RegenMed was founded – and operates – on a fundamental financial principle: the most valuable company is that which can establish and then grow recurring revenues across a diverse client base.  It is thus distinctive from many other forms of healthcare investments.

The Challenges For Pre-Revenue Healthcare Companies

Healthcare is obviously an enormous market – in the United States alone, it represents fully 17% of the country’s GDP. ¹

There are therefore thousands of investment opportunities, both with established and newer companies. Many of the latter tend to be bets on new products with any revenues far into the future.  While some of these bets pay off, the great majority do not.

Unfortunately, it is very difficult even for the largest drug companies to predict which of their clinical trials will prove successful.  On average, 14% of drugs and vaccines that enter clinical trials receive regulatory approval.  (Only 2% for oncology drugs.)

The Financial Consequences

Only the best capitalized companies can withstand the financial implications of this reality.  In 2023, biotech bankruptcies reached a 10-year high, with more companies filing for bankruptcy than any year since 2010.  This trend continued into 2024, with 22 biotech companies shutting down. ²

Indeed, the broader healthcare industry also saw a surge in bankruptcies.  In 2023, 79 healthcare companies with liabilities of at least $10 million filed for bankruptcy, more than triple the number in 2021. ³ In 2023, 17 out of 80 healthcare bankruptcies (21%) involved private equity-backed firms, marking a 112.5% increase over the past five years. ⁴

How RegenMed Is Different

RegenMed is selling shovels to gold miners – its patented product Circles is needed by any medical provider or product manufacturer which needs to conduct a clinical study.  (As discussed in an earlier post, RegenMed also participates with its clients in the monetization of those studies.)  

RegenMed has established a strong product-market fit, with revenues earned from a broad variety of clients in North America, Europe and elsewhere.  Those revenues are recurring and growing – the company’s business model is predicated on monthly subscriptions and small per Case charges.  This low pricing is an important competitive moat in today’s far-too-expensive healthcare world.  It also allows rapid scaling.  

RegenMed is led by an experienced management team with proven track records.  They know that “slow and steady” wins the race.  They focus on cash earnings, minimizing debt, and continuing to scale the Company’s established product-market fit in its large addressable markets.