobulin market, and we are well positioned to remain the category leader," said Linda Tharby, KORU Medical's CEO. "We are focused on executing on our strategy, driving growth in our core SCIg therapy franchise through commercial efforts to increase penetration of home subcutaneous delivery, building a pipeline of subcutaneous therapeutic candidates and introducing product and technology innovations to generate further topline growth. "

Research

Wed, 19 May 2021 16:13:49 GMT

KORU Medical Systems (NASDAQ:KRMD) ($4.18; $190.8M market cap), a home infusion therapy medical device company sees director John Fletcher add 25,000 at average price of $4.30 in a form 4 filing from yesterday after the close.

Insider buying was one of our main catalysts in the KRMD story, you can see our full coverage on KRMD here.

Research

Mon, 17 May 2021 16:40:53 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.75; $164.7M market cap), a home infusion therapy medical device company reported Q1 2021 results last week, highlighted here. Some conference call Information Arbitrage indicated Q2 started off strongly with April sales exceeding the monthly sales of each of the prior six months.

Research

Thu, 13 May 2021 16:29:35 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.75; $164.7M market cap), a home infusion therapy medical device company announced Q1 2021 results:

Sales of $5.4 million vs $6.3 million in the prior year
Non-GAAP EPS of $0.00 vs $0.02 in the prior year

"In the first quarter of 2021, we faced difficult year-over-year quarterly revenue comparisons, which included several one-time purchases and a current year COVID-19 impact on new patient starts. I am encouraged by our strong sequential quarterly growth and increasing new pump placements, indicating newly diagnosed SCIg patients returning to pre-COVID levels."

Overall, we are happy with the quarterly performance and are so far aligned with the vision of the new CEO, something we will touch upon soon.

Research

Wed, 24 Mar 2021 16:47:31 GMT

KORU Medical Systems (NASDAQ:KRMD) ($3.75; $164.7M market cap), a home infusion therapy medical device company announced Q4 2020 results:

Sales of $4.1 million vs $6.2 million in the prior year and below analyst estimates of $4.6 million
Loss per share of $0.02 vs $0.00 in the prior year and below analyst estimates of a loss of $0.01

“Like many companies in the healthcare sector, 2020 was a challenging year for KORU Medical," said Jim Beck, Interim Chief Executive Officer. "Despite these challenges, we made progress on many fronts and our employees have remained steadfast in their commitment to improving patients' lives through the use of our specialty infusion solutions. As we move into 2021, our Company remains focused on executing our long-term strategies to drive growth and expand the market for subcutaneous infusions for life-saving therapies. We are excited about our new CEO and are confident that under Linda Tharby's direction, KORU Medical is well positioned for our next phase of growth."

Guidance:

“While KORU Medical Systems does not intend to provide quarterly guidance in the future, and given the timing of its release in the quarter, the Company expects net sales for the first quarter of 2021 to be at least $5.0 million.”

The $5.0 million Q1 2021 revenue guidance is slightly ahead of analyst estimates of $4.8 million.

Stock Buybacks:

"As announced on November 16, 2020, the Board of Directors authorized a stock repurchase program under which the Company may purchase up to $10.0 million of its outstanding common stock through December 31, 2021. Through December 31, 2020, the Company had acquired 683,271 shares of its outstanding common stock for a total purchase price of $3.5 million."

Research

Wed, 10 Feb 2021 14:22:44 GMT

If you've been with us for a while, you know that medical device company Repro Med Systems, Inc. dba KORU Medical Systems ( NASDAQ:KRMD ) was a darling of ours since 2016. Most recently we highlighted the company’s lackluster full year financial results that were impacted by significant fluctuations in demand, slower growth in net revenue, sub par international sales, and a slowdown in new patient starts.

Today, Maj is following up with a few answers and thoughts on where to go from here. We’ve had an amazing run with the stock, but as it is with any company, remaining objective is the most prudent approach to undertake, regardless of past performance, as well as factors that could hinder future performance.

Research

Tue, 26 Jan 2021 18:26:18 GMT

Call to Action - KRMD

Removing KRMD from our Buy On Pullback Portfolio. See details below.

---

Updates on Tracked Stocks Model Portfolios Reasons for Tracking (RFTs) Research Articles Selected Disclosures

KORU Medical Systems (NASDAQ:KRMD) ($5.13; $225.4M market cap), a home infusion therapy medical device company, announced preliminary full year 2020 results.

Preliminary revenue for full year 2020 is expected to be approximately $24.0 million, an increase of 3.4% compared with $23.2 million in 2019.
Implies Q4 2020 sales of $3.9 million vs $6.3 million in the prior year

Factors that impacted 2020 results:

Significant fluctuations in demand resulting from inventory purchasing by several large customers throughout the year;
Slower growth in net revenue as a result of strengthening our contractual position with large customers;
Less than expected international sales and clinical trial partnerships in the second half of 2020; and
A slowdown in new patient starts due to the effect of state and local guidelines that prevented many individuals from visiting their healthcare professionals in 2020

The company also announced the transition of its CEO. Board member, Jim Beck has been appointed interim CEO as Don Pettigrew has resigned and the board has retained an executive search team to identify a replacement CEO.

There is no way to sugarcoat this weak guidance. Furthermore, we are disappointed that the company did not break out its recurring revenue (base) vs. its lumpy clinical trial revenue which we believe was significant in Q4 2019. To see more on an explanation of KRMD's revenue segments, please see our Q3 analysis here.

We need a little more color on the overall health of the recurring revenue. We would at least expect it to maintain respectable growth on its own, and remain at a level of between $4 to $5 million, where it was before the new management team arrived and started focusing heavily on clinical trial revenue.

So, where do we think KRMD goes in the short-term? it's a tough call. The near billion-dollar long-term opportunity to capitalize on the growth in home healthcare is undeniable. However, investors likely require more clarity on how much of the issues are temporary and out of their control and how much are due to management's inability to grow the base business. It's quite possible that they’ve been focusing too much on clinical trial revenue, while the effort put forth into the base revenue was lacking.

Given the circumstances, we don't think it's out of the question that shares could temporarily trade at a price to sales of somewhere between 4 and 6, which would imply a price of around $2.70-$4.00.

We are also closing out the stock from the Buy on Pullback Model Portfolio #9 since the portfolio is intended to exploit price disconnects in the short term to medium term. We added the stock to the portfolio on December 1, 2020 at $4.80 based on heavy insider buying when the stock fell sharply on weak Q3 2020 results. The stock reached a high of $6.49 during its tenure in the portfolio.

Overall, we believe we have better stocks to choose from in our microcap stock pipeline.

We will continue to monitor insider buying activity and attempt to gain clarity on the recurring revenue issues.

Research

Mon, 21 Dec 2020 12:23:25 GMT

KORU Medical Systems (NASDAQ:KRMD) – The insider buying spree continues. The last two weeks we have highlighted a number of insiders buying back stock in the open market. Our last two weekly wrap up emails briefly touched on this. (12/13/2020, 12/6/2020)

On December 17, 2020, Director and largest shareholder Joseph Manko Jr. added another 10,000 at an average price of $5.69.

Research

Wed, 02 Dec 2020 05:00:00 GMT

**Model Portfolio Update - Added KRMD To Our Buy On Pullback Model Portfolio 9.0

Yesterday via a Premium only tweet, we added KORU Medical Systems (NASDAQ:KRMD) to our Buy on Pullback Model Portfolio 9.0. Over the last two days, we saw two insiders buy shares on the open market. While Director Daniel Goldberger and previous interim CEO only added 500 shares at $4.63, the Chairman of the Board John Fletcher added 22,327 shares at an average price of $4.50, nearly doubling his position in the stock.

Insider buys plus the company recently announcing a $10 million stock repurchase program gives us some confidence that management feels the recent pullback that the stock has experienced is overdone. Shares are way off the April 2020 highs of $12.84.

Research

Tue, 17 Nov 2020 19:19:50 GMT

KORU Medical Systems (NASDAQ:KRMD) ($4.19; $184.0M market cap), a home infusion therapy medical device company, announced a $10 million stock repurchase program.

"We believe that this repurchase program demonstrates confidence in our long-term outlook, the underlying value of KORU Medical stock, and our commitment to maximizing value for our shareholders,” said Don Pettigrew, Chief Executive Officer. “Our strong balance sheet enables us to support this repurchase plan, while continuing to invest in our operations and explore investments that generate long-term growth.”

The stock has pulled back a bit from its April 2020 high of $12.84, a 67% retracement.

Research

Wed, 04 Nov 2020 17:57:29 GMT

KORU Medical Systems (NASDAQ:KRMD) ($6.13; $269.1M market cap), a home infusion therapy medical device company, announced Q3 2020 results:

Sales of $6.1 million vs $6.6 million and below analyst estimates of $7.1 million
EPS of $0.01 vs EPS of $0.02 and below analyst estimates of $0.02

The headline revenue for the quarter was clearly disappointing. However, It’s important to understand that the company’s revenue currently consists of two sources:

Core recurring revenue (CRR) generated from patients receiving drug therapies using KRMD’s infusion pump platform.
Revenue generated when pharma companies use KRMD’s platform during clinical trials (CTR).

Our bullish thesis has always been based on CRR. CTR revenue is nice when it happens, but it can come in chunks and mask the growth in CRR. After listening to the call, it appears that CRR grew around 20% for the 9 months and 13% for Q3 ($5.2M vs. $4.6M).

Now, CTR related business is very important to the company because once a therapy is approved after going through clinical trials, new patients will start using KRMD’s platform to infuse the new therapy, leading to new, very meaningful, sticky CRR.

For example, KRMD’s platform is expected to be used in conjunction with a new therapy to treat paroxysmal nocturnal hemoglobinuria (PNH), a rare blood disease that causes red blood cells to break apart, a process doctors call "hemolysis." On the Q3 conference call, the CEO commented that an additional $3M in annual CRR could result if just 2,000 patients of the total 15,000 PNH patient target market used KRMD’s solution. One thing to keep in mind is that the company has been more aggressive in working with pharma companies during clinical trials than in the past, so we will have to just expect more lumpiness in CTR.

Also, COVID-19 may be slowing down some of the company’s potential clinical trial pipeline activity and prescriptions written to new patients for therapies related to indications that KRMD’s solutions currently address.

Regardless, there is no way to paint a rosy picture for Q3. We would have liked to see Q3 CRR growth at near 20%. However, after following the stock for around 13 years, we’ve come to know that it is not uncommon for KRMD to occasionally report subpar CRR for a quarter.

We are going to have to talk to management and monitor Form 4 activity to see if activist investor Joseph Manko steps up to the plate to add to his already sizable position.

Press Release Commentary

“We are continuing to manage our operations to deliver growth by capitalizing on multiple, sustainable long-term growth drivers. We remain confident in the strength of our core business, which is predominantly comprised of recurring revenues and excludes clinical trials. Our core business is likely to continue to grow given the heightened awareness of PIDD and CIDP diseases, proven and effective immunoglobulin therapy, the benefits of at home treatment, growing addressable patient populations, and an increasing focus by pharmaceutical manufacturers to develop subcutaneous drugs that allow individuals to self-administer these therapies at home. We believe we remain well-positioned to further capture clinical trials sales, support expanded drug indications for existing therapies, and pursue international expansion as the effects of the pandemic subside. Our business fundamentals and cash position remain strong.”

Growth Initiatives:

“The Freedom System was utilized in a recently completed Phase III clinical trial for a subcutaneous hematology drug. This drug is aimed at treating paroxysmal nocturnal hemoglobinuria (PNH), a rare, chronic blood disorder that affects over 15,000 patients worldwide. KORU Medical expects that this new drug will launch in 2021 and that the Freedom System will be the preferred delivery method. The Company also believes that the Freedom System will be utilized in several additional upcoming clinical trials with this same drug focused on expanding indications and disease states for larger patient populations.

“The new PNH drug is progressing towards its planned launch in 2021 and is currently being trialed in other indications using the Freedom System. Relationships such as this are an essential part of our strategic plan as this PNH indication alone has the potential to significantly expand our core business,”

Research

Fri, 04 Sep 2020 15:41:06 GMT

KORU Medical Systems (NASDAQ:KRMD) ($7.31; $320.9M market cap), a home infusion therapy medical device company, has seen a strong pullback in its shares. Yesterday we mentioned that activist investor Joseph Manko of Horton Capital, who was an aggressive buyer in the early days of KRMD, stepped back in, buying 6500 shares at $7.45. In another form 4 filed this morning, it shows that he has continued to buy the dip, adding another 25,000 shares at an average price of $7.25.

Yesterday, we issued a premium tweet alert, stating that we added some short-term trading shares around our core position (which we had previously disclosed that we had reduced at higher prices).

Research

Thu, 03 Sep 2020 18:02:24 GMT

KORU Medical Systems (NASDAQ:KRMD) ($7.45; $326.9M market cap), a home infusion therapy medical device company has seen a strong pullback in its shares. The stock has pulled back from highs of $12.84 to a low yesterday of $6.93. We had wondered if it was possibly Horton Capital selling some of its large stake, as the most recent 13D/A showed a very minor decrease from the prior year filing of 12.1 million shares to 11.7 million (we believe probably due to admin or tax reasons).

However, a form 4 filed this morning shows that Horton Capital managing partner Joseph Manko actually purchased shares yesterday in the open market. Adding 6500 shares at $7.45. While this is a small amount of shares, it is nice to see him step in and buy as the stock has seen weakness the past month. Previous to this buy, it looks like Manko's highest open market purchase price was around $2.20. Manko's previous buys have been a big consistent bullish indicator.

Research

Wed, 05 Aug 2020 17:55:51 GMT

KORU Medical Systems (NASDAQ:KRMD) ($10.94; $480.2M market cap), a home infusion therapy medical device company, announced Q2 2020:

Sales of $7.7 million vs $5.3 million in the prior year and ahead of analyst estimates of $6.5
Non-GAAP EPS of $0.03 vs $0.00 in the prior year and ahead of analyst estimates of $0.02. GAAP EPS was a loss of $0.03 but was due to a one-time $2.2 million litigation expense in the quarter.

“We believe that the awareness and diagnosis of Primary Immunodeficiency Diseases and Chronic Inflammatory Demyelinating Polyneuropathy - our primary end markets - is continuing to increase. We believe that COVID-19-related health concerns are driving the ongoing shift from hospital and clinic-based IVIg treatments to home-based subcutaneous Ig therapy, and that the acceleration of this trend is supporting the adoption of KORU Medical’s mechanical, easy-to-use Freedom Integrated Infusion System which allows patients with immune diseases and other chronic conditions to self-administer their Ig drug therapy at home. The growing preference for at-home treatment is also, in our view, encouraging pharmaceutical companies to continue to develop subcutaneous Ig therapies and new drugs that can be administered at home.”

KRMD reported revenue that handily beat analyst estimates. Some Investors may focus on the headline GAAP EPS miss, but in actuality, KRMD beat EPS estimates after adding back charges. Overall this was yet another strong quarter for the company, easily exceeding our expectations.

Research

Fri, 19 Jun 2020 16:55:28 GMT

Repro Med Systems, Inc. dba KORU Medical Systems (NASDAQ:KRMD) ($10.23; $405.9M market cap), a home infusion therapy medical device company, announced the pricing of its public share offering of 3.1 million shares at $8.00.

We like the specific language the company used in the use of proceeds specific as opposed to most times when it's boilerplate in nature:

“KORU Medical currently intends to use the net proceeds from this offering primarily for general corporate purposes and working capital. General corporate purposes may include commercial expansion (including by acquisition), clinical trials and pharmaceutical initiatives, gross margin enhancement and new product innovations, as well as other uses.”

We are interested to see if KRMD may use this offering to try and acquire EMED, its main competitor with which it recently settled all prior litigation in regards to patent infringements.

In related news, KRMD also announced it will join the Russell 3000 and Russell 2000 as of June 29, 2020.

“Our addition to the Russell is another important milestone in the growth and evolution of KORU Medical,” said Don Pettigrew, President and CEO. “It reflects the substantial progress we have made over the past year in growing our business and creating long-term value for our shareholders. We are also confident that it will help to elevate our profile among investors. We remain focused on providing innovative, easy-to-use, at-home specialty infusion solutions that improve quality of life for patients around the world.”

All and all, we are happy to see that the company got this offering out of the way which shored up the balance sheet with minimal dilution.

Research

Wed, 27 May 2020 00:35:17 GMT

KORU Medical Systems (NASDAQ:KRMD) ($9.75; $387.0M market cap), a home infusion therapy medical device company, announced settlement of all pending litigation with EMED.

“The agreement provides KORU Medical with freedom to operate under EMED’s existing patent portfolio, dismissal of all litigation with prejudice, and an equity payment by KORU Medical to EMED.”

While this is certainly a positive development to finally end the ongoing litigation with EMED, we would like to see the terms of the settlement to gain a better understanding of the full impact of the news.

Research

Mon, 18 May 2020 04:00:00 GMT

**Calls To Action - INTZ, KRMD

In case you haven't read it yet, in our weekly wrap-up we mentioned we added shares of Intrusion Inc (OOTC:INTZ) on earnings pullback and lightened up on our Repro Med Systems, Inc. (NASDAQ:KRMD) position after a multi-year run. The stock has been part of our portfolio for 13 years and since we profiled it starting March 10, 2016 at $0.37, we just think it's the prudent thing to do. We still love the management team and where the company is headed.

Research

Tue, 05 May 2020 18:10:46 GMT

Repro Med Systems, Inc. dba KORU Medical Systems (NASDAQ:KRMD) ($10.23; $405.9M market cap), a home infusion therapy medical device company, announced Q1 2020 results:

Sales of $6.3 million vs $5.0 million in the prior year
EPS of $0.01 vs $0.00 in the prior year

“The Company continued in Q1 2020 to capitalize on the growth of its primary end markets of Primary Immune Deficiency Diseases (“PIDD”) and Chronic Inflammatory Demyelinating Polyneuropathy (“CIDP”) while pursuing longer-term growth initiatives, including broadening pharmaceutical relationships with an emphasis on the numerous new subcutaneous drugs coming to market, expanding indications beyond its primary disease states, and pursuing customers in new geographies...

...We are confident that KORU Medical will successfully navigate the challenges of COVID-19 and remain focused on achieving our long-term growth objectives,” continued Mr. Pettigrew. “We have not experienced any material disruption to our business thus far, continue to execute on our Strategic Plan, and are prudently managing working capital and cash flow. Longer term, we believe that the COVID-19 experience may accelerate the shift of drug infusion therapy to an at-home model and further advance the adoption of subcutaneous immunoglobulin drugs.”

Research

Wed, 26 Feb 2020 16:18:56 GMT

Repro Med Systems, Inc. dba KORU Medical Systems (NASDAQ:KRMD) ($6.88; $217.7M market cap), a home infusion therapy medical device company announced Q4 2019 results:

Sales of $6.2 million vs $4.3 million in the prior year
EPS of $0.00 vs $0.01 in the prior year

“2019 was a milestone year for KORU Medical,” said Don Pettigrew, President and CEO... We continued our participation in multiple clinical trials, accelerated our international expansion plans, strengthened our leadership team, and capped off our Nasdaq up-listing by ringing the closing bell...

As we look ahead to 2020, our focus is on capitalizing on multiple industry tailwinds in PIDD and CIDP, which combine to represent an estimated total addressable U.S. market of $300 million. We are also growing our pharmaceutical relationships with an emphasis on new subcutaneous drugs coming to market, expanded indications beyond our primary disease states, and new geographic regions. We look forward to the U.S. launch of the HIgH-Flo Super26™ Subcutaneous Safety Needle Set in Q1 2020, with anticipated full commercialization to follow shortly after.”

Revenues for this quarter were a pleasant surprise to us, as we thought the company would not come close to the $6.6 million reported in Q3 as that quarter benefited from some large orders from a new distributor, Mckesson, that recently acquired KRMD's main distributor.

Earnings per share were a small loss compared to 4th quarter 2018. So far we're not sure how the market will react to this comparison. However, the loss is primarily due to legal expenses related to a multi-year lawsuit with its major competitor, EMED Technologies - a lawsuit that that we hope will be resolved soon. So far, KRMD has been the victor in the legal battle proceedings. Eliminating legal expenses from both quarters would have resulted in earnings per share being positive and up for the 4th quarter, year over year.

While it's too early to tell, it appears that the company could be entering a new phase of top line revenue growth. This will be the key for shares to maintain a premium enterprise to sales multiple, which now stands at a lofty 12.9.

This morning, we will be listening to KRMD’s conference call for any information arbitrage that may be presented.

Research

Wed, 06 Nov 2019 15:40:46 GMT

Repro Med Systems, Inc. dba KORU Medical Systems (NASDAQ:KRMD) ($4.38; $163.4M market cap), a medical device company announced Q3 2019 results:

Sales of $6.6 million vs $4.5 million in the prior year
EPS of $0.02 vs $0.01 in the prior year
Non-GAAP EPS of $0.04 vs $0.02

“Net sales increased over 45% from Q3 2018, representing the third consecutive quarter of record net sales, and gross margin improved to over 66%. We continue to penetrate our primary disease state end markets, the growth of which we attribute to increasing awareness and diagnosis of PIDD and expanded therapeutic indications for CIDP. Our Freedom Syringe Infusion System is also being utilized in multiple clinical trials associated with the development of new subcutaneous therapies, which is an important component of our long-term growth strategy.”

Mr. Pettigrew concluded, “We also completed two significant corporate developments: the listing of our common stock on NASDAQ effective October 17 and our corporate rebranding to KORU Medical Systems. We believe that both developments reflect our continuing growth as a public company, and the new life and beginnings we provide to patients worldwide.”

KRMD (old REPR) was first profiled to our premium members on March 10, 2016 at $0.37. We then added to our Micro-cap Run to One Portfolio on October 4, 2016 at $0.44. Shares are now a ten-bagger, trading up over 1000% since being added to the portfolio.

We were not expecting the company to report revenues anywhere near what they reported for the quarter. We are not sure if this breakout quarter will be repeated, or if it was just due to unusually high orders from distributors. But in our opinion, it helps support premium valuation scenarios moving forward and the earnings leverage potential as revenues increase.

Research

Tue, 15 Oct 2019 14:54:35 GMT

In case you missed it, and as a follow up to yesterday's Tweet, Repro Med Systems Inc (OOTC:REPR) ($3.87; $148.5M market cap), a medical device company, announced during yesterday’s market open that its shares will commence trading on the NASDAQ on October 17, 2019.

“This NASDAQ listing is a significant milestone and a reflection of our growth and evolution as a publicly traded company,” said Don Pettigrew, President and CEO. “We believe that this listing will help to elevate the Company’s profile, expand our shareholder base, enhance trading efficiency, and support the pursuit of our long-term goals and objectives.

Our Freedom infusion system is widely accepted as the preferred means of subcutaneous delivery of immunoglobulin therapies, and we are committed to broadening our product portfolio with solutions that optimize therapeutic efficacy, promote compliance, and improve the overall patient experience. We reported record net sales for the first two quarters of 2019 and believe that our strengthened management team and board of directors, proactive operating strategy, and multiple industry tailwinds leave us well-positioned to continue to grow and maximize shareholder value."

With this news, REPR joins Stereotaxis Inc (OOTC:STXS) as the second of our top 5 stocks to be uplisted to a major exchange.

Research

Thu, 05 Sep 2019 18:26:35 GMT

Repro Med Systems Inc (OOTC:REPR) ($3.50; $134.3M market cap), a medical device company, received another favorable court ruling in its ongoing litigation with EMED Technologies (“EMED”). The Company announced that on August 30, 2019 the United States District Court for the Southern District of New York (Case No. 1:18-cv-05880-LGS) issued a decision granting RMS Medical’s motion for summary judgement of non-infringement against EMED U.S. Patent 9,808,576 (“576 Patent”) and dismissed the case with prejudice.

“We are very pleased with the decision of U.S. District Court for the Southern District of New York, which confirms our belief that EMED’s infringement claim was without merit,” said Don Pettigrew, President and CEO of RMS Medical. “This ruling is the second consecutive favorable judgement that we have received regarding our ongoing litigation with EMED.”

On November 7, 2017, EMED filed this case in the United States District Court for the Eastern District of Texas claiming patent infringement of the ‘576 Patent by the Company’s needle sets and seeking unspecified monetary damages. The case was later transferred to the United States District Court for the Southern District of New York and is one of several pending between RMS Medical and EMED.

On June 28, 2019, the United States District Judge for the Eastern District of Texas dismissed with prejudice EMED’s case on an earlier issued patent against RMS Medical and awarded court costs to RMS Medical. Subsequent to the Texas ruling, RMS Medical authorized its legal counsel to pursue recovery of legal fees from EMED associated with the Texas case.

Research

Wed, 07 Aug 2019 16:20:03 GMT

Repro Med Systems Inc (OOTC:REPR) ($3.05; $116.0M market cap), a medical device company (infusion pump system), announced Q2 2019 results:

Sales of $5.3 vs $4.5 million in the prior year
EPS of $0.00 vs $0.01 in the prior year
GEO Adjusted EPS of $0.04 vs $0.02 in the prior year

“We believe that momentum is building across our enterprise, which is reflected in improved financial performance, the scaling of our business to pursue anticipated growth opportunities, and the ongoing penetration of the PIDD and CIDP markets,” said Don Pettigrew, President and CEO of RMS Medical. “As a result, net sales of $5.3 million in the second quarter of 2019 represented the second consecutive quarter of record net sales.

“We are continuing to position RMS Medical as the preferred drug delivery partner for specific infusion therapies in select markets. This includes developing new products and exploring new indications for our existing product portfolio, strengthening our industry relationships, and working closely with drug manufacturers as they develop and introduce new subcutaneous therapies for which RMS Medical’s safe, easy-to-use, and cost-effective Freedom infusion system can become the delivery mechanism of choice.”

It was nice to see the company report revenue of over $5 million for two consecutive quarters. It eclipsed quarterly revenues of $5 million for the first time in Q1 2019. We assumed that this was mainly the result of realizing revenue that was originally expected to be earned Q4 2018. Not only did the company report revenue of over $5 million in Q2 2019, but it was also sequentially higher than Q1 2019.

The company did not grow GAAP EPS for the quarter, mainly due to increased legal expenses, which we expect will dissipate over time once REPR hopefully resolves its multi-year legal battle with a competitor. Whether or not this will be a reason for investors to take a tepid stance on the company remains to be seen.

We have been on the quarterly conference call that started at 9 a.m. EST and hope management offers more color on its fiscal 2019 outlook and any new partnerships/product news developments.

Research

Tue, 23 Jul 2019 15:37:46 GMT

Repro Med Systems Inc (OOTC:REPR) ($3.29; $126.0M market cap), a medical device company (infusion pump system), has been a top performer on this list for 2019, rising 98% YTD. We were a little worried that REPR's new management team, finalized in February 2019, would face challenges when trying to pick up where the prior CEO left off, especially with regards to maintaining business relationships. Part of this opinion arose from the old CEOs public comments on concerns he had about the ability of the new team to grow the Company. However, activist Joe Manko's push to upgrade the board and management team is working. So far, he is winning 1-0 as he was part of a group that bought the previous CEOs stock at $1.20 in December 2018. Furthermore, the new management team has delivered on some of their important short-term growth objectives as well as laid out its longer term goals:

Received 510(k) clearance from the U.S. Food and Drug Administration for its HIgh-Flo Super26™ Subcutaneous Needle Sets.
Announced a favorable final judgment as part of its litigation with EMED Technologies
REPR is to become the premier pump supplier for the recently FDA approved Grifols’ drug, Xembify
"laid a solid foundation and developed a game plan to achieve our goals by the end of 2022 of $50 million net revenues, 70%+ Gross Margins and 20%+ annual organic revenue growth for each year."

The things we would like management to address on its Q2 earnings call are:

Expand on above-mentioned Grifols supply agreement
Uplisting timeline
Update on remaining EMED legal issues
Product expansion

Regarding the Grifos news, we don't think the market has fully picked up on this, as the company did not issue a related press release about it. Even though the development was announced by Grifols on July 4, 2019, the company press release did not mention REPR’s role as the premier pump supplier. This development is important because expanding the number of drugs that can be used with REPR's infusion system is a critical part of the company's growth objectives. Furthermore, we are firm believers that once REPR establishes a few partnerships with multiple pharma companies, it's going to be an ideal takeover candidate at a premium price to sales multiple. It's unclear if new pharmaceutical relationships are included in the company's guidance, but we don't think this to be the case.

We would also like the company to address the steps it may be taking to potentially list on a higher exchange, now that stock is trading over $3. It is our belief that the company now meets the required standards to list on the NYSE or NASDAQ, and we would like to see if management plans to move forward with this goal.

Finally, we would like the company to provide an update on what inning it's in with its ongoing patent infringement lawsuit against EMED. So far, the company has won most of the major battles. We would love it if the company provided a worst-case scenario.

Shares are currently trading at an EV/Sales of 6.6. Normally we would set a fair value between 4 and 6 with recurring revenue medical device business models. However, the company has traditionally traded at elevated multiples, given its leading market share position and track record of consistent year-over-year revenue growth. We do think at some point the company can obtain a multiple of 8 to 10, with the potential of an outlier run above that if it continues to execute. Additionally, we can see the valuation coming down significantly if revenue growth accelerates if the company is able to land relationships with more pharmaceutical companies. (as sales increase, P/S and EV/S multiples decrease)

The major risk with the story is that the company is still a one product company. We will ask the CEO to address this subject on their Q2 earnings call. Of course, with any medical device company, we need to worry about product recall risk and innovation from competition.

Financials

Tue, 23 Jul 2019 13:23:02 GMT

Research

Tue, 09 Jul 2019 14:55:54 GMT

Repro Med Systems Inc (OOTC:REPR) ($2.98; $114.1M market cap), a medical supply company sees shares continue to hit new highs. On June 21, 2109 we highlighted a Craig-Halluma initiation of research report with its Buy rating and $5.50 price target for REPR. You can see that initial report here.

Yesterday, late in the day, Craig-Hallum issued a follow-up report showing that REPR is to become the premiere pump supplier for the recently FDA approved Grifols’ drug Xembify. A snapshot from the report reads:

We view this development as a big win for REPR and the new management team. A large part of REPR's next leg of growth is getting an FDA approval that will allow new drug therapies to be infused through its infusion pump system.

This development probably explains the late day volume that came into REPR, yesterday. So far, around the web, we haven't found the news that REPR has become the premier supplier of Xembify. However, you can see a release regarding Xembify receiving FDA approval here.

Research

Wed, 03 Jul 2019 14:58:26 GMT

Repro Med Systems Inc (OOTC:REPR) ($2.85; $109.2M market cap), a medical supply company, announced a favorable final judgment in its litigation with EMED Technologies.

“...on June 28, 2019 the United States District Judge for the Eastern District of Texas (Case No. 2:15-CV-01167-JRG-RSP) issued a Final Judgment in favor of RMS Medical in the Company’s previously announced litigation with EMED Technologies (“EMED”) before that court. The District Judge adopted the decision of the Magistrate Judge that was issued on June 24, 2019, overruled EMED’s objections, awarded court costs to RMS Medical, and dismissed the case. This case was one of several pending between RMS Medical and EMED.”

Legal Insights

Thu, 27 Jun 2019 17:38:05 GMT

Repro Med Systems Inc (OOTC:REPR) ($2.87; $111.1M market cap), a medical supply company, announced that on June 24, 2019

“the Texas Court Magistrate Judge issued a Report and Recommendation decision with respect to the ED Texas ’476 matter finding no infringement, literally or under the doctrine of equivalents, by the Company’s accused products”

While EMED Technologies Corporation (“EMED”) filed an objection to the decision, it seems we are nearing the end to the long-standing legal battle between REPR and EMED over the patent infringement suit.

Analyst Reports

Fri, 21 Jun 2019 12:28:05 GMT

June 2019 Craig-Hallum Analyst Report

Research

Wed, 01 May 2019 04:00:00 GMT

Repro Med Systems Inc (OOTC:REPR) ($1.65; $63.9M market cap) a medical supply company, announced Q1 2019 results:

Sales of $5.0 million vs $4.0 million in the prior year
Non-GAAP EPS of $0.01 vs $0.01 in the prior year

“The operational momentum we created in 2018 continued into Q1 2019,” said Don Pettigrew, President and CEO of RMS Medical. “We reported record quarterly net sales of $5.0 million, continued to expand our presence in the primary immunodeficiency diseases, or PIDD, and chronic inflammatory demyelinating polyneuropathy, or CIDP, markets, and maintained a strong financial position. In April, we received 510(k) clearance for our HIgh-Flo Super26™ Subcutaneous Needle Sets, reflecting our continuing focus on broadening RMS Medical’s portfolio of infusion products to improve the patient experience.”

We will be on this morning's call to see if the Company expands on the recent 501(k) clearance as well as any updates on the litigation discussed in the release with a competitor.

Research

Thu, 18 Apr 2019 14:26:47 GMT

Repro Med Systems Inc (OOTC:REPR) ($1.46; $56.3M market cap), a medical supply company, announced that it has received 510(k) clearance from the U.S. Food and Drug Administration for its HIgh-Flo Super26™ Subcutaneous Needle Sets.

The sets will be available as part of RMS Medical’s Freedom Integrated Infusion System, the only fully-integrated mechanical system cleared by the FDA for a wide range of medications and flow rates.

“This clearance reflects our commitment to broadening RMS Medical’s product portfolio with solutions that optimize the delivery and efficacy of subcutaneous therapies, promote compliance, and improve the overall patient experience,” said Don Pettigrew, President and Chief Executive Officer. “The Super26 Needle Sets support the shift towards faster SCIg infusions while addressing patient comfort concerns via the use of a smaller diameter needle. This could be very helpful in existing and new indications where large volumes of drugs are required to be infused.”

"RMS Medical continues to define itself as an industry leader,” said Daniel Goldberger, Executive Chairman. "New product introduction is an important component of our previously announced strategic plan. As we advance towards our vision of becoming the preferred drug delivery partner for specific infusion therapies in select markets, we will continue to focus on delivering innovative solutions to our growing industry.”

Research

Tue, 19 Mar 2019 14:26:49 GMT

Repro Med Systems Inc (OOTC:REPR) ($1.55; $59.8M market cap), a medical supply company which has been on our favorite stock list continues to see aggressive insider buying. We have covered the endless buying from director Joseph Manko of Horton Capital Management, but other directors have been following suit, as illustrated by yesterday's most the recently filed Form 4 showing that Director James Beck has purchased 35,000 shares at open market prices, at an average of $1.55.

Research

Wed, 13 Feb 2019 05:00:00 GMT

Repro Med Systems Inc (OOTC:REPR) ($1.63; $63.0M market cap), a medical supply company announced Q4 2018 results:

$4.2 million vs $4.1 million in the prior year
Non-GAAP EPS of $0.00 vs EPS of $0.01 in the prior year

It's important to note that sales were a little lighter than we expected this quarter due to timing of orders that were pushed into Q1. More importantly, it's nice to see the company has set mid-term goals regarding sales and gross margins.

“While Q4 2018 net sales were above those achieved in our strongest quarter of 2017, fourth quarter sales were sequentially lower versus Q3 2018, mostly due to the timing of orders received in December but shipped in January 2019.”

"2018 was a critical year for RMS," said Don Pettigrew, President and Chief Executive Officer of RMS Medical. "We refreshed our management team, strengthened our Board, entered into a new therapeutic indication and are preparing for future growth with the adoption of our Strategic Plan. Our record results in the past year are evidence of the strength of this organization, and the value of the FREEDOM Syringe Infusion System, and we are looking to expand on this strength as we drive towards our vision of becoming the preferred drug delivery partner for specific infusion therapies in select markets." Don continued, "We have laid a solid foundation and developed a game plan to achieve our goals by the end of 2022 of $50 million net revenues, 70%+ Gross Margins and 20%+ annual organic revenue growth for each year. While we may not always progress in a straight line, the team is focused on achieving these goals and I am confident we can get there."

Research

Mon, 04 Feb 2019 15:17:53 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.49; $57.5M market cap), a medical supply company announced new CEO and strategic plan. The Company announced that has promoted Don Pettigrew to Chief Executive Officer. Don was the the creator of the company's new strategic plan with the goal of becoming the leading subcutaneous drug delivery partner for targeted markets on a global level.

"As an industry leader in the home infusion market, RMS delivers invaluable medical and lifestyle solutions to patients who rely on our products," said Don Pettigrew, President and CEO. "My vision as CEO is to innovate and improve our products such as the FREEDOM system, partner with the medical community to identify new patient needs and expand our reach in the US and abroad. Achieving these goals is a win-win for patients, providers and shareholders alike," said Pettigrew.

The Company also announced that it will release its full year 2018 results on February 12 and hold a conference call on February 13, where it plans to outline its strategic plans.

Research

Mon, 17 Dec 2018 17:12:16 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.47; $56.1M market cap), a medical supply company recently presented at the LD Microcap conference. Below is a summary of the presentation:

Expects $17.5 million or slightly more for sales in 2018, implying a $4.5 million Q4 2018 ($4.1 in Q4 2017).
Sales have been growing at a rate in the high teens (percent) and management expects that to continue
New senior leadership focused on growth & value creation
Expects gross margins to continue to improve as sales grow
Very large target market

Product is simple and inexpensive, perfect for the home health care market
Looking to expand indications product can be used for
Seven straight quarters of improved operating income
Very clean capital structure (no debt)

Substantial long term tailwinds

Plans to uplist in the coming months

You can listen to the full presentation here and see our full coverage on REPR here.

Conference Call Notes

Thu, 01 Nov 2018 17:31:06 GMT

GB Repro Medsystems (OOTC:REPR) ($1.57, $59.9M market cap), a medical device company, announced Q3 2018 results on October 24, 2018. The company has continued its momentum and continues to see positive trends for growth for existing products. The company also continues its R&D for new products as well as building new relationships with some pharmaceutical companies. Noteworthy conference call commentary:

Operating Leverage:

“We are starting to see powerful leverage in our income statement because of the growing revenue and gross profit while we maintain discipline around operating expense. Operating profit should continue to expand as those trends continue into 2019 and beyond.”

Continued growth:

“Moving forward I’m very confident that sales will continue to grow in Q4 as well as 2019.”

Market Growing:

We are in a great position where we can secure business from the top-down and bottom-up approach with our largest customers. I will personally be leading the efforts to secure relationships at the executive level while the sales team will drive business at the local level. Our ability to strengthen these relationships will ensure we grow at a minimum with a market that’s likely expanding in a double-digit rate.

Pharma Partnerships:

I feel one of the biggest opportunities is to collaborate with our industry partners including pharmaceutical companies, other home infusion suppliers and distribution partners. Focusing our efforts here will allow us to expand our reach to partners that not only share a common call point but also expand our reach to the physician level and potentially position us to participate in future clinical trials.

New Growth Opportunities:

We are currently on-label for a variety of antibiotic therapies and will continue to look for revenue opportunities in that category. I also believe that we have untapped opportunities in hospice care to deliver nutrition and hydration. And finally, the FREEDOM system may ultimately be useful in secondary therapy or therapy for immunology oncology patients. With all those opportunities ahead of us I look forward to investing in our product development activities and securing future growth.

Research

Wed, 31 Oct 2018 15:04:48 GMT

GB Repro Medsystems (OOTC:REPR) ($1.50, $57.2M market cap), a medical device company, continues to see open market share purchases from Director Joseph Manko, despite the stock being near all time highs. In a Form 4 filed yesterday, it shows Manko added another 30,000 shares at prices of around $1.48, putting his total stake at near 6.5 million shares, compared to ex-CEO Andrew Sealfon’s stake of 8.1 million shares.

We continue to track Manko and his buys, as it is possible he may try to surpass Sealfon’s stake in light of his current proxy fight for control of the Company. Either way, it adds a level of support to current prices.

Research

Wed, 24 Oct 2018 14:54:51 GMT

GB Repro Medsystems (OOTC:REPR) ($1.45, $55.4M market cap), a medical device company announced Q3 2018 results:

Sales of $4.5 million vs $3.8 million in the prior year
EPS of $0.01 vs $0.01

''The third quarter saw continued momentum from the positive trends in home use of Subcutaneous Immunoglobulin Therapy driving the growth of RMS Medical Products,'' stated Dan Goldberger, Chairman and interim CEO. ''We are thrilled to have Don Pettigrew, an experienced infusion industry executive, as our new President and Chief Commercial Officer. Don is leading our strategic planning efforts as well as overseeing all sales and marketing activities at the company, and has hit the ground running. Our focus remains on our mission to improve the quality of life of patients around the world through the design, development and delivery of the highest quality innovative therapeutic solutions. Patient safety, product efficacy, customer service, and shareholder value continue to be our highest priorities.''

Mr. Goldberger continued, ''The addition of Don Pettigrew and our increased investments to support R&D and clinical trial activity should lay the foundation for long term success. We are starting to see leverage in our income statement from expanding gross margins and control of operating expenses. Our balance sheet shows substantial cash resources and zero debt. All of this bodes well for future, profitable growth.”

During the associated conference call which we attended, management stated that they believe growth will continue into Q4 and for 2019. You can see our full coverage on REPR here.

Research

Mon, 17 Sep 2018 15:11:21 GMT

GB Repro Medsystems (OOTC:REPR) ($1.45, $55.4M market cap), a medical device company, continues to see share accumulation from one of its directors. Last week, we highlighted a possible coming proxy fight between the ex-CEO and the current board (in particular Joseph Manko, who has been steadily acquiring shares over the past year). Last week, Manko filed yet another two Form 4’s showing he added another 130,000 shares, bringing his total to 6.4 million shares. With ex-CEO Andrew Sealfon holding 8.1 million shares, it is possible Manko will continue to buy shares until he surpasses Sealfon, with the intention of holding more voting rights power than him.

Research

Mon, 10 Sep 2018 14:28:13 GMT

Repro Medsystems (OOTC:REPR) ($1.45, $55.4M market cap) - Director Joseph Manko continues to make open market purchases, filing another Form 4 on Friday indicating that he acquired roughly 69,000 more shares. Also on Friday a Form 13D/A was filed by Andrew Sealfon and Dr. Paul M. Baker who seek to remove all of the company’s Board members and replace the company’s CEO. Under “Purpose of Transaction” they make it clear that they are considering a proxy fight and state their main objectives as:

The removal of four directors: David W. Anderson, Daniel S. Goldberger, Joseph M. Manko, Jr, and Arthur J. Radin; and
The appointment of two or four new directors, with prospective nominees to be named before or at the Special Shareholders’ Meeting.
The removal of Daniel S. Goldberger (“Mr. Goldberger”) from all positions with the Company; and
The appointment of new individual(s) to replace Mr. Goldberger across all positions.

Sealfon is the founder of the company and its former CEO who remains on the board, but was ousted by a new board put in place by Manko. At this point, we presume it will be a battle for control of the company between the two. We will continue to monitor the status of this potential activist situation going forward.

Research

Thu, 06 Sep 2018 15:26:54 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.32; $50.4M market cap), a medical device company, presented at the 7th Annual Liolios Gateway Conference in San Francisco yesterday. The company talks about its strong growth and its large addressable market. The Company offers a 2018 revenue run rate of $17 to $18 million and states plenty of room to run based on huge market opportunity.

On page 4, RMS highlights the following stats w/r/t market opportunity:

$15.9B - 2014 GLobal home infusion market, growing at a 9% CAGR to $26.7B by 2020
$1.3B - 2016 North American market for subcutaneous IG (SCIg), growing at a 14% CAGR from 2016-2024
$500M - U.S. home Infusion Equipment Market (2018) growing more than 10% annually 2019-2024

Sources: Transparency Market Research, US CDC, NIH, Grand View, Research, MSD Healthcare Solutions, Immune Deficiency Foundation, Management Estimates

We encourage you to listen to the full presentation which can be found here.

Research

Tue, 07 Aug 2018 14:20:38 GMT

** Model Portfolio Update

We are also adding long-followed stock Repro Med Systems (OOTC:REPR) ($1.37, $52M market cap) to “Maj’s Favorites” after yesterday’s favorable earnings report, highlighted below.

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Repro Med Systems (OOTC:REPR) ($1.37, $52M market cap), a company that engages in the design, manufacture, and marketing of proprietary medical devices primarily for emergency medical applications and ambulatory infusion therapy worldwide, announced its second quarter results yesterday after the bell:

EPS of $0.01 vs. $0.00
Revenue of $4.5 million vs. $3.8 million
Net Sales for the quarter ended June 30, 2018 increased 17.6% over the same period last year
Net Income increased to $475,723 or 10.6% of Net Sales

Management commentary:

"Second quarter results were strong as RMS continues to grow market share within its core indications, as well as pursue new opportunities," stated Dan Goldberger, Chairman and interim President and CEO. "As we undergo the next phase of RMS's development, I want to assure all of our stakeholders that we will continue to pursue our mission to improve the quality of life of patients around the world through the design, development, and delivery of the highest quality innovative therapeutic solutions. Patient safety, product efficacy, respect for all of our stakeholders, customer service, and building shareholder value continue to be our highest priorities."

We will be on the company’s 9AM call this morning and will be reviewing its 10-Q for any additional information. We are adding REPR to our Maj’s Favorite’s screen, despite the stock moving up sharply since we first started looking at it.

Research

Thu, 26 Jul 2018 15:32:52 GMT

GB ReproMed Systems (OTCQB:REPR) ($1.24, market cap $47.18M), a company that engages in the design, manufacture, and marketing of proprietary medical devices primarily for emergency medical applications and ambulatory infusion therapy worldwide, today announced strong quarterly sales growth and leadership changes. The company commented in this morning's press release:

Quarterly Net Sales increased 17.6% over the comparable period.
Fifth consecutive quarter of net sales growth.
Announced appointment of Dan Goldberger as Chairman and interim Chief Executive Officer, replacing Andrew Sealfon.
On August 6, 2018, the Company is to announce financial results for the quarter ended June 30, with an accompanying conference call August 7th.

The company announced that:

Net Sales grew for the fifth consecutive quarter to $4.5 million, a 17.6% increase over $3.8 million reported during the second quarter of 2017. The increase in Net Sales was driven primarily by higher sales of needle sets. In addition, RMS Medical's Board of Directors has elected Daniel Goldberger, Board Member, to the position of Chairman and interim President and Chief Executive Officer.

Management’s commentary:

"I look forward to building on the foundation that Andy has laid over thirty years and we appreciate his service," said Dan Goldberger, RMS Medical's interim Chairman, President and Chief Executive Officer. "The invention of the Freedom60 has improved the lives of thousands of chronically-ill patients around the globe, and RMS' portfolio of products has enormous application potential. Andy's long list of accomplishments has positioned RMS well for strong long-term growth of revenue and shareholder value."

You can read all of our past coverage on REPR in our portal here. We are currently long REPR.

Research

Mon, 14 May 2018 14:53:41 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.50; $57.0M market cap), a medical device company, continues to see buying from Director Joseph Manko Jr despite the stock’s recent runs to new highs. On Friday shares hit and closed at new 52 week highs of $1.50. After hours, Joseph Manko filed yet another form 4 filing showing he had added 24,274 shares earlier in the week. Mr. Manko now owns roughly 16.5% ot the total shares outstanding.

Comments & Business Outlook

Mon, 07 May 2018 16:59:08 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.37; $52.0M market cap), a medical device company announced Q1 2018 results:

Sales of $4.0 million vs $3.6 million in the prior year
EPS of $0.01 vs $0.00

Results are currently only via the 10-Q filing. Highlights from the management discussion and analysis portion:

The results of this year’s first quarter are an increase in net sales of 10.9% as compared with the same period last year, which included some variability due to a one-time back order issue. For 2018, we anticipate growth in our needle set sales including an updated Super 26g High Flo administration set, and general organic growth supported by a comprehensive updated new FDA clearance per the RMS “Integrated Catch-Up Freedom Syringe Drive Infusion System” which became effective on August 31, 2017. The expanded clearance includes specifications for use with Cuvitru® and Hizentra®, as well as intravenous antibiotics. The Super 26g High Flo administration set was developed specifically to support recent approval of immunoglobulins for the neurological treatment of Chronic Inflammatory Demyelinating Polyneuropathy (“CIDP”). Our gross margin percentage increased from 57.7% to 61.1% quarter over quarter, driven by ongoing operational efficiencies. With improved sales, better margins and level operating expenses, net income improved significantly. In addition, we expect many of the SCIg providers, and others, will see benefit in using the FREEDOM System for additional uses such as neurology, antibiotics, chemotherapeutics, and pain medications.

Research

Tue, 10 Apr 2018 04:00:00 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.30; $49.4M market cap), a medical supply company, announced that the United States Court of Appeals for the Federal Circuit shot down EMED's appeal and that nine of the ten claims in EMED's patent were invalid.

Quotes from management:

"The court's decision further validates RMS's leading status as an innovator in home infusion. While we are pleased with the result, we want to assure our partners that despite all of this unwarranted legal interference, RMS remains focused on its mission to improve the quality of life of patients around the world."

For further background on the legal case, and more details of the appeals, please see the full release here.

We are looking into what the one remaining open claim is and any potential impacts to REPR should there be a judgement in EMED’s favor.

Please see our history of REPR coverage here.

Research

Thu, 15 Mar 2018 15:14:39 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.30; $49.4M market cap), a medical supply company, nominated Daniel Goldberger to the Board of Directors.

"As part of the comprehensive strategic review announced November 22nd, in an effort to prepare the Company for anticipated growth, the Board of Directors is committed to strengthening its membership and governance. We are very pleased to nominate Dan and thank Brad for his service to the Company. We have nominated Dan to join our board because he will bring valuable expertise and a new perspective to our business," said Andy Sealfon, RMS Chairman, and Chief Executive Officer. "Dan has extensive executive and board experience in the healthcare industry and will be instrumental to the board in guiding our growing Company to continue to drive shareholder value.

Mr. Goldberger has held senior leadership and board of directors positions at high growth medical technology companies including Xtant Medical Holdings, Sound Surgical Technologies LLC, Xcorporeal, and Glucon. As Chief Executive Officer of Xtant, he oversaw a tripling of sales from $30 million to $90 million over a three and one-half year period. He also guided Xtant through a period of improved profitability and substantially increased shareholder value. With Sound Surgical, he helped boost revenue from $9 million to $40 million over six years through a strategic restructuring and new product development.”

It seems like activist investor Joseph Manko Jr. is beginning to clean house. In November 2017, the company announced that the Board, in preparation for accelerated growth, has committed to strengthening its membership and governance in the coming months. The hiring of Daniel Goldberger to the Board and the continued search to replace the CEO Andy Sealfon seem to be the first steps in this process.

Research

Tue, 06 Mar 2018 18:07:43 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.41; $53.4M market cap), a medical supply company, reported its Q4 2017 results in mid February. Yesterday after the close, REPR filed its 10-KT (transitional 10-K due to fiscal year change). While we already highlighted the company’s strong financial results back in mid February, we’d still like to highlight some takeaways from the 10-K.

New product initiatives:

We recognize the importance of innovation and renovation to our long-term success and are committed to research and new product development activities. Our product development team engages in consumer research, product development, current product improvement and testing activities, and also leverages our development capabilities by partnering with a network of outside resources. We spent $50,587 on research and development for the ten months ending December 31, 2017 and $237,486 for year ending February 28, 2017. We are actively recruiting for open positions in our research and development department.

During fiscal 2017, we launched our new Controller and defined a product pipeline that enhances our current product offerings as well as broadens the range of products available. We expect to launch three new products within the next six to twelve months. These include new flow rate tubing to achieve maximum flow rates of new SCIg drugs with the smallest needles, a clearance for our variable rate flow controller for use of RMS stated flow rates, and a new addition to the subcutaneous administration needle sets which will initially be positioned to the unique needs of the neurology market. A provisional patent application has been filed for this needle set as a first step in seeking enforceable patent rights for this new and advantageous invention.

Freedom 60 Opportunity due to lack of coverage from health insurance:

The 21st Century Cures Act, which went into effect January 1, 2017, changes the payment structure for infusion drugs under the Part B Durable Medical Equipment (DME) benefit. Previously, the reimbursement rate covered service-intensive clinical therapies to administer drugs for heart failure and immunotherapy infusions. However, section 5004(a) of the Cures Act reduces the drug reimbursement structure, and there is no separate reimbursement for the services required to deliver these infusion services. While section 5012 includes a separate service payment, it doesn’t become effective until 2021. This means a gap of four years without home infusion coverage for many Medicare patients. Because the FREEDOM System is less costly than most competitive products, more Medicare patients may turn to the FREEDOM System during that gap.

Continued geographic expansion:

Internationally, the Company has engaged in clinical trials with a number of different drug companies in several countries. In January 2017, the umbrella organization of the public health insurance in Germany approved the FREEDOM System for reimbursement, and it was registered and listed in the Medical Device Registry in the category of mechanical infusion pumps. It is the only device of its kind registered within Germany. We continue our efforts to obtain registrations in other countries, which on average can take anywhere from twelve to eighteen months.

And lastly, in related news, the continuous aggressive buying from Director Joseph Manko Jr continued on Friday, with another 35,000 shares at open market prices of $1.37. This recent purchase marks the third Form 4 in the last two weeks. Manko now holds a roughly 16.4% stake in the company.

Research

Wed, 28 Feb 2018 15:21:45 GMT

GBRepro Med Systems Inc (OOTC:REPR) ($1.35; $51.0M market cap), a medical device company, continues to see aggressive buying by director Joseph Manko. Five days after our last note that showed Manko adding over 100,000 shares to his already massive stake of over 6 million, he has filed another form 4 yesterday adding an additional 58,000 at average price of $1.34.

Research

Fri, 23 Feb 2018 18:35:35 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.35; $51.0M market cap), a medical device company, continues to see aggressive buying by director Joseph Manko Jr. In a Form 4 filed yesterday after hours, Manko disclosed adding another 109,300 shares to his already massive stake of over 6 million shares. The shares were purchased in the open market at an average price of $1.30. Manko now has a 16.2% stake in REPR.

Comments & Business Outlook

Wed, 14 Feb 2018 15:38:01 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($1.07; $40.5M market cap), a medical supply company announced Q4 2017results:

Sales of $4.1 million vs $2.8 million in the prior year period
EPS of $0.01 vs $0.00 in the prior year period

Quotes from management:

"I am so pleased to announce that due to the outstanding performance and expanded market acceptance of our FREEDOM Syringe Infusion System, as well as the confirmation by the FDA of the unique technology supporting the use of our system for subcutaneous medications including Hizentra® and Cuvitru®, as well as for intravenous uses such as antibiotics, we experienced our best year ever in the Company's history for net sales and profitability. With new markets opening, planned introduction of new products this year, multiple new clinical trials underway, and international market expansions, we believe we are well positioned for future growth."

Looks to be first time the Company has surpassed $4 million in sales for a quarter.

Research

Tue, 13 Feb 2018 17:47:15 GMT

We came across a little information arbitrage (InfoArb) that might be relevant to GeoBargain Repro Med Systems Inc (OOTC:REPR) ($1.07; $40.7M market cap). Our earnings research last week uncovered a press release issued by Bioscrip (NASDAQ:BIOS) ($2.95; $379.9M market cap) regarding benefits payments for Medicare Part B home infusion services:

“U.S. Congress today passed the Medicare Home Infusion Therapy Access Act of 2017 (H.R. 3163/S. 1738) as part of the Continuing Resolution. The legislation provides for a transitional benefit payment, beginning January 1, 2019, for Medicare Part B home infusion services, which will continue until the commencement of a permanent payment structure under the 21st Century Cures Act, currently expected to take effect in 2021. BioScrip believes that enactment of this legislation will add a minimum of $9 million of EBITDA for the Company in 2019 (about a 20% bump based on the current annual EBITDA run-rate).”

Medicare Part B covers:

“physician services, outpatient hospital services, certain home health services, durable medical equipment, and other items.”

How this may eventually positively impact REPR remains to be seen, but after reading its filings we noticed that the product appears to be classified as “Durable Medical Equipment.” An update will be provided if we find or hear anything that would lead us to raise our expectations for possible outcomes for REPR, and vice versa.

Research

Tue, 26 Dec 2017 15:23:32 GMT

Shares of medical device company GB Repro Med Systems Inc (OOTC:REPR) ($0.92; $34.8M market cap) have been boosted by the continuous insider purchases from Director Joseph Manko Jr., as well as the recent closing out of its FDA warning letter last month. You can see our full coverage on REPR here.

During Friday’s trading session REPR reached the $1.00 mark for the first time. REPR is part of our Micro-cap Run to One Portfolio, being added on October 4, 2016 at $0.44. Shares are now up 122% since being added to the portfolio.

Research

Mon, 18 Dec 2017 17:11:47 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($0.92; $34.8M market cap) - Another day, another form 4 from director Joseph Manko Jr. that shows he purchased yet another 396,692 shares at open market prices of $0.90. We believe this is his largest open market purchase to date, equating to over $350,000 worth of shares in the last 3 trading days.

Research

Wed, 13 Dec 2017 18:06:14 GMT

GB Repro Med Systems Inc (OOTC:REPR) ($0.83; $30.3M market cap), is a medical device company. Another day, another form 4 from director Joseph Manko Jr. that shows he purchased yet another 137,225 shares at open market prices of $0.90.

It was just a few days back when we highlighted some of Manko’s recent buying spree. Yesterday’s form 4 marks the 5th form 4 since early November. Manko now owns 5.6 million shares or a 14.7% stake in REPR.

Research

Fri, 08 Dec 2017 17:01:48 GMT

GB Repro Medsystems (OTCQX:REPR) ($0.86; $32.6M market cap), a medical device company, is seeing continued insider buying from director Joseph Manko Jr. In a form 4 filed yesterday after the close, it shows Mr. Manko bought 50,000 shares on the open market at $0.84 per share. This adds to his already large stake of over 5.5 million shares. Yesterday’s filing is the fourth form 4 from Mr. Manko since early November.

It was in late November when the Company had officially closed its FDA Warning Letter that was issued on February 26, 2016. You can see our full coverage on REPR here.

Research

Mon, 04 Dec 2017 16:50:57 GMT

GB Repro Medsystems (OTCQX:REPR) ($0.83; $30.3M market cap), a medical device company, is seeing non-stop buying from director Joseph Manko Jr. Just last week Mr. Manko added roughly 220,000 shares to his already large stake in REPR of over 5 million shares. Friday after the close, anotherform 4 filing showed that Mr. Manko purchased yet another 77,000 shares at prices between $0.80 and $0.83.

Research

Wed, 29 Nov 2017 17:32:08 GMT

GB Repro Medsystems (OTCQX:REPR) ($0.80; $30.3M market cap), a medical device company, is seeing continued insider buying from director Joseph Manko Jr. In a form 4 filed yesterday after the close, it shows Mr. Manko bought over 220,000 shares on the open market at $0.80 per share. This adds to his already large stake of over 5 million shares.

Last week we highlighted that the Company had officially closed its FDA Warning Letter that was issued on February 26, 2016. You can see our full coverage on REPR here.

Research

Fri, 24 Nov 2017 16:29:48 GMT

GB Repro Medsystems (OTCQX:REPR) ($0.71; $27.2M market cap), a medical device company, announced on Wednesday after the market closed that the FDA officially notified RMS that the Warning Letter issued on February 26, 2016 has been officially resolved.

“The final chapter of closing the Warning Letter confirms that FDA has found RMS to have adequately addressed all the concerns raised in the Warning Letter. This effort was conducted under the outstanding leadership of our Chief Medical Officer, Dr. Fred Ma."

The company also announced some organizational updates:

Eric Bauer has resigned from his position of Chief Operating Officer, effective November 17, 2017, to pursue other opportunities and has agreed to assist RMS with an orderly transition.

As part of the strategic review, the Board of Directors, encouraged by the CEO and Chairman of the Board, Andrew Sealfon, has initiated a search to find a qualified successor for Mr. Sealfon as CEO as soon as practicable. Mr. Sealfon continues to serve as CEO until such successor has been appointed and Mr. Sealfon is anticipated to remain with the Company until his retirement.

Finally, in an effort to prepare the Company for anticipated growth, the Board of Directors has committed to strengthening its membership and governance in coming months.

We recently highlighted the InfoArb opportunity regarding the closure of the FDA warning letter in several of our past notes. You can see our full coverage on REPR here.

We believe this is excellent news for the Company moving forward and will hopefully bring investors in who were sitting on the sidelines waiting for this resolution. However, we are not quite sure how the market will react to the organizational changes taking place. We probably view any dip in the stock as a trading opportunity around our core position. One thing we need to get clarification on will be the attitude of a new management team regarding dilution to fund growth.

Research

Thu, 16 Nov 2017 18:01:10 GMT

GB Repro Medsystems (OTCQX:REPR) ($0.62; $23.4m market cap), a medical device company, recently announced its Q3 2017 results via 10-Q which we highlighted in our November 6, 2017 email. The company posted:

Sales of $3.8 million vs $3.2 million in the prior year
EPS of $0.01 vs $0.00

The company had only issued the 10-Q filing, but yesterday after the close followed up with a press release. Commentary included:

"Sales growth continued for the current quarter and while expanding internationally, we generated our first sales in Asia and Africa." Sealfon continued, "The FDA issued a new 510(k) clearance for our Integrated Catch-Up Freedom Syringe Driver System, the first ever fully integrated 510(k) cleared system by the FDA, confirming the science behind the performance of using the dedicated RMS system. It is also the only mechanical infusion system cleared for both subcutaneous drugs (SCIg) and intravenous (antibiotics), clearing the path for customers to invest in one system to meet all their needs."

Note that the information arbitrage we pointed out in our update was not mentioned in the release. The 10-Q stated that for the first time the Company anticipates the Warning Letter to be closed in the near future, a noticeable omission from the release.

Research

Tue, 14 Nov 2017 15:44:35 GMT

GB Repro Medsystems (OTCQX:REPR) ($0.66; $24.9M market cap ), a medical device company with more insider buying. We have continously highlighted the continued buying from insiders, specifically from director Joseph Manko from Horton Capital Management. Yesterday, Joseph Manko filed anotherForm 4 showing he added 130,000 shares to his already large stake at open market prices of $0.65 to $0.69.

We recently highlighted REPR’s strong Q3 2017results along with an update regarding the near closing of the FDA warning letter that has hampered the company the past two years.

You can see our full coverage on REPR here.

Research

Mon, 06 Nov 2017 15:25:21 GMT

Repro Medsystems (OTCQX:REPR) ($0.62; MC $23.4m ) reported Q3 2017 results (company recently changed its fiscal year end from February to December).

Sales of $3.8 million vs $3.2 million in the prior year
EPS of $0.01 vs $0.00

Information Arbitrage (InfoArb) from10-Q (no press release issued)

In its 10-Q filing the company discusses its ongoing saga with the FDA warning letter. The language in this 10-Q states for the first time that the Company anticipates the Warning Letter to be closed in the near future.

Shares hit a new 52-week high of $0.68 on the heels of the 10-Q filed mid-day Friday.

Research

Tue, 03 Oct 2017 14:33:07 GMT

GB REPR ($0.53) - several Form 4’s have been yesterday with respect to REPR. It seems the majority are for 5896 shares purchased at $0.53. We assume these are likely director compensation paid in shares, although typically the filing should state that. However, one of the filings from Fred Ma, the Company’s Chief Medical Officer showed he has acquired 28,302 at $0.53.

One of our bullish reasons for optimism in REPR has been the continuous open market support from Director Joseph Manko of Horton Capital Management, who owns a 15.6% stake in the Company.

Research

Mon, 18 Sep 2017 15:37:08 GMT

REPR ($0.55) - Joseph Manko of Horton Capital Management continues to add to his stake. A form 4 filed on Friday after the close shows that Mr. Manko added 146,000 shares for his various funds between 9/13/17 and 9/15/17. Mr Manko now holds roughly a 15.6% stake in REPR.

We recently highlighted that REPR put a major hurdle behind itself with the FDA 510(K) clearance for its Freedom60 Syringe pump. With this clearance in place, we believe it is likely that the FDA warning letter can be officially lifted in the near-term.

We have reached out to management to determine if our assumptions are accurate. If you are unfamiliar with the REPR story, please see our full research coverage here.

Research

Wed, 06 Sep 2017 16:47:15 GMT

GeoBargain REPR ($0.51) clears major hurdle with 510(k) clearance. For those unfamiliar with the REPR story, the stock has been stuck in limbo since the FDA issued a warning letter concerning the company’s Freedom60 Syringe and Freedom Edge Infusion Pumps on February 26, 2016. In our May 5, 2017 note, we stated that there were some positive signs in the 10-K that led us to believe that the Company may finally get past the FDA issue and be able to purely focus on increasing sales momentum.

In its latest 10-Q filing from August 4, 2017 the company stated the following:

“On April 25, 2017, RMS met with the FDA Center for Devices and Radiological Health (“CDRH”) Compliance team and the New York District Office to discuss the final resolution of Warning Letter closure. On May 23, 2017, the Compliance Office of CDRH issued a letter to RMS to acknowledge that RMS had successfully addressed all quality and regulatory issues cited in the Warning Letter. Prior to closing the Warning Letter, the FDA also needs to complete its review of our premarket submission (a pending 510(k)), which was accepted for review on May 17, 2017. On June 30, 2017, RMS received a written response regarding our pending 510(k) submission, and RMS is working with the Office for Device Evaluation of CDRH to address those questions in order receive the 510(k) clearance as expeditiously as possible.”

On September 4, 2017 via the FDA site, it seems REPR has received its 510(k) clearance.

With the 510(k) clearance in place, we believe it is likely that the FDA warning letter can be officially lifted in the near term.

Comments from management:

"RMS continues to provide the highest quality devices intended to improve patient quality of life. Our System delivers an accurate flow rate, and considers everything in the fluid path as an entire infusion system, making the patient the only variable. In doing so, it leads to increased compliance, healthier patients and therefore, lower overall costs. RMS will continue to develop new devices and technologies upon this platform and will be filing additional FDA 510(k) submissions for new applications in a continuing effort to help patients throughout the world."

You can see our full coverage on REPR here.

Research

Mon, 07 Aug 2017 15:08:37 GMT

REPR ($0.48) - On July 28, 2017, we highlighted the results for the four month period ending June 30, 2017 due to the change in its fiscal year. You can see the results here. On Friday, REPR filed its accompanying 10-Q. While reading the 10-Q we came across interesting verbiage regarding the “Warning Letter” issue.

“On April 25, 2017, RMS met with the FDA Center for Devices and Radiological Health (“CDRH”) Compliance team and the New York District Office to discuss the final resolution of Warning Letter closure. On May 23, 2017, the Compliance Office of CDRH issued a letter to RMS to acknowledge that RMS had successfully addressed all quality and regulatory issues cited in the Warning Letter. Prior to closing the Warning Letter, the FDA also needs to complete its review of our premarket submission (a pending 510(k)), which was accepted for review on May 17, 2017. On June 30, 2017, RMS received a written response regarding our pending 510(k) submission, and RMS is working with the Office for Device Evaluation of CDRH to address those questions in order receive the 510(k) clearance as expeditiously as possible.”

This is the first instance we’ve seen REPR acknowledge that they have successfully met all the quality and regulatory issues in the warning letter. It seems they are now 1 step away from officially putting the FDA warning letter behind them. Shares dipped on some volume for a moment on Friday, but we were unable to ascertain any obvious news that could have caused the sell off. We will continue to watch closely. For full background on the REPR story, please go to the company’s research page.

Research

Fri, 28 Jul 2017 17:36:51 GMT

GB $REPR ($0.47) announced results for the four month period ending June 30, 2017 due to a change in fiscal year. All results are compared against the same period of time in the prior year:

Sales of $5.3 million vs $4.1 million in the prior year (four months)
EPS of $0.01 vs $0.00 in the prior year (four months)
Sales of $3.8 million vs $2.9 million (3 month period ending May)
EPS of $0.01 vs $0.01 in the prior year (3 month period ending May)

Quotes from management regarding sales growth:

The increase is driven principally by organic growth with our existing customers both domestically and internationally. Part of the increase was the result of the backorders of $0.4 million from the period ended February 28, 2017, which were filled during the four months ended June 30, 2017. Excluding these backorders the net sales increase was 21.6% for the four month period ending June 30. The launch of a new drug generated increased needle sales as customers built inventory, two large pump orders were accelerated forward into this period and last year included a large return of product related to the market withdrawal.

It is unclear to us if the big orders will continue in the future. However, with the new relationship with Shire and the move to a new larger manufacturing facility we believe sales momentum is moving in the right direction.

On the FDA warning letter:

We continue to work with the FDA to resolve our regulatory matters. Andy Sealfon, RMS Chief Executive Officer commented, “The FDA renewed our Certificate to Foreign Government which is used to communicate to foreign governments that the FDA has certified that RMS meets good manufacturing practices and quality system regulations.”

Progress and outlook:

“We delivered sales growth both domestically and internationally, ramped up production to keep pace with demand and found ways to lower costs. We received registrations in new countries, launched our new flow controller in Europe and started several clinical trials with drug companies.”

We have launched a new marketing campaign, redesigned our packaging and entered the social media world to help extend our brand awareness. We plan to continue to focus on global sales growth, cost control and new product development.”

On July 18, 2017 we stated we came across an interesting Information arbitrage opportunity (InfoArb) in a recent Princeton Research Inc. podcast featuring the COO of REPR, Eric Bower. Please read the full transcript. Our three major takeaways from the video that we do not think have been widely recognized by the market include:

The Company announced that it inked an agreement with $SHPG and it can now start delivering Shire approved drugs. Shire is one of the largest biotechnology companies ($47 Billion Market Cap) focused on serving people with rare diseases.
Management stated the Company was having a great quarter (results reflected above)
Management discussed that it was actively looking for new facility.

Today’s release still does not mention the relationship with $SHPG or the new facility search, so there is still InfoArb opportunity presented. At the time of this note, we only see the results via 8-k, no press release has been issued. The fact that the FDA renewed its certificate for foreign government is a good sign to us that there is a high probability that the FDA warning letter will be lifted.

Interviews

Thu, 20 Jul 2017 18:38:07 GMT

Please read the entire transcript in its entirety (Note: Information Arbitrage is highlighted in red!)

Interviewer:

Oh, here is Eric. Welcome Eric!

Eric Bower:

Eric Bower.

Interviewer:

Oh man it never stops so how are you…how are you guys doing?

Eric Bower:

We're doing great at RMS! We're busy doing a lot of different things and you know, moving forward in an exciting path here. It’s been a busy summer, this is our trade show time so we’ve running around to a number of different trade shows both in Europe and in the US and we also has a we just recently had all of our customers in Europe together. We all pulled them into a meeting in Budapest, so the first time I ever went to Budapest (Hungary) but we had all of our European customers in and we shared with them our vision for the business and where we’re going and all the improvements and they were really excited about our future and our relationship with them, so we’re having a great first quarter, we’ve exceeded all of our financial numbers for the first quarter, so we’re doing really good . We have a lot of exciting things coming along in terms of new products, that I can’t really share openly yet because it’s highly confidential, but we’re investing in new products and I think we have some great things that we’ll be launching in the near future and we have new packaging and new marketing and all kinds of exciting things going on.

Interviewer:

You could share your secrets with us, we only have a few Russians listening so… You’re good to go.

Eric Bower:

Yeah, well as long as Donald Trump is not listening.

Interviewer:

I’ve got a question. You know, a few months back you had mentioned that you guys were searching for a new hub, a manufacturing hub. You still looking?

Eric Bower:

Yes, we are. In fact, we’re looking for a new building we’ve...

Interviewer:

Aha.

Eric Bower:

The business is growing. The building that we’ve been is our current building for twenty years and we’ve just flat-out outgrown this building, so we need to find a new building and I actually have a meeting this afternoon with a local contractor who’s going to show us some designs for a building that they’re building, which is in in the local area , we’re not going to...

Interviewer:

Oh ok.

Eric Bower:

We’re not going to disrupt our current workforce and anything at this point, so we are looking for a building in the area and I think we found a location so we have a meeting this afternoon to discuss the particulars and see whether or not this opportunity may pan out for us.

Interviewer:

Well that would be great!

Eric Bower:

Yeah, we’re very excited about it because this particular contractor is willing to build to suit, so he has a location and he would actually build a building to our design and it’s always better when you’re in the type of business we’re in, especially where our products are made in clean rooms and there’s a very particular flow that has to take place and we are also a warehouse hub for all of our US customers, so it’s best to actually design a building that kind of fits your needs.

Interviewer:

Sure.

Eric Bower:

As opposed to go into an existing facility and try to renovate it and force fit yourself into it, so we’re hoping this will work out with this particular builder and maybe we can come to actually design a building that would be ideal for us.

Interviewer:

And I think what’s neat there and you know I know you, and you’ve mentioned that you were looking possibly in Jersey or other places like that. I mean, boy, if you could keep it local, you wouldn’t disrupt any of the employees, which I’m sure is a primary goal of yours.

Eric Bower:

Yeah, it’s very important to maintain a stable workforce in any company today. Our turnover is really relatively low, we just did a study of company similar to ours and the turnover in those companies is been in a fifteen percent range. So, can you imagine, you know, fifteen percent of your employees turning over every single year and our employee base has been running a turnover about four percent . So, we’re substantially lower than many of the companies that are in our similar industry, are in this look, in this area, but turnover is really expensive and because of the recruiting cost, the constant retraining of people, so you want to maintain a stable workforce as much as you can for as long as you can and we’ve been able to keep our turnover really relatively low, for an organization our size and in this particular area.

Interviewer:

That’s great!

Eric Bower:

We’re pretty happy about that.

Interviewer:

Yeah that’s great! I think our newest employee came to us about fifteen years ago I mean, we’ve...

Eric Bower:

That’s good!

Interviewer:

We’ve been very blessed, there’s no doubt about it. So, tell us...

Eric Bower:

Turnovers are very expensive...

Interviewer:

Oh yeah, you bet it is. Well tell us about…

Eric Bower:

We put a lot of time and effort into... in fact we have a set of goals for our company and one of those goals is really driving improvements in our culture and culture is one of the most difficult things to change in a company. It’s very easy to change procedures or to change products, but once a company has an established culture, it’s a very difficult thing to change culture and to move it in a direction that you want it to go, so we’re sort of refined our goals for our culture. When I used to talk about culture, I talk about things like communications and team, teamwork and things that go into creating an environment where you can minimize the turnover where people really like to work there, they really want to stay there and really want to work there. So we have a very concerted effort as an executive team to build a culture here, where people really get up and really enjoy coming to work every day. I tell people who work for me: “if you don’t like what you are doing, come to me, let’s find something that you know”. Especially for that we really focus on trying to hire exceptional people, so you don’t want these people to leave and generally we try to move people around, give them challenging assignments, we put them on teams and have them solving problems as teams. So, you build a culture that is motivating the people, that they come in and they like the people that they’re working with and they like the communications from management, they’re aware of everything that is going on in the company and where we’re going, what the vision of the future looks like. You do this and all of this, you know, takes a little effort on part of the executive team to take the time to have the communications and everything that you need to go on. But overall, it lowers your costs, you have more productive people, you have less turnover in the company, so it’s well worth, you know, building and focusing on the culture within the business to move it forward.

Interviewer:

Wow! It’s amazing, you know, you’ve hit everything right on the head and sure, retention is everything! There’s no doubt about it. What’s the reaction been around, you talk about going to the shows. What’s the reaction to RMS medical?

Eric Bower:

The reaction is good! Very good! Our customers continue to be very excited about our products. Our products are the highest quality products available in the marketplace, so you know, we sell medical infusion devices, the pumps and the tubing and the needle sets and our devices are absolutely the best on the market and our customers continue to come to come back to us and to tell us that. For example, our needles are the sharpest needles, they give you the best high-quality flow of the drugs and people love them. One of the shows that we were just at was IDF, which is an auto immune deficiency foundation and is more of a patient focused show. It’s one of the few shows where you go to and you actually have patients, you have children who come who are using our systems, you have adults who are using them and they come to the show to learn more about the infusion because they are on these drugs for their entire life and they want to know what are the best products out there, how to solve problems, how to troubleshoot and it’s really exciting to actually talk to the patients themselves. It’s so strange to have a ten-year-old child walk up to you and start talking to you in medical terms, talking about how the infusion works, what kind of needles they use, the length of their needles and you say: “wow is this a is this really a ten-year-old child?”. But their life depends on their drugs and they infuse either once a day, or once a week, or twice a month and their life has changed by using our products, so they just love it, they literally come to our booth and say: “don’t change single thing, I love your products!”. They actually really substantially changed my life. What’s key about that, is our products are used for home infusion, prior to our products, a lot of patients had to go to clinics, hospitals, or doctors’ offices to get their infusion of their drugs. By virtue of the fact that they can use our mechanical device, which doesn’t have any battery power requirements, you don’t need to be plugged into a wall, you can be sitting at home watching TV or you can put it in its little carry pouch and you can go out and walk the dog while you’re infusing. And many people do this, they put their needles in and they start their infusion and then they go out and walk the dog and by the time they’re done, their infusion is done and they have the freedom to do whatever they want to do. It really changes their lives. When you go to a show like IDF and you talk to the patients, it really hits home, it really makes you feel fantastic to be able to have this much of an impact on people’s lives. And to have them come up to you and say: “Wow! You know, you’ve changed my son or my daughter’s life with these products!”. So, we’re very excited about this, our customers, our patients, everybody continues to rave about our products. No other competitor out there has anything like what we do and we’re very excited and continue to get all the positive feedback from the trade shows.

Interviewer:

Yeah, you see a young person walking up to you like that and you think it’s Doogie Howser or something, right?

Eric Bower:

Yeah, it’s amazing! They spend a lot of time focused on their care and what they do and they really pay attention to their nurses and their doctors and they learn a lot! It’s amazing how quickly they learn as children because they’re doing this so frequently, that...they have to understand and they start off with the nurses inserting their needles their infusion needles and then their parents usually end up doing and then, very shortly after that, they just do it themselves and they don’t think twice about it, they just insert the needle, they put they put their drug in their pump and they turn it on and then they’re free to do whatever they want to do.

Michael:

You’re doing a lot in foreign market. Can you elaborate on that?

Eric Bower:

Oh yes, we’re expanding. It’s actually a misnomer to think about us as a US company, even though the majority of our sales are currently in the US, we are expanding rapidly throughout Europe right now and our chief medical officer just got back from Asia, where he made a tour of a whole number of countries in Asia and we have just taken our first order from Vietnam and gotten registration in a number of Asian countries , so before we can actually sell our products in countries, we have to be registered with their with governments or their version of the FDA. So, we are actively engaged with a number of governments to push through our registrations in those countries and we have clinical trials going on in many locations throughout Asia and Europe and also continuing to do those in the US, as well. We just had one of the major drug companies, Shire, came in and wanted to work with us on expanding their sale of a new drug and they did a quality audit of us and literally I think it was like just a couple weeks ago, they actually announced to their entire organization that we are an approved supplier to Shire. So, Shire is going to be a great company to work with and we’re going to help them expand the use of their drugs throughout the world.

Interviewer:

Wow! That’s a huge announcement!

Eric Bower:

And we are working closely with the drug companies as well.

Interviewer:

That’s a great announcement! Well, Michael?

Michael:

What would a user of the product acquire through the utilization? How would they be improving themselves?

Eric Bower:

How would a user, you mean in terms of the drugs or our device?

Michael:

Yeah.

Eric Bower:

Well, our patients right now, this is one of the other things, is the majority of our patients are immune deficient patients. They have compromised immune systems; their bodies aren’t creating enough immunoglobulins to protect them from getting sick on a regular basis. So basically, their immune systems aren’t capable of fighting off even the common cold, I mean a lot of them have to avoid contact with their friends and a lot of them can’t leave their homes, unless they get their immunoglobulin drugs. The drugs companies, whether it’s Shire, CSL, Akta Pharma, a number of other companies, they’re all creating these immunoglobulin drugs, which are... I look at them and I think “these are like miracle drugs”. Because they essentially enhance the immune system of these patients, who previously could not go out, the kids couldn’t go out and play with their friends, they can’t go to school for fear that they would actually catch a cold and get pneumonia. These immunoglobulin drugs actually boost their immune systems, so that they can fight off all of these common colds and viruses and things. So, the drugs are expanding and becoming more and more available on the marketplace and all of these drugs need a delivery device. In the past, people would put them in through an IV or through a PICC line or something like that, but when you do that, you get a huge surge within the body where the immune system in body jumps up really quickly, but then it drops off fairly quickly as well. They talk about these as the trough levels, the levels of the immunoglobulins within their systems, so basically, when you stick with some of the traditional systems of delivery like IV delivery, the trough levels jump way up and then they come way down and the patients have a hard time maintaining a steady level of this drug. Well, using a subcutaneous delivery, which was what we do, a subcutaneous is where the drug is delivered just below the surface of the skin into the subcutaneous tissue and when you do that, you’re not putting it directly into the bloodstream. So, you’re basically creating a deposit of the drug, within the patient’s body, typically like in the abdomen area or in the thighs, to create a deposit of this drug in the patient’s body and the body absorbs it slowly, over time, rather than putting in directly into the bloodstream. When you do this, what all the studies show is that the trough levels remain constant and over a much longer period of time, so that the patient’s protection is not going up and down and they maintain a steady protection over a longer period of time. They’re healthier. They become healthier patients over a longer period of time, so subcutaneous delivery is the way that these drugs are being delivered going forward and we’re learning all of this through these primary immune deficient patients that subcutaneous is a better method of delivering drugs. So now what we’re seeing is doctors are saying: “hey, if this is true for this drug, why can’t I do the same thing with pain medications? Why can’t I do the same thing with antibiotics and have the same positive effect?” So, they’re looking at a number of different indications and a number of different drugs now, so the use of subcutaneous delivery, which is what we do, with our pumps and our needles and our tubing, is becoming a growing market place because it’s a more effective way of delivering the drugs to the patients. It actually makes them healthier and so, the patients get a huge benefit from us and not only that, they don’t have to go to a clinic or a hospital to get this. They could do this at home. So, our business is not only expanding within the primary area that we target, but it’s expanding into a number of different indications, where people are now experimenting with other drugs and delivering them through subcutaneous, so we’re pretty excited the fact that not only is our primary market growing, but the secondary market for all these other drugs is growing as well and many drug companies are developing new drugs, specifically for subcutaneous delivery. Finding that they can be far more effective in some of the patients’ problems by doing this, so our future is really bright. It’s an ever-growing business, not only from a drug company level, but patient levels, indication levels on a global basis, is growing everywhere and the whole market is moving to the home infusion. So, if people want to do their infusions at home, they don’t want to spend their entire day sitting in a hospital doing, their infusion when they can sit at home and do it in an hour at home.

Interviewer:

Sure, yeah.

Eric Bower:

So, it’s really convenient for the patients.

Interviewer:

So how, Eric, how large a market would you say Vietnam is going to turn into for you guys?

Eric Bower:

You know, if I had a crystal ball I probably wouldn’t be working. But we are very optimistic because whether you realize it or not, a market like Vietnam, if people… it’s funny, I don’t want to give away my age, but I remember you know the Vietnam that was the wartime Vietnam.

Interviewer:

Oh, yeah, so do I.

Eric Bower:

And it is not that anymore. There is a wealthy class of people there now because a lot of manufacturing has moved there, there’s a huge middle class now, it’s very much a modern-day country in many respects, so they want to have modern day technology, modern day medical drugs, so the drug companies are launching that. We basically went into Vietnam for example, following a drug company. So, the drug company said: “we need your help, we can’t launch our drug here without you guys”. So, we followed them in, we got our registration, so as the drug continues to grow and the doctors continue to prescribe it, then basically we ride on the coattails of the drugs into these countries. We believe that market will continue to grow for us, it’s just starting out and there’s really no telling on how big it will get . It all has to do with the patient population and the number of patients that are being diagnosed in this particular case with primary immune deficiency, which tends to be somewhere between five and seven percent of the population, so it can be quite substantial going forward .

Interviewer:

Wow!

Michael:

How long does it take to put the device on for someone... for a patient at home?

Eric Bower:

Basically, you have to start by washing your hands and then the drugs are delivered in a glass vial and you transfer the drug from the vial into a syringe. Then basically, you just connect the tubing in the needles, you prime your tubing and then you just insert the needle. So, we’re talking just a matter of minutes, I mean once you’re trained on doing this, it’s just a matter of minutes. You insert the needles and you put a Tegaderm over them to hold them on and it’s just one switch on the pump, you turn the switch on and it starts the infusion process. The infusion process itself, typically, takes about an hour or maybe a little bit longer because you’re infusing them a fairly large quantity of drug at a very slow rate because you want to put it in slowly so that you are not hurting the tissue of the skin. So, it takes about an hour, an hour and a half sometimes for an infusion to be complete, but the actual setup is only minutes. What the patients love is that they could do it at their convenience. When they’re finally sitting down at night and they’re going to watch a TV show, they can basically do their set up, insert their needles and start their infusion. They can watch their TV show and by the time the TV show is done, the infusion is over with. So, it’s huge convenience factor and that’s one of the things we heard over and over again from patients, is they just love being able to do this at their own convenience. The funny thing is people say: “well why is that a big deal?”. It’s a big deal because the more you can make it convenient for the patient, the more compliant the patient is. That means that they’re taking their drugs at the right time, on the right schedule and when you have compliant patients, you have healthier patients because their trough levels remain constant or there they are just healthier, they’re less likely to catch a cold, get pneumonia or to get sick, so compliant patients lead to healthier patients, which lead to lower overall healthcare cost.

Interviewer:

Wow! You got a great story here, Eric!

Eric Bower:

This is what is all about.

Interviewer:

What’s your website at RMS medical?

Eric Bower:

It’s rmsmedicalproducts.com!

Interviewer:

Alright! And Michael, how’s that stock look?

Michael:

Fantastic. I mean, really looks like it’s poised to go, it’s the cheapest stock on the board.

Interviewer:

Alright!

Michael:

Yeah! REPR is the symbol

Interviewer:

Alright, guys! Well, thank you much Eric Bower (president COO of RMS medical), thank you very much Tim Connolly (our oil expert as always) and of course, Mike King and Charles Moskowitz (who bring you money input). Don’t forget that newsletter, every Sunday it comes out and boy, I’ll tell you talk about...

Research

Thu, 20 Jul 2017 04:00:00 GMT

On July 18, 2017, via premium tweet, we stated that it was unclear as to why shares of Repro Med Sys Inc (OTCQX:REPR) were down on somewhat heavy volume during the trading session.

However, we did come across an interesting Information Arbitrage opportunity in a recent Princeton Research Inc. podcast featuring the COO of REPR, Eric Bower. Here is the full transcript . Our three major Information Arbitrage takeaways from the video that we do not think have been widely recognized by the market include: 1. The Company announced that it inked an agreement with $SHPG and it can now start delivering Shire approved drugs. Shire is one of the largest biotechnology companies ($47 Billion Market Cap) focused on serving people with rare diseases:

“We just had one of the major drug companies, Shire, came in and wanted to work with us on expanding their sale of a new drug and they did a quality audit of us and literally I think it was like just a couple weeks ago, they actually announced to their entire organization that we are an approved supplier to Shire. So, Shire is going to be a great company to work with and we’re going to help them expand the use of their drugs throughout the world.”

2. Management stated that the Company was having a great quarter:

“so we’re having a great first quarter, we’ve exceeded all of our financial numbers for the first quarter, so we’re doing really good. We have a lot of exciting things coming along in terms of new products, that I can’t really share openly yet because it’s highly confidential, but we’re investing in new products and I think we have some great things that we’ll be launching in the near future and we have new packaging and new marketing and all kinds of exciting things going on.”

3. Management stated they are looking to move into a new facility, which we think could ultimately lead to the end of the FDA warning letter concerns that have been a cloud over the Company for the past year and half. The Company has been under a cloud since the FDA issued a warning letter concerning the company’s Freedom60 Syringe and Freedom Edge Infusion Pumps on February 26, 2016. You can see our full coverage on REPR here, including all of the events surrounding the FDA warning letter. There is still obvious risk in the REPR story, but we thought you might find these new developments useful.

Please see the video read the full transcript.

Research

Tue, 20 Jun 2017 15:41:43 GMT

REPR ($0.46) hit a new 3-month high. Shares have slowly been inching up since we discussed the slight InfoArb opportunity presented in the Company’s 10-k filing on May 5, 2017. For those unfamiliar with the REPR story, the stock has been stuck in limbo since the FDA issued a warning letter concerning the company’s Freedom60 Syringe and Freedom Edge Infusion Pumps on February 26, 2016. In our May 5, 2017 note, we stated that there were some positive signs in the 10-K that led us to believe that the Company may finally get past the FDA issue and be able to purely focus on increasing sales momentum. Specifically, we found it interesting that management issued some commentary, suggesting that sales will be grow over the next 18 months. As far as we can recall, management has never in the past issued inferences to guidance. Unfortunately, since the FDA letter, the CEO has been somewhat unreachable, so we have been unable to secure an interview with him. We continue to believe that, barring an FDA setback, REPR has meaningful upside.

Research

Fri, 05 May 2017 18:45:13 GMT

REPR ($0.41) has been basically stuck in limbo since the FDA issued a warning letter concerning the company’s Freedom60 Syringe and Freedom Edge Infusion Pumps on February 26, 2016. We have been covering the progress as the Company works with the FDA to resolve the issue. You can see our full coverage on the story here.

Today, REPR filed its 10k for fiscal 2017. In the K, the Company was more specific in its growth outlook and more importantly was more clear on its progress with closing the FDA warning letter issue.

First the results:

Q4 sales of $2.96 million vs $3.3 million in the prior year.
Q4 non-GAAP break even vs non GAAP EPS of $0.01

Takeaways from the 10K:

Sales would have been flat for the year and quarter if not for the timing of order shipments. More importantly, the company is forecasting increase sales for the next 12 to 18 months.

“Net sales for the year ended February 28, 2017 were nearly even with last year. Due to larger orders placed at the end of the year and timing of available product, we were unable to ship ordered product until after February 28, 2017, resulting in nearly $0.4 million in lower revenue for the period due to timing. During fiscal 2017, we added to our customer base internationally and expect to see an increase in sales over the next twelve to eighteen months as the customer penetrates the market.”

On the FDA warning letter:

“We continue to have correspondence and dialog with the agency in order to address all of FDA’s concerns cited in the Warning Letter and the FDA FORM 483s and to close the Warning Letter in the near future.”

This is the first instance in any filings where REPR talks about the FDA issue being closed in the near future.

Prior verbiage on FDA warning letter:

“We continue to have high professional fees related to our litigation and regulatory efforts and, although we are making every effort to resolve the litigation and close out our FDA Warning Letter, we cannot predict the timing of either of these efforts, nor can we predict the outcome.”

We view these developments as positive signs that the Company may finally get past the FDA issue and focus purely on increasing sales momentum.

Research

Mon, 24 Apr 2017 14:26:09 GMT

REPR ($0.41) announced the FDA has renewed the Company’s Certificate to Foreign Government (CFG). A CFG is issued for legally marketed devices in the U.S. that are in compliance with the requirements of the Federal Food, Drug, and Cosmetic Act.

“The renewal of this CFG confirms RMS devices have been cleared for sale in the U.S. and are in compliance with the requirements of the FFDCA. The CFG can be presented to regulators in foreign markets as part of the medical device registration process. Foreign governments often seek official assurance that products exported to their countries can be marketed in the U.S. and meet specific U.S. regulations, for example, current Good Manufacturing Practice ("cGMP") regulations and Quality System Regulations ("QSR").

"The FDA renewal of our CFG is confirmation of our product clearances and that RMS meets specific U.S. regulations including cGMPs and QSRs," said Eric Bauer, RMS Chief Operating Officer. "Our CFG allows RMS to continue our international expansion efforts and maintain our global leadership position. We are pleased the FDA recognizes the RMS Quality System meets U.S. regulations and that the FDA continues to support the sale of our products in the U.S., as well as other countries."

The Company has been under a cloud since the FDA issued a warning letter concerning the company’s Freedom60 Syringe and Freedom Edge Infusion Pumps on February 26, 2016. We are planning to contact the Company and/or the FDA to see if this clears REPR of the warning letter issues. Regardless, this is very good news and a step in the right direction. However, it is unclear if the Company can market its products for all the indications, as it had been able to in the past, nor is it clear if the approved indications are narrower in breadth.

Comments & Business Outlook

Mon, 17 Apr 2017 14:55:57 GMT

REPR ($0.42) established a new medical advisory council.

“The members of this council are highly respected medical professionals and key opinion leaders in the immunology, allergy and immunodeficiency medical arena. The role of this council will be to advise the RMS Leadership Team in the area of research, product development, continual improvements, clinical studies and global expansion efforts. The council will also provide post marketing medical education to promote the safety and effectiveness of RMS' products and enhance the communications and networks between RMS, medical specialty pharmacy and nursing societies.”

REPR is the leading manufacturer of medical products used for home infusions and suctioning.

Research

Mon, 30 Jan 2017 16:01:17 GMT

REPR ($0.44) - Another Form 4 from Horton Capital Management was filed on Friday, after hours. Joseph Manko of Horton Capital Management filed another Form 4 showing he added 15,000 shares to his position in REPR. Horton now owns 5.76 million shares.

Research

Wed, 11 Jan 2017 16:16:05 GMT

REPR ($0.42) - Another sign of confidence by Horton Capital Management. Based on a Form 4 filed yesterday after hours, Horton Capital added more shares of REPR at open market prices (22,500 shares). This comes just days after the Company filed its 10-Q containing the latest verbiage regarding its FDA warning letter which we discussed in our January 6 email. We stated we would continue to track filings to see if Horton Capital would continue to purchase shares and this latest Form 4 gives us confidence that the Company is working hard to cooperate with the FDA to resolve issues regarding the warning letter from Feb, as well as with site inspection recommendations.

Research

Fri, 06 Jan 2017 16:27:20 GMT

REPR ($0.49) filed its 10-Q after hours yesterday in conjunction with last week’s (Q3 2017) earnings announcement. We noticed a change in the verbiage regarding the FDA warning letter update:

“The Company underwent a site re-inspection which concluded on December 16, 2016 with the issuance of a Form 483 (Inspectional Observations) to which the Company plans to respond within the fifteen business days deadline. There is no deadline for a reply by the FDA, and the Company’s manufacturing and distribution continue without interruption

Although the Company is attempting to meet all of the FDA requirements, we cannot be certain that our actions will be deemed satisfactory by the FDA and this could have a material adverse effect on the Company’s business, results of operations, financial condition and cash flows.”

We encourage you to click the above link for more color on the FDA Form 483, where it appears they give very clear instructions on steps to rectify the facility issues. We will monitor the FDA site regarding the site re-inspection.

This is separate from the Class designation issue that we had discussed in prior research notes.

In its Q3 2017 press release from December 27, 2016 the company stated:

"We continue to work closely with the FDA in order to resolve the FDA Warning Letter. We have been and will continue to be proactive in working with the agency in order to resolve all issues that have been or may be raised by the agency as soon as possible."

We will continue to track filings, specifically to see if Horton Capital Management continues to purchase shares. For our complete coverage on REPR, please go here.

Research

Thu, 05 Jan 2017 16:30:36 GMT

REPR ($0.42) - After a nearly two month dry period, Horton Capital Management has resumed its accumulation of REPR. In a form 4 filed yesterday, it shows that Horton Capital purchased an additional 320,000 shares at $0.47 average. See our full coverage on REPR here.

Research

Wed, 28 Dec 2016 16:09:51 GMT

REPR ($0.40) - Reported Q3 2017 results:

Sales of $3.19 vs $3.14 in the prior year
Adjusted net income of $281,197 vs $352,694

Quotes from management:

Andy Sealfon, RMS CEO and President, commented, "We are pleased to see some of our efforts internationally starting to come through with orders." Addressing the FDA Warning Letter, Mr. Sealfon noted: "We continue to work closely with the FDA in order to resolve the FDA Warning Letter. We have been and will continue to be proactive in working with the agency in order to resolve all issues that have been or may be raised by the agency as soon as possible.

In the upcoming months, RMS plans to be participating in a number of distributor sales meetings, giving the Company the opportunity to speak with its customers and align corporate goals for 2017. In addition, RMS launched its redesigned website enhanced with search engine optimization and other analytics. As patients, providers, and distributors look to the web for better resources regarding product information, best practices and continuous improvement, we plan to make developments continuously to the site to further enhance the visitor experience and interaction with the RMS brand.”

Based on the above, it is evident that Company is taking the necessary steps to bring closure to the FDA Warning Letter concerns. While we hoped this issue would have been resolved by now, we are still hopeful that the company will exit this situation in a better position to grow. We can deduce by the fact that the FDA has not shut down the company that they are likely working with them. See our entire coverage of REPR here, which includes a discussion of the warning letter it received from the FDA in March 2016.

Research

Wed, 12 Oct 2016 14:57:02 GMT

REPR ($0.43) - Director Joseph Manko of Horton Capital Management continues his buying of shares in the open market. A form 4 filed yesterday after the close shows Manko added another 32,500 at $0.43, bringing his total stake to 5.2 million shares. See our complete coverage on Manko’s continuous open market purchases and our research regarding the Company’s FDA warning letter here.

Research

Tue, 04 Oct 2016 15:40:19 GMT

REPR ($0.42) - Similar to ESCC, the REPR form 4’s keep rolling in. Director Joseph Manko continues his buying of REPR shares in the open market. In a form 4 filed yesterday, it shows, while he was granted 1746 shares for his role as a director, he also purchased another 136,000 shares at an average price of $0.44. You can see our full coverage of the recent buying spree from Joseph Manko here.

Research

Mon, 26 Sep 2016 15:57:24 GMT

Will Look To Add to GeoBargain REPR ($0.39) If Shares Fall On Q2 2017 Results. The company announced second quarter 2017 results:

Sales of $3.15 vs $3.16 in the prior year period
Non-GAAP net income of $117,197 vs $483,352 in the prior year period

Quotes from management on business outlook:

Our strong organic growth both domestically and internationally in the quarter as well as new customer wins, which we expect will continue to add to our results going forward, were masked by the non-recurring contribution from a large clinical trial last year.

Over the past year, the Company has invested in its sales and management teams, which positions us for anticipated growth over the next several quarters. Furthermore, as part of our sales and marketing initiatives, we recently attended the IgNS 2016 5th National Conference in Miami, Florida and received great feedback from nurse practitioners and healthcare professionals who use our system with their patients," commented Andy Sealfon, CEO of RMS.

Quotes from management regarding FDA warning letter:

“RMS is engaged in dialogue towards a resolution of the FDA Warning Letter. The Company has established a positive collaboration with the FDA and looks forward to a favorable and swift resolution. We are encouraged by the results of an ISO audit made in April by international standards leader BSI, which confirmed excellent compliance in RMS's quality management systems, and required minimal follow-up prior to next year's audit. RMS devices are both safe and effective for use by patients worldwide, and remain available in all markets."

It’s great that the company has been able to maintain the $3 million revenue level along with profitability during this FDA inspection process which we believe has likely been impacting sales in the short term. Management's comments about the resolution of the FDA warning letter are encouraging. We assume that their confidence level of a resolution is high or there would probably have been an absence of comments. We will possibly look to add to shares on weakness.

See our past coverage on the whole FDA saga as well as continued stock purchases by Director Joseph Manko of Horton Capital Management here.

Research

Wed, 17 Aug 2016 04:00:00 GMT

REPR ($0.47) - The insider buying has continued at REPR. Our last update on July 12, 2016 covered how Joseph Manko of Horton Capital Management added 185,000 shares in early July. Since then, he has filed a number of form 4 filings disclosing another 186,000 shares purchased in the open market, bringing his total to 5,074,083 shares.

See our recent write up on why we believe REPR can more than double from its current trading levels.

Research

Tue, 12 Jul 2016 15:46:19 GMT

REPR ($0.47) - Yet anotherForm 4 filed from Joseph Manko of Horton Capital Management shows he added 10,000 shares at open market prices.

This marks the third filing thus far in July showing Mr. Manko adding to his position. He has now added 185,000 shares in July, bringing his stake to 4.8 million shares.

See our recent in-depth spotlight research note, “REPR: Risk with Greater Potential Reward” where we highlight Manko’s continuous buying as an encouraging sign considering the recent FDA warning letter REPR received.

Research

Fri, 08 Jul 2016 18:05:40 GMT

REPR ($0.47) - Director, Joseph Manko Jr of Horton Capital Management continues to add to his position. Via another Form 4 filed yesterday after hours, Manko purchased 30,000 more shares at $0.44, bringing his stake to 4.87 million shares.

It was just two days ago when we highlighted REPR as a stock we believe can more than double in the near future. See our recent research note, “REPR: Risk with Greater Potential Reward” where we highlight Manko’s continuous buying as an encouraging sign considering the recent FDA warning letter REPR received.

Besides the continued institutional support from Horton Capital, the interest from new customers such as the Military could be a major catalyst to propel shares higher.

Research

Wed, 06 Jul 2016 13:25:02 GMT

REPR: Risk with greater potential reward

We believe that REPR can more than double from its recent trading price, but there are risks. The Company has been under a cloud since the FDA issued a warning letter concerning the company’s Freedom 60 Syringe and Freedom Edge Infusion Pumps on February 26, 2016. This product suite delivers medication to patients based on a system that does not require batteries or electricity and uses needles that have the advantage of being administered subcutaneously. REPR did not announce receipt of the FDA letter until March 9, 2016, when its shares reacted by plunging 25% from around $0.60 to $0.375, eventually hitting a low of $0.28 in ensuing trading days. Shares are now sitting in the mid-$0.40 range.

We first highlighted REPR at $0.37 in an article we published on October 7, 2014. Before the FDA snafu the thesis was playing out rather nicely. Shares ended 2015 hitting a new 52 high of $0.59.

Since April 6, 2016 we have been updating our premium members on this evolving story.

The additional purchase of stock by an institutional investor adds a degree of confidence.
A lax in reporting protocol to the FDA that appeared to play a big role in the issuance of the FDA letter is being addressed.
We believe that the company is the leader in its field and appears to have much safer and more effective products than its competitors.
It looks like its most relevant competitor has an inferior product and has not received a warning letter.
The company is still receiving indications of interest from new customers, such as the Military, who are aware of the FDA warning letter.

Despite the market’s adverse reaction, on March 9, 2016 the company’s newly appointed Chief Medical Officer expressed confidence stating,

“While we anticipate one item taking a bit longer to resolve, the others are merely an exercise in better communicating our thorough processes and premium safety standards to the FDA. As always, we remain committed to uncompromised safety and quality for all of our products.”

Given the sensitivity of the Company’s discussions with the FDA, there have been no status updates on the progress management is making to have the warning letter lifted. We have begun to share management’s confidence though that the matters detailed in the FDA’s letter may be favorably resolved.

Bullish Factor Can’t Be Ignored - Follow the Money Trail

It’s always great to see institutional support come into a microcap stock you own. That happened to REPR when on August 18, 2014 Activist investor, Joseph Manko, Jr., the Senior Principal in Horton Capital Management LLC, disclosed his ownership of 2.9 million shares of REPR and has consistently added to his position. More importantly, in April 2016 he added 85,500 shares to his position post the FDA warning letter at prices between $0.31 and $0.33. Now, just yesterday, on July 5, 2016, he disclosed that he added another 145 thousand shares between $0.41 and $0.45. This is very relevant since Mr. Manko was appointed to the Board of Directors in May 2016. Mr. Manko now owns 4.8 million shares. It is encouraging to see ongoing support from an activist investor who is now a Board Member.

Fiscal Q1 2017 (May 2016) results reflect impact of FDA warning letter

The company reported fiscal Q1 2016 (May 31) results on June 27, 2016. At first blush, revenues were a little lighter than we would have liked having sequentially declined $800,000 or 22% from fiscal Q4 2016 (February). While Q1 is seasonally REPR’s weakest quarter (22% of annual revenue in recent years) and Q4 the strongest (over 30% of annual revenue), we believe some of the sequential decline in revenue can be attributed to the impact of uncertainty caused by the FDA warning letter. We have little doubt that both existing and, especially, potential new customers were at least to some extent dissuaded from making substantial commitments to REPR’s products until the warning letter is lifted. If anything, we are encouraged that the Company was able to generate $3.0 million revenue despite the distraction and headwinds caused by the situation with the FDA. It appears that REPR has reached a new level quarterly revenue run-rate and is in a position to continue to build on its impressive run of consistent year over year and sequential top line quarterly growth, bringing it closer to achieving consistent profitability.

(click to enlarge)

(t) in thousands

The news in Q1 was not all negative. We are impressed that gross margins improved in Q1 to 64.8% compared to 57.7% in Q1 fiscal 2016. Recently implemented lean manufacturing initiatives to streamline operations, which resulted in increased capacity and decreased direct assembly labor costs, as well as a moratorium on medical device taxes, are driving the improved margins. If and Once the FDA warning letter is resolved and revenue begins growing again, improved gross margins should help drive future profitability and business expansion.

Also encouraging is the company posted non-GAAP net income of $175,000 after adjusting for $618,000 professional fees incurred during Q1 for regulatory and litigation matters. The extraordinary professional fees should drop sharply once the FDA issues are resolved.

FDA challenge has a silver lining

There is no question that the FDA warning letter has been a temporary setback for REPR. There are, however, silver linings that will greatly benefit the company going forward.

Addition of Chief Medical Officer . REPR did not have the internal resources to effectively deal with the issues raised in the FDA warning letter and brought in a highly qualified Chief Medical Officer, Dr. Fred Ma. Dr. Ma is not only highly qualified and experienced in his own right, but he also has relationships with external FDA consultants and investigators who are helping to remedy all issues raised in the FDA warning letter. If the FDA issues are resolved, we anticipate Dr. Ma being a vital resource for the company who will be able to drive new product development and bring products to market. Expanding the product portfolio will not only help grow the business but broaden REPR’s appeal to customers, investors and possible suitors.

Establishing pumps and related disposables as part of a delivery system, not individual products . REPR’s offers highly sophisticated mechanical pumps that require disposable needles and tubes, all part of a medication delivery system. Given the scope of the FDA warning letter, we believe the company is likely to update all of its filings with the FDA under one comprehensive 510(k) submission. While such an undertaking requires substantial effort and expense, it would bring all product filings current and clearly establish the pumps and related disposables as parts of a system, not individual products. If approved, all of the company’s pumps and disposables will be under one FDA approved umbrella facilitating better understanding of pump systems for the FDA and of reporting and compliance requirements for the company.

Solidifying relationships with customers . We understand one of REPR’s much smaller competitors has been having a field day trashing REPR by spreading rumors regarding the FDA warning letter and REPR’s status. This has likely given at least some customers pause when considering REPR’s products. The competitor’s strategy, however, could backfire by stimulating a strong customer outreach program by REPR that could not only allay fears and uncertainty concerning the warning letter, but help cement relationships. The fact REPR generated $3.0 million revenue in fiscal Q1 2017 indicates customers are sticking with them, maybe an reflection of the superiority of REPR’s product.

If the FDA warning letter is lifted, the process will have solidified REPR’s standing and market position. If the warning letter is resolved, REPR will benefit in several ways. First, its products will have withstood the most severe scrutiny lending credibility to both the company and its products. Its filings with the FDA will all be current and in good standing for years to come. Finally, management will have established lasting credibility and relationships with FDA staff. In the end, what doesn’t kill you makes you stronger. REPR will come out the other side of this challenge stronger and its shareholders will benefit.

Possible military orders could be a game changer

REPR gave a business update along with preliminary Q4 revenue results in a March 31, 2016, press release . The release included a very intriguing reference to a possible budding relationship with the DOD/military. The CEO commented,

"The military has expressed interest in our products for utilization in emergency applications as well as use in VA hospitals. We believe that because of our performance standards and the reliability of our products, we will provide them with great value and benefits."

Management has made no further comments regarding possible orders from the military which makes sense given the backdrop of what would be a time consuming vetting process by the DOD and the ongoing process to clear the issues detailed in the FDA warning letter. Any order from the military could be material to REPR which generated $12.2 million revenue in fiscal 2016. If REPR can secure a foothold in the military, particularly in VA hospitals, it would be a potential game changer for the Company and its shareholders. We think the fact that the military is interested in REPR’s products could imply that decision makers have a high degree of confidence that REPR will resolve its issues with the FDA.

Assessing risk and reward factors for REPR

We see outsized upside potential for REPR from the stock’s current trading price of around $0.45. Catalysts that could abruptly drive the share price higher include successful resolution of the FDA warning letter and a possible military order. Make no mistake, though, a negative outcome with the FDA could very well imperil REPR’s viability. REPR is therefore an all or nothing bet under the circumstances. Our view is that if the FDA letter will be resolved and related uncertainties are removed, the business will resume a solid growth trajectory. Add to that the possibility of DOD orders from the military, growth in Europe and longer term access to the Asian markets, and we can see REPR exceeding $1.00 per share. At $1.00 and assuming the company only maintains its current annual revenue run-rate of $12 million shares would trade at an EV/S of 2.78. If we bump up the revenue run-rate to $15 million shares would trade at an EV/S of 2.22. We think these targets are very reasonable for a company:

with a recurring revenue model
that appears to be nearing consistent profitability
holds a leading position in the markets it serves
Diversifying its customer base

Research

Fri, 11 Mar 2016 15:43:20 GMT

REPR ($0.38) - On March 9, 2016, REPR issued a press release responding to a FDA warning letter. Yesterday, we offered our initial insight on these events.

We will be watching the filings closely to see if Horton Capital Management buys more shares, as we believe this would indicate it has confidence that the company will likely resolve the FDA concerns or that the concerns may have been overblown in the first place. Recall, Horton has been building a substantial position in REPR, which we have been pointing out with corresponding 13G filings, for the better part of the last quarter.

As part of our ongoing DD, we will remain in constant contact with the Company and take a look at their competitors to determine if their products are designated as “Class 2” or “Class 3” medical products. Here are some bullet points to help readers understand what's going on:

It appears REPR’s Freedom60 has been designated as a Class 2 medical device over the past 10 years
The FDA performs routine on site inspection of the Company’s products. (We believe annually)
Over the course of the existence of the Freedom60 product line, the FDA has performed several of these inspections and has always been supportive of the Class 2 designation.
We find it odd that the FDA issued its warning letter on Feb. 26, 2016 several months after its June 2015 visit where the Class distinction issue was not raised.
Another issue from the warning letter deals with an addition to the Freedom60, the FreedomEdge line, which is a smaller handheld version of the Freedom60. The warning letter seems to imply that the Company did not go through all the protocol to market the FreedomEdge. However, it appears clauses in the FDA regulations pertaining to Class 2 devices allow offshoots for an already approved products.
Our current take on the situation is that the Company needs to do a better job of offering documentation to the FDA that the Freedom pump line is a Class 2 device. The Company may also have to obtain different codes for each drug it currently markets and can deliver through the Freedom60 line. Potentially a product labeling issue.

Research

Thu, 10 Mar 2016 18:24:41 GMT

REPR ($0.37) - REPR put out a press release responding to an FDA warning letter, where they stated:

“On February 26, 2016, RMS Medical Products, Inc. (“RMS”) received a Warning Letter (WL NYK-2016-26) from the New York District Office of US Food and Drug Administration (“FDA”) based on the observations of an FDA inspection which occurred in June 2015.

During the audit, the FDA identified several areas of improvement; many of those items have been completed to the agency’s satisfaction. There are three items that require additional clarification and RMS Medical Products is in the process of addressing these issues and providing the additional documentation needed.

There were no safety concerns raised by the points made in the warning letter.

“While we anticipate one item taking a bit longer to resolve, the others are merely an exercise in better communicating our thorough processes and premium safety standards to the FDA,” said Dr. Fred Ma, Chief Medical Officer at RMS Medical Products. “As always, we remain committed to uncompromised safety and quality for all of our products.”

Yesterday, via premium tweet, we stated:

$REPR down on FDA warning letter, we are looking into the matter. Appears market may be over-reacting. Nibbling as we continue our DD.
$REPR: Warning letter was issued on Feb 26. Appears company has addressed most of the issues. Seems most issues have been resolved.
$REPR: We are banking on the company utilizing its recently approved share repurchase program.

We have some degree of confidence that management will resolve these issues. Since we are unaware of what the one unresolved issue remaining is, investors will speculate what the worst case scenario may be. There are two main risks to consider:

The Company expanded and made improvements to the infusion pump product line, but failed to follow the necessary steps for FDA approval of these actions.
The pump was being used for certain indications that were not yet approved by the FDA.

Worst case scenario is that the company does not gain approval for the expansion of its product line, resulting in a product recall. Furthermore, if the company does not receive quick approval to expand the indications that the product can be used for, its near term growth prospects would be reduced.

It is unclear how much of the Company’s revenue is being derived from delivering medication outside the scope of the FDA approval. We aim to determine if this is an attractive opportunity to add to our position, keeping you up to date. We have talked to management, directing them that they need to offer more guidance on these issues with shareholders.