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Monday, November 25, 2019 4:55:46 PM
In detailing its results, the fund offered commentary on a number of its positions. One of the positive contributors for the quarter was Koru Medical (NASDAQ: KRMD) — a medical device company that has a razor/razor blade model. The company recently changed its ticker and company name from Repro-Med (REPR).
The fund had the following to say regarding the company in its investment letter:
"KRMD was the biggest winner in the portfolio in Q3. It is a medical device company that has a razor/razorblade model that enables patients with primary immunodeficiency disease (“PIDD”) to self-administer plasma-derived treatments through subcutaneous infusion. There are roughly 270,000 people with PIDD in the U.S., but only ~70,000 (36%) are currently being treated. The primary reason for this large gap is that PIDD is difficult to diagnose, but awareness has been increasing. As a result, while the population with the disease is growing ~2% per year, the percentage of patients treated is growing closer to 10% per year. However, the story gets better for KRMD. Of the 70,000 patients currently being treated for PIDD, nearly 2/3 of those patients are being treated through intravenous therapy typically with one large dose per month in either a hospital or specialty clinic. This is suboptimal in several ways: it is inconvenient for the customer who has to go to the clinic and then receive a large dose through an IV, it is a high dose of a drug administered all at once (many patients feel sick afterwards and the effectiveness of the drug drops off significantly after a few weeks), and finally, it is very expensive for the healthcare industry since a dedicated facility and nurse are required. This is where KRMD’s solution enters the picture. KRMD’s subcutaneous infusion pump allows the patient to self-administer therapy at home, typically in smaller doses about once per week. The company currently has ~80% market share of the PIDD subcutaneous market--- a market that is growing double digits and offers stable, recurring revenue. I know the drivers of this market fairly well given my previous work on PaySign Inc (PAYS). KRMD is in a different part of the plasma supply chain than PAYS, but nonetheless benefits from double digit secular growth in patient count. I believe the company is undervalued based on their current PIDD and CIPD indications due to 20%+ sustainable revenue growth, 70% gross margins, and significant operating leverage. Moreover, there is a chance that the current management team and board, which is impressive for a micro-cap, can create value by extending the use of their pumps for other emerging subcutaneous drugs. If I am right, the stock could have multiples of upside from current levels."
Recent KRMD News
- Simplifying Subcutaneous Drug Administration: SCHOTT Pharma and KORU Medical Systems Announce Collaboration to Advance Large Volume Subcutaneous Infusion • Business Wire • 06/05/2024 01:00:00 PM
- KORU Medical Systems Announces a New Feasibility Study with a Commercialized Oncology Biologic • Business Wire • 06/04/2024 08:03:00 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 06/03/2024 09:19:50 PM
- Form SC 13G - Statement of acquisition of beneficial ownership by individuals • Edgar (US Regulatory) • 05/23/2024 11:00:28 AM
- Form 8-K - Current report • Edgar (US Regulatory) • 05/14/2024 09:06:19 PM
- KORU Medical Systems Signs Supply Agreement for a Phase III Clinical Trial for a Novel Endocrinological Biologic • Business Wire • 05/14/2024 08:05:00 PM
- KORU Medical Systems, Inc. Announces 2024 First Quarter Financial Results Delivering Double-Digit Revenue Growth • Business Wire • 05/01/2024 08:05:00 PM
- KORU Medical Systems to Report First Quarter 2024 Financial Results on May 1, 2024 • Business Wire • 04/17/2024 11:00:00 AM
- KORU Medical Systems Announces Successful Appeal in EU Notified Body Review • Business Wire • 04/11/2024 08:05:00 PM
- KORU Medical Systems to Present Data Demonstrating 97% Adherence on Its Freedom Infusion System for Large Volume Subcutaneous Administration at NHIA 2024 Conference • Business Wire • 03/18/2024 09:24:00 PM
- KORU Medical Systems, Inc. Announces 2023 Fourth Quarter, Full Year Financial Results, and 2024 Guidance • Business Wire • 03/13/2024 08:05:00 PM
- KORU Medical Systems Announces a Feasibility Study to Enter Ambulatory Infusion Settings with a Commercialized Biologic • Business Wire • 03/11/2024 08:05:00 PM
- KORU Medical Systems Signs a Clinical Supply Agreement for Phase 3 Trial with Leading Pharma Partner Using Custom Device for a Novel Subcutaneous Immunoglobulin • Business Wire • 03/06/2024 12:00:00 PM
- KORU Medical Systems to Report Fourth Quarter and Full Year 2023 Financial Results on March 13, 2024 • Business Wire • 02/21/2024 12:00:00 PM
- KORU Medical Systems to Participate in Piper Sandler’s 35th Annual Healthcare Conference • Business Wire • 11/29/2023 12:00:00 PM
- KORU Medical Systems, Inc. to Host Investor Day on December 5, 2023 • Business Wire • 11/28/2023 01:00:00 PM
- KORU Medical Systems, Inc. Announces Development Agreement for Next-generation Subcutaneous Immunoglobulin Infusion System • Business Wire • 11/08/2023 09:10:00 PM
- KORU Medical Systems, Inc. Appoints Ken Miller as Chief Commercial Officer • Business Wire • 11/08/2023 09:08:00 PM
- KORU Medical Systems, Inc. Announces 2023 Third Quarter Financial Results and Updates Full Year 2023 Outlook • Business Wire • 11/08/2023 09:05:00 PM
- KORU Medical Systems, Inc. Receives FDA 510(k) Clearance for FREEDOM60® Infusion System With Hizentra® 50 ML Prefilled Syringes • Business Wire • 11/07/2023 09:05:00 PM
- KORU Medical Systems to Participate in Upcoming Investor Conferences • Business Wire • 11/02/2023 08:05:00 PM
- KORU Medical Systems to Report Third Quarter Financial Results on November 8, 2023 • Business Wire • 10/25/2023 08:05:00 PM
- KORU Medical Systems to Present Two Abstracts at the Immunoglobulin National Society 2023 National Conference • Business Wire • 10/05/2023 11:05:00 AM
- KORU Medical Systems, Inc. Announces Appointment of Edward Wholihan to Its Board of Directors • Business Wire • 10/04/2023 08:05:00 PM
- KORU Medical Systems to Participate in the Gilmartin Group Emerging Growth Company Showcase • Business Wire • 09/15/2023 12:05:00 PM
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