Health sector innovator Novita Healthcare (ASX: NHL) came out of its trading halt earlier today with the news that it had raised A$2.78 million to fund the commercial growth of its “digital therapeutic” product, TALI.
Novita issued 89.8 million new shares at A$0.031 per share – a 6% discount to its average five-day volume weighted average price.
The health sector tech company said the net proceeds of the placement will be used for “direct to consumer marketing” and sales activities for TALI Train as well as its international expansion including initial TALI “detect pilot programs”.
In addition to the capital raising, Novita executed a heads of agreement to sell Newly to HealthcareLink (HCL), which is an online marketplace for jobs and careers in healthcare and medical industries.
Novita will, however, obtain a seat on the HCL board and a 10% equity interest in HCL as a result, worth around A$1 million.
The combined entity will create a “powerful human resource placement solution in the healthcare sector, driven by deep domain experience of the combined teams and a unique SaaS technology offering”, according to Novita.
“Recruitment spend in Healthcare is $1.5 billion per annum. HealthcareLink and Newly combined will have the capability to create a differentiated and market-leading offer to tackle this massive opportunity whilst allowing Novita to focus on its core strategy with TALI Health,” said Glenn Smith, managing director of Novita.
TALI Health was formed to commercialise intellectual property from an ongoing 20-plus year Monash University neuroscience research project.
The first TALI Health product to be commercialised is TALI Train – a patented digital platform technology providing direct therapeutic activity, delivered not through a pill, but through a game-based experience via an app on a tablet or smartphone.
According to Novita, TALI Train is TALI Health’s flagship application and uses “proprietary software algorithms” to monitor and assist in the treatment of cognitive problems such as attention difficulties in early childhood.
“This successful capital raising along with TALI being recently listed on the ARTG as a class 1 medical device and also becoming a registered provider in the National Disability Insurance Scheme (NDIS) will form the foundation and pathway for Glenn [Smith, managing director] and the team to fast-track the commercialisation of TALI,” said Novita’s chairman Mark Simari.
In addition, HCL has confirmed it will pay Novita an earn-out amount capped at A$300,000, based on a multiple of monthly sales determined 12 months after transaction completion. This sum will be payable in additional equity in HCL.
Going into midday trade, Novita shares were trading at A$0.035 per share, around 6% higher on the day.