IntegraMed America ( INMD) Presentation at Oppenheimer Healthcare Conference December 14, 2011 2:10 p.m. ET Executives Jay Higham - CEO Analysts Matt [Nuremberg] - Oppenheimer Presentation Matt [Nuremberg]
Previous Statements by INMD
» IntegraMed America's CEO Discusses Q3 2011 Results - Earnings Call Transcript
» IntegraMed America CEO Discusses Q2 2011 Results - Earnings Call Transcript
» IntegraMed America CEO Discusses Q1 2011 Results - Earnings Call Transcript
» IntegraMed America CEO Discusses Q4 2010 Results - Earnings Call Transcript
The company, as I mentioned, was founded in 1985, so we do have a long track record. We went public in 1992. And we’ve been a public company since then, with many milestones along the way.We started out like a lot of companies do, very small, with limited infrastructure, and we spent the first five to ten years putting all of our investments, incremental new revenue, back into the infrastructure. We have a strong legacy of building a really solid infrastructure that will support the growth in the business. Today we do have a commanding market position in those two healthcare verticals that I mentioned. And in the future we’re going to be able to leverage those investments to very strong earnings growth. And that would be our expectation going forward. If you take a look at the fertility and the vein care market, and just to give you a little bit of a geographical representation of what IntegraMed represents, you can see that in the fertility marketplace we have two different formats that we work in. They’re contract management formats, with fertility centers in the United States. Between those two formats, centers that operate with IntegraMed represent about 25% of the entire US IVF treatment volume. So it’s a very commanding market position. There’s nobody else who even really has a small sliver on a consolidated basis. And with that said, we still have significant growth opportunity, because obviously that 75% of the market is not working with IntegraMed. On the vein care side, we also have a very commanding position. We have 44 vein clinics in operation, and there really isn’t any close number two. It’s a highly fragmented market. So both of these markets are wide-open for us to continue growing and developing in the United States.
We have a strong value proposition to the physicians and the clinics that we work with, and we surround them with a variety of support services that enable those centers and those clinics to be more successful than they otherwise would be on a standalone basis. So integrated IT systems, very sophisticated patient acquisition programs, care coordination, revenue cycle management. Of course we have capital, which is very important for the capital-intensive nature of these two businesses, and a lot of administrative systems.So by surrounding these centers with that level of support, what we’re able to accomplish is to grow these small businesses much more quickly than they are able to grow on a standalone basis, because they’re able to leverage off of these investments that we make in supporting their growth. These are both large addressable and underpenetrated markets. If you take a look at the IVF market as an example, about 7.3 million women, couples, in the United States, do experience infertility, but a very small percentage of those actually access IVF treatment. A little bit greater proportion access infertility treatment, but still there’s a big gap between the number of couples that could benefit from treatment and the number that actually access treatment. The biggest disconnect there is that it’s not a condition that is universally reimbursed by insurance companies. So there’s a fairly significant financial barrier for couples to access sophisticated treatment. I’m not sure that we’re ever going to see a full penetration of the market, but we do see continued upside growth in the market because it is so underpenetrated. The vein care market is even more underpenetrated. There’s about 25 million people in the United States who suffer from varicose veins, and only about 1 in 25 are actually accessing treatment in any one year. And the reason for that is that the treatment historically has been very uncomfortable, the surgical procedure.
About seven, eight years ago, the FDA did provide 510K approval for using a laser to treat varicose veins, and the laser is a much more comfortable, very efficient, and very effective treatment for varicose veins, but it hasn’t fully penetrated the market yet. So we’re seeing very strong growth in this market right now.Read the rest of this transcript for free on seekingalpha.com