Dear Investor,
As you know, we continue to wait for a decision on our bid for the two-county pilot program in Kentucky — funded in part by the U.S. Department of Justice “Harold Rogers Prescription Drug Diversion Monitoring Fund” — to test our provisional patented Verified Prescription SafeguardsTM system as a new national standard — and solution — to prevention of Medicaid fraud and drug diversion.
Regarding the current SEC filing status: As you know, we are a startup company with limited liquidity. The timeframe of Kentucky’s Request for Proposal and bid acceptance — which by all rights was to have been completed by October 2002 — was substantially delayed by the Department of Justice far beyond anyone’s imagination, particularly Rep. Hal Rogers’. (Ironic that the originating mandate of House Bill 26, enacted April 9, 2002, “declaring an emergency”, has yet to be fulfilled.) And although we have had many direct assurances the RFP and bid process will be expedited, we continue to wait word on the contract. These occurrences that caused delays now approaching six months have substantially affected the Company’s ability to secure liquid funds in a timely fashion so as to complete the required audit and post the overdue 10Q and 10K filings.
Be assured, the Company has put every effort and resource into securing those funds, just as it put every effort and resource into ensuring the contract proposal would be submitted by the April 10, 2003, deadline. Given the choice of meeting one, but not both, deadlines, your management team made the rightful choice of ensuring the Kentucky RFP response was submitted on time. We trust our shareholders will agree that was the correct decision.
The Company continues to believe its response to the Request For Proposal (RFP) will be favorably reviewed by the Finance Cabinet, the Cabinet for Health Services, and the Governor’s Office for Technology. We are further confident that the Company was the only organization to receive the requisite “letters of participation” from the two regional hospitals mandated by the RFP. Although we do not yet know when the announcement of bid acceptance will be made, we are confident the process will continue to be expedited.
Under the terms of the contract specifications, we will have two months to develop the fully functional VPS system, followed by a three-month test period, and an additional four-month evaluation of the project by an independent consultant.
Although the two-county pilot project is our key concern, be assured that Kentucky is not our sole focus. We are working with several other states, any of which could supercede Kentucky's current leadership role in drug diversion monitoring. In all, 21 states now have drug diversion monitoring regulations in place — and that list is growing. We have formally contacted the highest level controlling authority (governor, attorney general, or licensure board) in each of those states regarding our provisional patent and willingness to work within increasingly tightened state budgets to implement a system that will save literally millions of dollars in Medicaid overruns — as well as save millions of lives through the reduction of prescription drug diversion. All 21 states have formally acknowledged our provisional patent. We know of several states that are waiting for results from Kentucky before making a decision regarding drug diversion monitoring.
As always, we thank you for your continued interest in and support of the Verified Prescription Safeguards System.
Best wishes,
James Kemper Millard
President & Chief Executive Officer
Equity Technologies & Resources, Inc.
325 West Main Street, Suite 240
Post Office Box 12012
Lexington, Kentucky 40579
VOX: 859.268.4446
eFAX: 419.821.3646
This communication may contain forward-looking statements. The Company expressly disclaims any intent or obligation to update any forward-looking statements.
Verified Prescription Safeguards and VPS are trademarks of Verified Prescription Safeguards, Inc., a wholly owned subsidiary of Equity Technologies & Resources, Inc. Envoii is a trademark of Envoii, Inc.
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