Health technology company Respiri (ASX: RSH) has unveiled a A$1.5 million capital raising as it fast-tracks its expansion through the US respiratory health market, which is forecast to be worth US$85 billion by 2026.
The funds will be used to accelerate Respiri’s roll-out strategy of its Food and Drug Administration approved wheezo device and software as a service (SaaS) in the US, where the company says there is “strong interest”.
Respiri’s wheezo device and software records breath sounds, which are then analysed in the app for wheeze presence.
The technology allows users to log symptoms, triggers, medication and environmental factors, with data collected to build a personalised profile, which can be shared with healthcare professionals on demand.
Clinical research studies have demonstrated wheezo and its associated technology is “as good as a specialist with a stethoscope” in detecting wheeze.
US market opportunity
About one in 13 people are living with asthma in the US, which equates to about 25 million people.
This results in 1.6 million emergency department visits for asthma management, and Respiri estimates the cost per in-patient medical event is US$8,238.
The US respiratory health market is forecast to grow by more than 30% a year to reach U$85 billion by 2026.
“Wheezo actively addresses this market and has now won its first hospital customers,” Respiri stated.
The company expects this will lead to further uptake and represents a “significant opportunity”, with remote patient monitoring (RPM) reimbursed in the US.
Additionally, Respiri noted US health funds and insurers “understand and fund preventative medicine”.
US roll-out already underway
Respiri’s roll-out in the US, kicked-off nine months ahead of schedule in March this year, with the company revealing a pilot RPM program with the Children’s Hospital of Michigan.
The company’s RPM partner Access Telehealth secured the pilot program and will provide the full RPM solution including patient engagement for a select group of children living with asthma.
Under the pilot, the US Government’s Medicaid government health insurance program will reimburse monthly data fees relating to the wheezo device’s SaaS component.
To solidify its position in the US, Respiri has already identified more than 120 leads including hospitals, payors and doctors.
The company noted its revenue is generated via device sales and ongoing patient SaaS fees.
Additionally, there is minimal competition in this space.
March quarter milestones
With a fast-tracked commercialisation strategy underway in the US, Respiri spent the March quarter increasing its focus on the country.
During the period, Respiri reported “very positive” acceptance of wheezo from physicians, healthcare institutions, payors and accountable care organisations.
To build awareness in the country, Respiri’s senior management spent March speaking with key stakeholders.
Management has planned another trip for all of this month to continue business development, work with the Michigan’s Children’s Hospital and roll-out more income generating integration programs with other hospitals.
The delegation also plans to attend the National Association of Accountable Care Organisations, which is a group of doctors, hospitals and other providers that work together to deliver end-to-end healthcare solutions.
Meanwhile, on the wheezo development side, the company has completed US-application and healthcare portals.
The company noted ongoing development and upgrades were also a standard part of business.
Respiri secured EAS Advisors as its US corporate advisor during the March quarter. EAS is arranging an investor roadshow to begin this month.
The road show will give Respiri the opportunity to present its achievements and plans to banks, institutions, investors and analysts throughout the US.
While advancing wheezo, Respiri’s development team has delivered the company’s second functioning wearable device Sorfe.
Testing of this prototype in humans is expected to begin in the December quarter of this year.
Respiri noted the device will not replace wheezo.
Sorfe has been designed to be worn on the chest and will have a remote patient monitoring capability.
Respiri expects the device will be worn by patients in transition care – after discharge from hospital following a serious asthma of chronic obstructive pulmonary disorder exacerbation.
This transition to home care is a “high-risk period” for re-exacerbation. Respiri noted RPM can help understand whether the patient’s treatment regime is working.
Provisional patents have been filed for Sorfe, with Respiri saying it has already received “strong interest” from key opinion leaders in the US and UK.