HeraMED Limited (1I4.F) Earnings Call Transcript & Summary

Thank you for standing by, and welcome to the HeraMED investor webinar today following several recent key updates and announcements from the company. There will be an initial presentation from management for approximately 20 to 30 minutes, after which we will take questions. [Operator Instructions] On the webinar from HeraMED today, we have the CEO, Anoushka Gungadin; Advisory Board member and Acting CTO, Vivek Krishnan; Chief Clinical Transformation Officer and CMO, Dr. Mandy Khaira; and the CFO and Company Secretary, Cameron Jones. To begin, I'll hand it over to Anoushka. Please go ahead.

Thanks, Matt. Hi, everyone, and welcome. It's really great to be here having this webinar as we lead into the end of the year. So as you would have seen, we have had a few updates in the last couple of weeks. I'll tell you a bit more about that, and then I'll also take an opportunity to introduce our new team members. You know myself and Cameron Jones for a while. We have been around for a little bit longer than Mandy and Vivek. But today, I'll just put a couple of slides up that may make it easier for us to follow. No, that's the wrong one. Hold on a sec. We should have done it your way, Matt. Start with the -- there we go. I think this is the right one. Perfect. Is this working all right? Can you all see it?

Yes.

Okay. All right. So we announced the TGA approval and then followed by the Philips announcement as well as the Lee Health pilot. So around the TGA approval today, the HeraBEAT has got the Class IIb approval. It took us about a year to work with the TGA after they did a full overhaul of the market and wanted to regulate it, which we very much welcome. As a result of that process today, the HeraBEAT is the only fetal heart rate monitor in Australia that can be used at home under clinical supervision, which is our model. And so that was that. And we also then -- just prior to that, also launched our AI and innovation road map. I'm bringing this up because today we have Vivek and Mandy as well, who will be able to add a bit more color to that. But very excitingly, we've got Philips, a deal that I have been working on for close to a year with a number of stakeholders internally there and also within our team. So the deal with Philips really starts with a joint offering our platform and all the devices as well as some of the services that they have, be it coaching around maternity, all the devices, cellular devices, blood pressure monitor, glucose monitoring and area of that. So together, we are today able to offer this -- United States a solution for maternity care. We are starting in one state. So we've got a target list. We've got a sales plan we've put together and continue to expand on that. So we are going to hit the ground running next year. We have got a target list. We've got a product. There's a number of warm relationship that already exists because about 50% of the hospitals in the U.S. are Philips hospital. So leveraging what they have and what we bring in terms of a very solid, robust platform, we're feeling very confident in the direction that we are going. Now we're starting in maternity and pregnancy. I would like you to think about Philips being a very -- a global company and thinking of U.S. as a starting point and maternity as well as a starting point. What I mean by that is, as a company, we are expanding across women's health, not just pregnancy, maternity and postpartum care. I'll tell you a little bit more about that and the reasoning behind that. So that's a bit about Philips. It took about a year to get to this point, and I'm really very happy that we could announce this before the end of the year, setting us up for next year to really go and be in market and present this and look at onboarding the first hospitals. There is a list of about a dozen that is already there that we will be targeting. So that's about Philips. The next update we had was a pilot launch in Lee Health. Now this one is a lot longer. I was in Florida last year in July, August, and I met with them. And that very first face-to-face meeting after having had a few other conversations, brought about 25 people in the room from across their exec team, their tech team, their midwives, their clinical team. So there was a lot of buy-in from the very start. They bought all the stakeholders. And throughout these number of months, we have actually been engaging, I would say, up to about 40 people across different areas. And to be able now to launch this pilot and work on this over the next 6 months is really very exciting again for us. We are looking at a new model of care. Part of the KPIs here is could we be delivering maternity care remotely at the same level of care, at the same level of safety. More further, do we need the number of visits that we are still doing? Resilient care and the number of visits that we all do today, women who are pregnant or your partners, is still the same number of visits that were prescribed about 100 years ago. So surely, it's time to look at that. So this pilot allows us to look at this. There's another very exciting part of this pilot, and it is an implementation to be able to integrate into Epic. So part of our next 6 months is also to scope that out and to be able to provide that road map. Again, I feel very confident in what we can do and deliver. We have Vivek Krishnan in the room, and that's really his area of expertise. Now I wanted to touch on where we are and why we're expanding. So we have done close to 5,000 women through the program. We have a platform that has supported these women through a number of pilots and implementation. What we know is we are seeing outcomes that are improving, be it early detection of complication, be it being able to catch somebody at a critical time and perhaps deliver the baby at that time. This platform is really delivering personalized care to an individual in her home with continuous care from the clinical team. Pregnancy and maternity is a window into later life health for women. Any high-risk pregnancy actually put them at higher risk of having a cardiac issue or around diabetes as well as mental health. And those are the big, personalized care plans that we have through pregnancy and maternity. Women are also diagnosed about 4 to 5 years later for any of these diseases. And we are treated like men, although we are not little men in the press. We are actually women. And we have a very different body, different needs. Therefore, this absolutely makes sense to be able to expand. And when we look at what the market wants, they do not want another point solution. They want something that is able to follow somebody across. So today, our platform is device agnostic, EMR agnostic, and we are moving to support women's health across their life stages, including chronic care. We continue to work with clinicians to help them be able to deliver those care. So our role is still to provide a solid intelligent platform. So building AI capabilities, having our HIPAA compliance, all of those become extremely important. Next part of that is also around some of the dashboard and reporting that we are doing. When I pass on to Mandy, she'll be able to talk about some of those dashboards in her experience and what she has done and what can come out of those when we're looking at population health. And if you look at this from an investment perspective, we were in one vertical. We've done that very well. We feel very strongly to be going out. I mean the 2 announcement we have done, Lee and Philips, are happening because they have gone and done the market [ stream ]. They have seen what's out there, and they have seen every care. So that's not just me saying this. Now there's more than me and our team being able to experience this and see this. So this absolutely makes sense. We're expanding from one vertical that the size of the addressable market is growing. The time is now. Women's health is absolutely everywhere. I just came back from the health conference in the U.S. About 14,000 people were there. I can tell you, women's health was not in one area. It was across everything. New funds were being brought up, new products, innovation and certainly looking for a solution that does what we do is required, and at the moment, there is no one doing that. With this, I will introduce our fabulous team. And the team gave me huge confidence in what we can do next year. What I have been able to share today when you think about our presence in the U.S., it was really myself driving a lot of this. Today, we have got an incredible team behind us based in the U.S. as well as here in Australia. So I'll start with Sharon Howell, who couldn't join us today. She's stuck in transition. But Sharon started as an Advisory Board member. I worked with her for about a year and really getting a lot of advice around the U.S. go to market. Her knowledge, her connections are incredible. And I am so delighted that after working with us for a year, she has joined the Board as Non-Executive Director. So we will continue to work with Sharon and in a lot stronger way. We also have, in the U.S., appointed Jeff Garibaldi as Chief Growth Officer. Jeff has more than 35 years of health care experience. He has done a couple of exits, $700 million valuation. He's taken businesses to IPO. He has invented. He's got patents. He has done a great deal in the space of health care, very well connected, understands the market, very, very knowledgeable. He couldn't be here today. However, it's with my great pleasure to introduce Dr. Mandy Khaira, who has just joined us in October. So Mandy started her career as -- in OB/GYN and is joining HeraMED as Chief Legal Transformation Officer as well as Chief Medical Officer. And we also have Vivek Krishnan today with us. Vivek started as part of our Advisory Board member. He has now joined us as acting CTO, which is fantastic for me. I absolutely love working with Vivek. He's an expert in everything EMR tech as well as AI. We have a new -- we have set up a team under his supervision, and I can tell you what we have on the road map. We have the capabilities to be able to deliver that. With that, I will pass on to -- I might start with you, Mandy, to do an introduction, and then I'll pass on to you, Vivek, and then we can open for questions. Thank you.

Thank you, Anoushka. It's such a pleasure to be here today, Cameron, and really excited to meet you. As Anoushka mentioned, I am Mandy Khaira, the Chief Medical and Clinical Transformation Officer here at HeraMED. I'm a physician executive by background with nearly 25 years of experience, specifically in clinical transformation, operational scale and value-based care strategy, and I've worked across payers, health systems and physician organizations. As Anoushka mentioned, I started as a practicing internist in an OB/GYN clinic. And that's where the care in women's health kind of grounded me in understanding more around the design principles behind management. I moved into management at that time, and before joining HeraMED, I founded Nuva Ventures, which is an advisory firm that supports digital health and VBC organizations in designing clinically credible, full operating frameworks and also developing commercialization strategies. Prior to Nuva, I spent nearly 8 years at Navvis Healthcare, which is a population health enablement organization, started as a consulting company worth about $14 million when I joined in 2017, and we scaled it to $663 million national population health enterprise. I served as their Chief Medical Officer, Chief Clinical Transformation Officer and Chief Learning Officer. All 3 were inaugural roles in that company. So what we were able to do there was to architect and operationalize the entire value-based care infrastructure across 11 markets. And the things that I oversaw included clinical models, analytics, population health, operations, quality programs, accreditation, learning and development. Prior to that, I served at BAYADA Home Health Care, which is a $2 billion global home health organization. It has operations in U.S. but also in Europe and Asia. I led population health initiatives across 22 states for them and in more than 100 service offices. And before that, I was with Main Line Health System, which is a $2.4 billion health system and where I helped drive major system-wide transformation efforts to expand access, clinical quality and care delivery operations. Happy to answer any questions you might have.

Thank you, Mandy. I'll pass on to you, Vivek.

Thank you, Anoushka, for the kind introduction. Hi, everyone. I'm Vivek Krishnan. Very glad to be here this morning. Like Anoushka said, I'm HeraMED's acting CTO and Board Adviser. As you would have seen in the AI road map, we are undertaking some exciting and meaningful work that positions us for the next phase of scale and operation. My role so far has been to strengthen the engineering -- in the engineering organization, modernizing the underlying platform and while ensuring cost discipline as well and working with Mandy, Jeff and others around aligning our AI strategy -- commercially aligning the AI strategy that is safe and clinically responsible as well. A bit of a background about myself. I've spent almost 2 decades now in the health care technology across U.K., Australia and New Zealand market with a particular focus on AI, EMR interoperability, clinical workflows and enterprise-scale platforms. Now previously, I was the CTO of Alcidion, another ASX-listed company, where I led EMR-integrated clinical systems and workflows, and I was part of the early growth. And until last year, I was part of the journey where not only we built some great technology that scaled for major organizations but also led commercial penetration into the various different markets as well. The AI road map, as you would have all seen, we have laid out is not a blue sky research exercise. It is practical. And as you all heard from Anoushka around the women's health and our vision around providing a complete solution and complete package to the women out there, that's kind of what we have put together so that it's a practical stage plan focus that not only reduces clinical workflow -- workload through automation but also improves the patient engagement and early detection as well so that we can monitor the population at scale as well as use the devices that we have got alongside with ourselves. So not only the AI road map and which you all have seen has been keeping us busy and the team busy but we have already done some great work integrating some devices, some new devices with our platform to support our agnostic approach. We have integrated Garmin. We have integrated a new other point devices, which is really helping us to expand our platform into the places that we have not been before. So that's a little bit about me, but we have a very busy next 6 months ahead of ourselves as we integrate ourselves into some of the major EMR vendors like Epic, Oracle Health into systems, et cetera, and support the projects that we have just started with Lee Health, for example, and integrating closely with Philips as well so that we can then expand into that market more confidently and in a closed loop approach. So that's a bit about myself and what we are doing. Happy to answer any questions and to support the strategy.

Thanks, Vivek. Thank you, Mandy. As you can see, I'm very well surrounded with great expertise in the house. Okay. Matt, I'm happy to open for questions.

Right. Thanks, Anoushka and to the rest of the team. [Operator Instructions] But firstly, Anoushka, I was going to ask, in terms of sort of next or new opportunities, you've obviously just had some really exciting ones come through, but what sort of partners or groups are you and the team most focused on going forward?

Yes. I think providers, the health system is still top in our list. And we have others in the pipeline even from -- as you would have seen with what I said, it takes 12 months. That's -- it's a long cycle. We need to engage with them throughout. So providers is still very much a top priority. Second to that, not much lower but probably a newer one for us that we are working through is around payers and really understanding that world. We're getting now -- with Mandy onboard and Jeff, we have a better understanding of the payers' world. And that's -- they work hand in hand and a lot is changing in the U.S., so we've got to understand that and how we facilitate some of that. And then perhaps through Philips, it's one partnership with them, but targeting other hospitals is also a priority for the next 6 months for us. Mandy, do you want to add any color around payers?

Yes, absolutely. I want to add it from the VBC angle. I want to mention that we are equipped to commercialize across every major value-based care channel. So the capabilities we have today and the ones we are expanding toward in the continuum of care will equip us to not only work with health systems who are seeking to improve women's health outcomes, which is 50% of their population but will also be able to partner with Medicare Advantage, Medicaid commercial plans to strengthen quality performance and reduce total cost of care. In that way, we'll be getting a portion of their PMPM. So that's the whole part of shared savings alignment. In addition to that, we are equipped to align with MSSP and reach ACOs and create a very clear opportunity around...

You have to explain a little bit of the acronyms because in Australia, we don't have the same, so VBC, PMPM. I mean I get it. I've been around now, but yes, it might be helpful for our audience if you'd explain a little bit.

Absolutely. So ACOs are accountable care organizations, which are set up essentially as a conduit to lower the cost of care while improving major outcomes, and they get paid through CMS reimbursement models as well as through payers for those arrangements. Now as an organization, which is a digital health organization that's enabling those outcomes directly as you would see in our recent data, we are well equipped to become partners with those organizations and share in those savings. So they save dollars every time they reduce toward cost of care, reduce readmission rates or improve the quality of care. And we are equipped to demonstrate that we do exactly that and share in those savings. I also want to mention that we have multiple channels of revenue generation through VBC and those include capitation-based, per person per month contracts. We could also go into maternity and chronic bundled payments, which are through CMS. And then we have an opportunity in performance-based incentives as well. Now Anoushka, you mentioned regulatory. Do you want me to just go through that quickly just to help understand the environment?

Yes, that would be good.

All right. So very recently, the good news for us is in 2025, a lot's changed for digital health in the U.S. Prior to 2025, the reimbursement for digital health was difficult, and you had to prove quite a bit. You still didn't get full reimbursement. But since then, they have released multiple -- they mean CMS has released multiple policies, which have added expanded flexibility for remote patient monitoring and remote therapeutic monitoring. And so those barriers are lower now. Also, the maternal health equity requirements are tightening. So that means payers and providers want solutions that can close those access gaps, so they can tap into that revenue stream. And very recently, just 2 days ago, CMS, which is the regulatory body here in U.S.A., released a new access model. And what it does is very unique. Before that, I don't remember any scope where a digital health vendor could actually get reimbursed directly in relation with CMS, and this opens up a formal pathway for us to be reviewed and recognized as eligible for reimbursement for Medicare participants. And so that is huge in terms of continuum of care. Think about perimenopause, menopause, chronic conditions, behavioral health. And so we now have an opportunity to become part of that tools directory and not just be recognized but have partnerships come to us versus us seeking them out. So that's something that we'll be thinking about in terms of putting on our road map.

Yes. A lot of changes. The first 6 months of this year were quite chaotic but I have to say, on this side, being able to see what's coming up and with the in-house expertise to be able to align to those -- I mean, the thing is it's not just a plug and play, but knowing what's out there and knowing how we can align is what we will be doing as well over the next 6 months to set us up. And having a partner like Philips, where we're going to market, having a partner like Lee Health, where we're actually implementing in a system will make those learnings a lot faster. Yes. Matt, over to you.

Thanks, Anoushka. And I was going to ask another question on just that you've alluded to. So obviously, Philips and Lee Health have taken quite a long time to come to fruition and be able to announce those partnerships. So can you just give a bit more color on how much time each of those groups spent looking at HeraMED before they did that partnership and sort of what went into that?

Yes. I mean it's not just those 2 that take a long time. I think I want to really let everyone know in health and Mandy and Vivek, you both have [ sold in ] that space. Like the 12 months is a normal sales cycle. It's true we're dealing with life. We're bringing technology. We're bringing a new model of care. It has to. At the same time, whenever we deal with large organization, there are layers and layers and layers that we need to work through. So they took between 12 and 14 months, each of this 1 -- and there would be periods where we are having weekly touch points with a dozen people. So it's not like one-off. It just does take that long. There are others we are probably 6 months through and some newer one. But with the team now in the U.S., what we're also doing is expanding the -- at the top of the funnel who we are bringing in. There's a lot of warm introductions through our now U.S.-based teams. So the more we have at the top, even if it takes 12 months, the likelihood to convert more than 1 or 2 is also there.

And then another related question in terms of Lee, I think you touched on it. But what were they doing prior to this, I guess, or prior to the idea of using HeraMED's technology? What was the system they had in place?

Well, they tried to build theirs twice, a version of it. So -- and then we've been talking for the last 12 months. Lee Health is a very digitally advanced hospital. They have been using Epic for a very long time. In fact, a lot of new products or features, they would test them. So they have been well on their journey of digital health. However, what we bring, personalized care, escalation of care, being able to do a lot of the work without the human touch and still deliver the quality and safety of care and doing the triaging so that the specialists or the nurse is only there when required, however care continues to be provided, they didn't have that, so really around that patient engagement. They're -- we know if a patient is engaged in her care, the chances of becoming high risk are lower. If you are empowered -- so this is we go -- I mean, patient empowerment in this world of women's health is very critical in terms of how we prevent complication and not get it to a point where we're spending a lot of time, a lot of money, not sure about the outcome. So this is a major driver here for them. They have been a digital hospital for a very long time. Looking at a hospital at home model is probably now where we are all playing together with them.

If I may add, Anoushka, to that -- so just to add on to what Anoushka said earlier about sales cycles and our engagement with different customers, when it goes through different layers, obviously, the technical validation and one of the critical things in health care is that the systems talk to each other. We don't just go and add on our system on top of the existing but how do we sit alongside with their existing processes, workflows and systems that they have got. So fortunately and unfortunately, it does take time to go through that journey, but the end result is usually quite rewarding. Now when it comes to just the most recent question from Matt around the Lee, for example, with remote patient monitoring, one of the challenges is the patient engagement as well. And not only Lee, but our previous customers have also used remote patient monitoring but always failed to capture that patient engagement where the adherence may not be there, et cetera. And that's where our platform excels basically where the -- not only the user interface and the escalation protocols, et cetera, that we've got, but we have got measured metrics around how well we engage with the mothers, which is what the customers likely are looking for rather than putting yet another Zoom or, let's say, a person behind a phone to give a call to the patient, which fails at scale. So we are quite ready to scale with them, which is what they are looking for, from monitoring one mother to thousands. We can do that, and we can ensure that they are being engaged quite well in their journey. Whether they're critical or noncritical, the platform doesn't have that bias. However, they have -- the platform has those escalation policies to engage with the different type of patients who are in the journey with the Lee care. So we are quite ready in that sense and which is why we believe that the platform will not only talk to their Epic or the other systems but also sit alongside with their existing processes and then help to engage with their patients in a more cohesive manner than what they were doing previously.

Thanks, Vivek.

And one more thing I'll just add quickly is one of the greatest things that we can do that doesn't exist today, especially for programs, which are focused on women's health, is data. So most of the health systems, payers, physician organizations actually don't have data on their own population. So by enrolling a cohort of population and sort of helping them transcend not just maternity but the continuum of care across chronic conditions, we are going to end up with reservoir of data, which in itself is very credible and very valuable because it drives value-based care savings for all of these systems at a national level without which they cannot have a claim at those revenue channels. So I just wanted to add that that's an important part of our future road map, those dashboards as well as using that data to our advantage in the marketplace.

Thank you. Anoushka, you've talked obviously -- we've talked a lot about the opportunities here. Can you just maybe speak to what are the main challenges that you foresee, sort of what -- the so-called what keeps you up at night question?

I think where we are now perhaps thinking on how we scale from a tech perspective, it's solid. We can scale with what's ahead of us. But really, that's part of the planning. A partner like Philips can take us from 0 to 100 in a very short time, and we are working with them around how scale looks like. And I'm talking about the people, then the training, putting the processes in, where it's streamlined. It's rinse and repeat. It's not -- you're doing in a very efficient way. So those are also part of our thinking for next year. But you know what, it's a good problem to have, so I don't mind.

Thank you. I mean can you perhaps, in just general terms, speak to what your shareholders and potential investors should be looking out for as we go into the new year in terms of news flow and developments on all this?

Yes. So we -- over the next 6 months, I would say we have to operationalize and implement these 2 partnerships that we have for us to be able to make sure we delight them. What we have started, it's a process dynamic. We are, along the way, codesigning what we are measuring, what will be the outcome of those, but making sure we're doing it the right way. It's not just getting the next one and not delivering. So that's really, really critical. With Philips, we're going to market to -- that's the next step. So we should be looking at what pilots or hospital implementations we will have, building our capability to talk about dashboard, for example. That's another product. And that product helps us sell faster or shorten that sales cycle because we are able to take that product and show revenue that a hospital at the moment is not getting. So for us, it's being very -- there's a lot of things we could do. I think prioritizing the ones that are going to get us commercially where we want to go faster is what we are prioritizing. So they are the company's plan. The tech supports that. And that's really how it works. So that prioritization is there. Building our brand visibility is also one of the -- what we will be launching in the next 6 months. And I would say it came to mind and it's gone. Around that, it's also -- we're building some more KOLs in the states. So I would say watch this space for some of the people we're talking to who will bring in incredible commercial and scientific capability into our business. So I am very excited with what's happening, and I should be able to provide some of that news. We are able to attract some incredible KOLs. And that's also multiple months of conversation to the point when they are ready to put their name and talk about HeraMED because of what they have learned and what they see. So I think that's what we should be watching for in the next 6 months. As well as, I would say, the first version of some of our AI capability, be it the scribe, the companion. With what we're doing at Lee Health, for example, building patient engagement, looking at a hospital at home model, that will inform some of the AI companion capability that we are creating. So it's not a build and they will come. It's more like let's build it with the client and see what the market needs, and that's what we are doing. There's a fair bit of codesign work in our approach.

Thanks, Anoushka, and to you and the team. I'll just hand it back to you to provide a closing comment.

Thank you. Before I do, I'll ask Cam, CFO, Co Sec. Anything Cam, you want to add or...

Nothing else to add. I think really well summarized. Excited to have such a great team and working towards executing on these 2 partnerships over the next -- over the short term.

Thank you. Well, then I will say thank you to everyone. I know there's a lot in the room who have supported us, believed in us, so I'm very delighted to be able to provide you with this feedback and introduce you to some of the team members. There will be others, and there will be an opportunity to do that. So thank you for your support, and I would say watch this space. And happy to have follow-up conversations and any questions available for a conversation any time. Thank you. Thanks, Matt.