LabStyle's mHealth Technology is on the Forefront of the Revolution in Healthcare that is Forecasted to Generate $32.4 Billion in Revenues
NEW YORK, NY / ACCESSWIRE / December 3, 2015 / A recent report by Goldman Sachs states, "Digital healthcare, though still in early stages of development, can revolutionize the healthcare industry…digital healthcare promises affordable, highly efficacious, and easily accessible patient solutions." Near-term revenue forecast for companies in the market is $32.4 billion, with 45% coming from remote patient monitoring, 37% from telehealth, and 18% from behavioral modifications, according to Goldman. Chronic diseases including heart disease, asthma, and diabetes, accounting for $1.1 trillion in US healthcare expenditures annually, are described as being at the 'bulls eye' of the healthcare cost challenge and therefore where digital healthcare can make the biggest impact.
I've written about LabStyle Innovations (DRIO) and currently have a buy recommendation on the company with a near term price target of $3.50 per share. It's currently trading at $.36, offering huge upside opportunity. LabStyle makes and sells patented digital healthcare technology providing consumers with blood glucose testing capabilities using the owner's smart mobile devices. The Dario(TM) Blood Glucose Monitoring System, the company's flagship product, is a platform that combines an all-in-one, blood glucose meter, smart phone application, website application and treatment tools to help diabetics become more proactive in their disease. Through the cloud, data can be quickly viewed by doctors, parents and other care-givers for proactive treatment and better-informed decision making. This is truly the essence of digital healthcare. LabStyle generates revenues through sales of its app, glucose strips, and perhaps most importantly, software services with digital data feeds to caregivers.
Recently launched in several markets including Australia, Canada, and Israel, Dario's user experience reviews are phenomenal and case studies presented at scientific conferences show that users, now able to self-manage thanks to the Dario, are healthier and happier.
Dario proves the point made by the Goldman Sachs report - that digital healthcare can empower patients, reduce ballooning healthcare costs and improve the quality of healthcare. LabStyle will certainly be a major player tapping into this $32.4 billion revenue opportunity, especially after it receives FDA approval for the Dario, which may happen in the coming months, according to company press releases.
Shooting beyond diabetes, LabStyle received a U.S. patent giving it IP rights to monitor other chronic diseases via blood testing on mobile platforms. Monitoring of heart disease is a next logical next step for LabStyle. Goldman Sachs reports that digital healthcare of diabetes, heart disease, and asthma, together can have a total economic impacts including creating a savings of $200 billion in the U.S. and a commercial opportunity for companies in the space of $15 billion. Eight out of every $10 spent on healthcare goes towards chronic diseases.
Driving the adoption of digital healthcare technologies like LabStyle's, in addition to user and doctor preference, is plain and simple cost savings. US healthcare spending outpaced GDP in 43 of the last 50 years and each year, consumers are burdened with an increasing proportion of these costs. Insurers and the insured are all looking for lower cost, highly effective healthcare solutions. The adoption of digital healthcare technologies like the Dario can create a total savings opportunity of $305 billion in the U.S. according to Goldman Sachs.
The FDA is clearly eager to get digital healthcare solutions through the approval pipeline. 100 mobile health apps have been approved by the FDA. The ubiquity of smartphones is a major driver. According the Pew Research Center, 75% of Americans used their smartphones for healthcare information and the number of people over the age of 67 who used smartphones increased by 50% from the prior year. Doctors, patients, hospitals, and insurers all benefit from digital healthcare, and more importantly all parties are looking to adopt it. We agree with Goldman. LabStyle can revolutionize healthcare.
RAY DIRKS Research suggests that Readers/Investors place no more than 1% of the funds they devote to common stocks in any one issue. It's best to diversify.
About Ray Dirks
Ray Dirks came to Wall Street with Goldman, Sachs & Co. in 1963 where he was established as the leading insurance stock analyst dealing with institutional investors and high -net worth investors both in the U.S. and internationally.
In 1973 Ray uncovered the biggest Ponzi scheme of the 20th century, the Equity Funding fraud. Over the years Ray has expanded his stock market research to include Healthcare Stocks and Special Situations. Ray has written two books,"The Great Wall Street Scandal" and "Heads You Win, Tails You Win", published by McGraw-Hill and Bantam Books respectively. He continues to provide research to institutions and individuals, and he manages money for some individual investors.
SOURCE: RAY DIRKS Research