Spotlight On Healwell AI Inc.

In this edition of Investor Breakout Spotlight, we unpack why Healwell AI’s stock is surging, as the healthcare technology trailblazer reshapes the way we approach medical diagnosis, treatment, and patient care.

TSX: AIDX

Healwell AI Inc.

Healwell AI has rapidly gained financial strength over the past few months with ground-breaking partnerships and organic growth as it goes into high-gear to be an AI-driven healthcare powerhouse. Shares of the Toronto-based physician-led company has been on a tear after Healwell AI presented its significant milestones and robust M+A pipeline at CEM’s AlphaNorth Capital Event in the Bahamas in January.

Impressed with its leadership pedigree, acquisition plans and a growing clinical database to diagnose diseases at an early stage, Healwell was ranked as a Top Pick by attendees at the conference.

Since getting the ‘Top Pick’ accolade when trading at C$0.75, Healwell AI shares have shot up 150% over a 3-month period.

How Healwell is bridging health and wealth with AI

As we all know, the first step to receiving proper medical care is getting the right diagnosis.

But the unfortunate fact is that most of us will be misdiagnosed during our lifetimes, states the Institute of Medicine.

Enter Artificial Intelligence, or AI.

Grounded in its ability to quickly analyze vast datasets like electronic medical records, lab results and X-rays, MRIs and CT scans, AI’s promise of enhanced medical diagnostics to better patient outcomes, is revolutionising healthcare across the world.

Given its rapid deployment, ‘AI in Healthcare’ has also become a hot investment theme with studies predicting this market segment will be worth $187 billion in 2030, which is an 800% gain from today.

“I think there's a lack of understanding at just how staggering the AI healthcare opportunity is,” says Dr. Alexander Dobranowski, CEO of Healwell AI Inc., whose presentation at the AlphaNorth Capital Event in Bahamas in January was a head-turner.

So, I invited Dr. Dobranowski to share with us Healwell’s opportunity. 

Tell us about your business?

“Healwell AI is an Artificial Intelligence company that's focused on preventative care primarily in early disease detection. That's at the core of our mission. And that's how our technology works. We effectively debuted six months ago on October 1, 2023. And we're a senior listed company on the Toronto Stock Exchange.

Over the last six months, we've had four investment banks initiate coverage and we have actually had some fairly significant momentum in the capital markets where we've had some liquidity trading between 250,000 to well over a million shares per day.  We raised over three financings since October 1 totaling $29.5 million in the Canadian capital markets. We are commercially active in Canada, US, Australia and New Zealand.

We have a trailing 12-month top line revenue of $20 million and we've done two acquisitions since we've effectively debuted. So, part of our strategy and focus is to continue to grow early disease detection capabilities organically and also grow through M&A activity.

“We have a very, very important partner, a strategic investment partner with a company called Well Health Technologies. This is also a senior listed company on the Toronto Stock Exchange and they're the largest healthcare conglomerate in Canada with a very large presence in the US. Well Health has been a strategic investor and our alliance agreement provides us exclusive access to the Well Health footprint of providers and clinical information.”

Why should I invest now? 

“We derive our data science and AI oriented revenue from six of the top 10 largest pharma companies in the world. And to be able to do that, you have to have a track record, demonstrate feasibility, compliance, etc.

We have this incredible investment partner Well Health Technologies. It is one of the largest healthcare companies in the world and we have an exclusive partnership with them. When you look at what's required to succeed in this sector from an AI perspective, you need this type of compliant access to a clinical footprint. And we have that.

We also have acquired Pentavere Research Group, one of Canada's leading AI companies. Its pedigree of published manuscripts is really important in health care because these publications provide peer-reviewed revolutionising evidence on the strength of the AI technology we work with and specific clinical use cases.

We're already commercially active in Canada, the US, Australia and New Zealand. So, we're not just an AI company that's focused on the Canadian market, but we're an AI company now from a global perspective, and we're looking to build our investor audience in the US.”

And what should I keep my eye on moving forward? 

“We have a very strong corporate development team and we've already done two material transactions. We have a very, very robust pipeline. The targets we have on hand will see us exceed over 40 million in top line revenue exiting this year. So that's doubling our top-line growth from where we are today. We're going to be making a number of announcements regarding some very exciting targets that we're working on which are focused specifically on AI, early disease detection, and also companies that are mature in healthcare software or research platforms. So those are the types of catalysts that are coming in within the medium term.”

As of December 31, 2023, Healwell had 17 services agreements in its development pipeline with pharma companies. In addition, the Company has services agreements with 7 hospitals and provincial health authorities in Canada, and 3 service agreements with US based healthcare systems.

Financial Highlights 2023

• $7.32 million – Healwell achieved annual revenue from continuing operations of $7.32 million in fiscal 2023.
• $19.16 million - As of December 31, 2023, Healwell had $19.16 million in cash, compared to $1.41 million as of December 31, 2022.
• $20 million - Since its relaunch in Q4 2023, the Company’s annual revenue run rate has more than doubled to over $20M with the largest component of revenues now coming from SaaS and services.
• $29.5 million - Healwell ended 2023 with a strong balance sheet, having secured approximately $29.5 million from convertible debt and equity financings.
• $40 million – Using the company’s existing cash on hand, Healwell estimates that its active acquisition and business development pipeline has the potential to more than double its yearly revenue run ratetop-line to over $40 million.

Looking ahead

• Healwell AI has signed services agreements with both WELL Health USA and U.S. based Circle Medical Technologies Inc., which expands its footprint in the U.S. and will enable U.S. healthcare providers with a suite of artificial intelligence (AI) powered preventative care solutions.
• Healwell’s Pentavere Research Group Inc. has partnered with WELL Health USA’s CRH Medical to access U.S. clinical data to gain insights in supporting patients who are dealing with Inflammatory Bowel Disease and other gastrointestinal conditions. Through the agreement, Pentavere’s DARWEN™ AI platform will analyze over 200,000 US patients, in a secure and compliant manner across 21 states to understand the real-world dynamics between biologic prescribing and treatment outcomes.
• Healwell’s Khure Health will integrate its proprietary AI platform with Circle Medical’s electronic medical record system, expanding its footprint to over 30 US states. Khure’s AI will screen for and flag individual patients whom the healthcare practitioner might consider for further investigation for potential earlier diagnosis of rare diseasesrun rate.

Our View

AI’s ability to predict and diagnose diseases at a faster rate than most medical professionals is revolutionizing healthcare.

It will also have a direct positive impact on the growing global AI in medical diagnostics market, which in terms of revenue was estimated to be worth $1.3 billion in 2023 and poised to reach $3.7 billion by 2028, according to a recent report by MarketsandMarkets.

Healwell's strong financial performance, active acquisition strategy, expanding commercial partnerships, positive financial outlook, and the broader industry trends suggest the company has excellent growth prospects in this sector.

The recent appointment of Hamed Shahbazi, Founder, Chairman and CEO of WELL Health Technologies as Healwell’s chairman also adds a dynamic leadership element to the company’s plans. Shahbazi has over 25 years of experience as a technology focused operator and executive and he has led WELL to become the leading digital healthcare companies in Canada with close to one billion dollars in annual revenue.

By bolstering its leadership group, doubling its revenue profile and increasing access to global patient data, Healwell is well-positioned to stand out in the AI Healthcare space.

The Investor Breakout Advantage

As you already know, our Investor Breakout newsletter is based on the top picks and performers at CEM’s conferences, which are held seven times a year. These invite-only conferences serve as the meeting ground for North America’s most influential investors and industry leading issuers that attend a day-long series of 1-1 meetings.

At the end of each event, after over 1,000 meetings have taken place, investors meet in the Breakout Exchange forum and identify their top picks.

Healwell was a top pick at CEM’s AlphaNorth Capital Event in the Bahamas in January. Since being picked at the Bahamas conference, Healwell AI shares have shot up 130% over a 3-month period.

“The healthcare AI space is inherently complex …I think there's a lack understanding at just how staggering the AI healthcare opportunity is…The CEM gathering in Bahamas has been helpful in giving us a strong platform to get in front of investors to do 1 on 1's, and group discussions to amplify our message.” - Dr. Alexander Dobranowski, Healwell’s CEO

Scottsdale Capital Event 2024

Mark your calendars and check your inboxes – The 11th annual Scottsdale Capital Event at the JW Marriott Phoenix Desert Ridge Resort, happening April 19-21.

The conference will introduce growth-stage companies (Resource, Technology, Biotech, Special Situations) to active top-level capital finance individuals through a day of scheduled 1:1 meetings and networking activities.

Warm Regards and Happy Investing,

Fabian Dawson