First, we offered our Diabetes Management System, without IDA to a healthcare provider group in Kansas City to use in a pilot since September 2014. Since IDA was cleared, we have activated IDA and a patented new companion feature for the group to use.
Our marketing plan is not targeting healthcare providers. We are targeting payers that will require data to be collected, processed and analysed to manage patients. We will be starting our global launch in Canada because we can make it work based on their existing reimbursement set up. We will use that outcome to get reimbursement in other areas.
As you know the System is software. Operating costs are minimal. We have already invested in the heavy up front R&D development costs, continuing upgrades will not be a huge expense. We do not expect $50 per patient per month. We want to price the service to be affordable. Our competitors are pricing their blood glucose management system up at that level. I think your $10 per month is closer to our target.
Accordingly, you are correct in your statement. 3 million patients at $10 per month will yield $30 million a month of revenue with limited operating expenses. Of course, that is only fee for collecting, processing and analysing data to manage patients. There is very valuable information for pharmaceutical companies and health plans that are not available anywhere else. You will get a better picture when we detail our patented innovation as a complement to Insulin Dose Adjustment. I do not know what is a fair price to charge for this data. We will retain professionals to render an opinion on what is fair market value for providing the pharmaceutical companies with de-identified patient data which IMS sells to the pharmaceuticals for billions of dollars. Similarly, we will have valuable data to sell to health plans. Of course, there will be no real significant costs associated with collecting this information from the database.
As I may have mentioned, the ALRT Diabetes Management System is not only targeting insulin dependent diabetes patients. It is designed to manage all diabetes patients. Most importantly, I believe we will offer the only affordable and effective tool that will retard progression of the disease for patients who are no insulin yet. Insulin diabetes patients represents less than 20% of the diabetes population. To contain and reduce cost of diabetes care, focusing on the patients that have not progressed to need insulin is where the effective preventive measures can be taken. Our platform will provide an affordable and effective solution.
Complications due to diabetes is very expensive – blindness, amputation, kidney failure therefore needing kidney transplant or dialysis, stroke and heart attack to name a few. Most diabetes patients have co-morbidities (other chronic illnesses) such as high blood pressure, high cholesterol etc. Controlling diabetes will also control the other chronic diseases.
To have a feel for the scales, there are 60 million insulin dependent diabetes patients in the world and there are 440 million diabetes patients in the world. Our App will address the problem for every one not just the insulin dependent patients.
You will just have to be patient and wait for the unveiling of our full diabetes management App that we expect to share within 45 days.
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