The share price of digital medication management company MedAdvisor Ltd (ASX: MDR) has risen 20% to 4.8 cents in morning trade following the announcement that it has signed a Co-Marketing and Licence Agreement with PDX Inc, a large U.S. pharmacy dispensing software company.
MedAdvisor provides individuals and carers a medication management platform via its mobile and web apps to assist them in monitoring the use and adherence of prescription medication. The rise in internet connected devices provides an opportunity to deliver a solution for the issue of noncompliance of prescribed medication. The company services over 1 million users across Australia with connections to approximately 50% of pharmacies and general practitioners.
U.S. expansion
PDX is a provider of clinical software and specialist pharmacy solutions that services over 10,000 pharmacies in the U.S. The company's market share represents approximately 15% of the total pharmacy market in the U.S. and is 10 times larger than the Australian pharmacy market. This is MedAdvisor's first step towards its roll-out and commercialistion in the U.S. market with integration set to commence in the first half of FY19. The Licence Agreement is non-exclusive and will allow both parties access to and the usage of the other parties' software to facilitate the integration.
The agreement will enable MedAdvisor to provide a complete solution to pharmacies using PDX's software to manage interactions with digital customers that includes ordering via the MedAdvisor app. The company is well funded with a cash balance of $10.8 million as at 30 March 2018 to meet the projected rise in expenditure in order to complete the integration. MedAdvisor also noted in this morning's announcement that it has the capacity to continue to expand domestically in Australia and progress any international opportunities.
MedAdvisor is one of the more intriguing small cap stocks operating in the healthcare space on the Australian market. Other small cap healthcare companies with a lot of potential that investors should consider monitoring include breast screening technology company Volpara Health Technologies Ltd (ASX: VHT) and healthcare provider Zenitas Healthcare Ltd (ASX: ZNT).
