winter 2015. this presentation may contain forward-looking statements which are made pursuant to the...
TRANSCRIPT
Winter 2015
This presentation may contain forward-looking statements which are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Investors are cautioned that statements which are not strictly historical statements, including, without limitation, statements regarding the plans, objectives and future financial performance of ScripsAmerica, constitute forward-looking statements which involve risks and uncertainties. The Company’s actual results may differ materially from those anticipated in these forward-looking statements based upon a number of factors, including anticipated operating losses, uncertainties associated with research, development, testing and related regulatory approvals, unproven markets, future capital needs and uncertainty of additional financing, competition, uncertainties associated with intellectual property, complex manufacturing, high quality requirements, dependence on third-party manufacturers, suppliers and collaborators, lack of sales and marketing experience, loss of key personnel, uncertainties associated with market acceptance and adequacy of reimbursement, technological change, and government regulation. For a more detailed description of the risk factors associated with the Company, please refer to the Company’s periodic reports filed with the U.S. Securities and Exchange Commission from time to time, including its Annual Report on Form 10-K for the year ended December 31, 2013. Undue reliance should not be placed on any forward-looking statements, which speak only as of the date of this presentation. The Company undertakes no obligation to update any forward-looking information contained in this presentation.
Safe Harbor Statement
A leading, vertically integrated provider of a range of specialty prescription and over the counter pharmaceuticals and medical supplies Serving large and growing markets:
Specialty Pharmaceuticals & Medical SuppliesRapid Growth, Improving Financial Performance, Projecting Q1 Profits:
Solid Balance Sheet/Minimal Debt ($4MM LOC w/Triumph Healthcare)Exciting growth opportunities:
New ProductsNew GeographiesNew Distributors/Manufacturers
ScripsAmerica, Inc.
2014 (P) 2013 Increase(in millions, except EPS)
Revenues 31.50$ 0.60$ 30.90$
Net (Loss) (1.20)$ (11.30)$ 10.10$
EPS (0.01)$ (0.17)$ 0.16$
Q1 15 (P)
(in millions, except EPS) (3/31/2015)
Revenues $ 9.60
Net Income $ 0.40
EPS $ -
Trading Snapshot
Symbol SCRC
Exchange OTCBB
Price (3/16/15) $0.12
Market Capitalization (3/16/15) ~ $17 MM
52- Week Range $0.08 - $0.22
Average Daily Volume 500,000
Shares Outstanding/Authorized 138MM/250MM
Corporate Headquarters Tysons Corner, Virginia
2008 Founded 2010 Operations Commence 2010 – 2012 Pharmaceutical distribution services (primarily McKesson)
Retail, hospitals, long-term care facilities and government and home care agencies
2013 McKesson squeezes margins, increases chargebacks 2013-2014 ScripsAmerica Pivots to New Growth Strategy
Initial (majority) investment in Main Avenue Pharmacy
New Strategy
oEnter Specialty Pharmacy and Independent Pharmacy distribution marketsoAdding other, complementary products
ScripsAmerica: Evolution of A Healthcare Leader
One Platform – Multiple Opportunities
ScripsAmerica
Wholesale RxMain Avenue
PharmacyEvolving BusinessesPIMD
Diabetic Supplies
RapiMed
E2014 Revenues@$29,000,000.00
February ‘15 Revenues
@$554,000.00
Established Operations Evolving Operations
700+ Patients Signed
$200,000 OrderPending
PhysicianDispensing
Estimated 1% - 5% of population cannot tolerate medications in standard formulas*Specialty pharmacy industry growth drivers:
Shortages of mass-produced drugs Growth in the senior citizen populationIncreased awareness of compounding pharmacies and pharmaceutical applications
Physicians concerned about prescribing narcotic pain medication (e.g. Oxycontin, Vicodin, Hydrocodone) and are looking for alternative delivery systems
Compounding industry:$5 billion in Annual Revenues
“A growing number of doctors and patients will likely turn to compounding pharmacies to prepare medications with alternate doses and strengths”*
*source: IBIS Worldwide
The Specialty Pharmaceuticals Market
Main Avenue Pharmacy acquired Feb. 14, 2014 (100% effective
October 2014) Offering a wide variety of specialty pharmaceutical products to
treat pain, scars, wounds, vitamin deficiencies among others
FDA approved and licensed in 10 states
Additional states being added
Capacity of hundreds of compounding prescriptions/month
In process of expanding
No manufacturing (subject to more restrictive regulations)
ScripsAmerica’s Specialty Pharma Business
Doctor writes prescription
Submitted for payment to Insurance Company/Third party payers
No Medicaid, Medicare
Prescription approved for payment
Order to compound transmitted to Main Avenue Pharmacy
Bill generated & sent to Insurer/3rd Party Payer
Prescription sent FedEx to patient - who must sign return receipt
Total Payment Cycle Time: 35 days
2006
Pre-Approval Avoids Collection Risk
83% reported significant reduction in their pain after using custom-compounded prescription pain creams
On average, survey respondents said the creams reduced their pain levels by more than half Five percent of respondents say the creams completely eliminated their pain 38 % reported reducing other oral pain medications while using the creams > 83 % of respondents said their pain had eased since starting their use of the non-opioid
prescription creams They reported an average reduction of 57 percent in their pain level after directly applying the
creams to the site of their pain, for most recent 24-hour period After 4 weeks, patients reported significant improvement in their physical and emotional quality
of life Six percent of the patients reported minor adverse effects - such as rashes.
Case Study: Just One of ScripsAmerica’s Many Products
• The results demonstrate the ability of locally-applied prescription creams to deliver significant pain relief over time to many patients, without the need for patients to rely on opioids and other narcotics.
• The FDA, quoted in the New York Times, said prescription drugs account for about three-quarters of all drug overdose deaths in the United States, with the number of deaths from narcotic painkillers, or opioids, quadrupling since 1999.
• A 2011 report in the journal Pain Medicine, estimated the total societal cost of prescription opioid abuse at $55.7 billion.
Source: Patient Outcomes Analytics (POA), a research organization, a survey assessing patients' experience with topical prescription pain creams and their impact on the use of other oral pain medications. POA implemented an Institutional Review
Board (IRB) approved protocol to survey and assess patient outcomes.
More than 100 million Americans suffer from chronic pain
Specialty Pharmaceuticals Growth Strategy
Expand Licensing to New States
Add PharmaciesTwo Pharmacies under LOI - will add 30
states
Bring on Additional Marketing Partners
Introduce New Products
RapiMed – Child Pain & Fever Relief tablets-
Approval Pending
PIMD International
Physician Dispensing Program
Diabetic Medical Supplies
Other Growth Platforms
RapiMed Oral Delivery Technology
Rapid Release, Fast Dissolving Fever & Pain Relief Tablets
Over The Counter Product Manufactured in United States
Regulated dosage (80mg, 160mg) for children 2 – 11
Signed Contract with Distributor in China
$200,000 order pending- $60,000 Cost (Attractive Margins)
Oral Tablet that dissolves in 25-35 Seconds
Fruit Flavors-Wild Cherry, Wild Grape
Fast Absorption Into System
Problem: Small chains/individual pharmacies unable to fill prescriptions for controlled substances
Product manufacturers impose minimum order quantities far beyond the needs of the smaller operations
Solution: A DEA and State licensed business that represents independent pharmacies
PIMD licensed by DEA and 14 states for wholesale distribution of Prescription drugs and OTC branded products
Off to good start Revenues
January 2015 $135,000
February 2015 $554,000
PIMD International, LLC
Physician Dispensing Program
Nearly all States have regulations governing the dispensing of drugs by physiciansTypical Regulations:
Dispensing in limited situationsState agencies licensure Limit profits on drugs dispensed by physicians Protect freedom of choice for consumersProcedural controls - such as labeling and record keeping
ScripsAmerica’s PDP program facilitates Physician ComplianceActively Being Marketed - In Discussion with Several Doctors
Goal = 100 dispensing physicians by 12/31/15
Robert Schneiderman, CEO & Founder
Accomplished entrepreneur with proven track record building businesses and creating value for shareholders
CEO of one of Philadelphia’s leading recruitment firms for 32 years
Jeffrey Andrews, CFO
Finance professional with extensive background creating value with public companies
CFO - Global Resource Corporation, Judge Information Management Solutions, and The Judge Group
Other Key Executives
Peter W. Megill, CPA, Corporate Controller 25 years experience
Chad Beene, National Sales Manager 11 years experience
Adam Brosius, Director Business Development 15 years experience
Strong, Experienced Leadership Team
Financial Results
Recent Results of Operations
Significant Improvement
In millions, except EPS 2014 (P) 2013 Improvement
Net Revenues $ 31.5 $ 0.60 + $ 29.9
Operating Income ($ 0.01) ($ 7.4) + $ 7.4
Net (Loss) ( $ 1.2) $(11.3) + $ 10.1
EPS ($ 0.01) ($ 0.17) + $ 0.16
Shares 127.5 68.1
(P) Preliminary results, subject to final audit
March 31, 2015
(Projected)
March 31, 2014
(Actual)
(3 months) (3 months)
Revenue $ 9,600,000 $ 800,000
Operating Income* $ 1,001,000 $ 612
Income (loss) from Operations $ 594,000 ($ 214,000)
Net Income (loss)** $ 407,000 ($1,213,000)
* prior to shares issued for services** due to NOL, no tax liability recognized
First Quarter 2015Profitable
Strong & Improving Financial PositionDecember 31, 2014* December 31, 2013*
(000’s omitted)
Cash $ 730 $ 47 Receivables $ 2,679 $ 1,089 Inventory $ 1,011 $ - 0 - Total Current Assets $ 4,699 $ 1,490
Total Assets $ 5,659 $ 1,781
Line of Credit $ 653 $ 99 Payables & Accruals $ 2,268 $ 227 Purchase Order Financing $ -0 - $ 1,037 Deferred Revenue $ 225 $ -0 - Total Current Liabilities $ 3,349 $ 3,188
Preferred Stock $ 1,043 $ 1,043
Total Equity/(Deficit) ($ 0.1) ($ 3,617)Total Liabilities & Stockholders Equity $ 5,659 $ 1,781
* BALANCE SHEET EXCERPTS
149 Shareholders of record ~ 50% owned by 10 "Friends & Family" Shareholders Preferred Convertible Debt
- $1MM-Held by Board Member, Convertible into 6MM shares Term Debt – $233,000, 9% due 9/2016. Holder: Board member Convertible Debt: $616,000 convertible at $.175 Unsecured Debt $300,000 due 12/2015 A/R Financing of $4,000,000 (Secured) Rapidly decreasing high-cost debt Significant tax loss carryforwards available
Capital Structure 12/31/14 12/31/13
Working Capital $1.350 MM ($1.698 MM)
ScripsAmerica – Summary
Expand the Compounding Rx Business-Add new Pharmacies, Products and Formulations
Launch RapiMeds Launch Physician Dispensing Program Add New Formulations of the Oral Delivery Technology Strategic Acquisitions Eliminate Convertible Notes/Pay Off Unsecured Debt Uplist to Major Exchange
ScripsAmerica – Strategy
Valuation*
2014Multiple of (e) sales @0.60X
*as of 3/13/15
www.scripsamerica.com
Robert Schneiderman, CEO800-957-7622 ext 101
Jeffrey J. Andrews, CFO800-957-7622 ext 102
CONTACT INFORMATION