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BEACON EQUITY RESEARCH Analyst: Lisa Springer, CFA Initial Report September 4th, 2008 MLKNA daily

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Phone: (631) 342-8800 Fax: (631) 342-8819

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info@medlinkus.com www. medlinkus.com

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MedLink International Inc. 11 Oval Drive Suite 200B, Islandia, NY 11749

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Market Data Symbol / Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . OTC .. BB: MLKNA Current Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$1.45 Price Targe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3.00 . Rating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Speculative . . . . . . . . . . . . Buy Outstanding Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31.2M Market Cap. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44.2M Average 3M Volume. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,265

Company Introduction MedLink International Inc. (OTCBB: MLKNA) provides doctors, hospitals, medical imaging centers, labs and patients with software products and services for creating, managing and sharing critical medical information. This information is delivered via MedLink’s Virtual Private Network (VPN), which sets the industry standard for secure HIPAA compliant communications. The Company’s flagship product, MedLink TotalOffice EHR software, provides physicians with one solution to handle all practice management needs, from scheduling to medical billing, all in one user-friendly application. MedLink’s software and services are made available to both large and small healthcare institutions at an affordable price. MedLink is creating a digital backbone for the delivery of enhanced medical services through its integrated suite of networking, communications, management and financial products delivered via the MedLink VPN.

Please carefully read the risks and disclaimer section at the end of this report.


Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Its current product offerings include: MedLink TotalOffice EHR, a complete practice management, billing and health record solution for physician’s offices; MedLink TV, which delivers medical education, news and advertising via flat screen TVs in physicians’ waiting rooms; MyMedLinkChart, a complete personal health record for patients and their families; and MedLink Remote PACs, which allow imaging centers to quickly and efficiently deliver images and reports to the physician’s desktop. The Company markets its products and services through partnerships with medical societies, imaging centers and hospitals. In April 2008, MedLink announced an endorsement agreement with the Texas Medical Association, the nation’s largest state medical society. TMA will offer MedLink TV to its 32,000 physician members across Texas as a free benefit of their association membership. The Company also recently announced an endorsement and advertising agreement with St. Luke’s Cornwall Hospital, a clinical affiliate of The Mount Sinai Hospital and one of the mid-Hudson Valley’s premier health care providers. In addition, MedLink has partnered with Life Point Informatics, a leader in electronic ordering and delivery of lab results. More than 43,000 physicians use the Life Point system each month. This partnership will enable MedLink to expand its customer base and product line. During the second quarter of 2008, MedLink recorded its fourth consecutive quarter of growth. Second-quarter highlights include a strategic alliance with Microsoft HealthVault; endorsement by St. Luke’s Hospital in New York; sponsorship of its TotalOffice EHR product by Piedmont Medical Laboratory to its referring physician base; the retention of Shattuck Hammond Partners for investment banking and financial advisory services; rollout of MedLink TV in the Dallas metro market; and the Company’s application for 2008 CCHIT certification. CCHIT is a not-for-profit agency defining industry standards and the key functional components of EHRs (electronic health records). In the mid-1990s, MedLink was founded by three physicians; with the creation of its virtual private network (VPN), the company emerged as a healthcare information technology company in 2003. MedLink VPN allows physicians, imaging centers, hospitals and labs to communicate effectively while adhering to HIPAA privacy laws. The Company’s shares trade on the OTC Bulletin Board and on the Frankfurt Stock Exchange under the tickers (OTCBB: MLKNA) and (Frankfurt: WM6B.F), respectively.

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Investment Highlights MedLink addresses a $6.9 billion Healthcare Information Technology (HIT) market Americans spent more than $2.3 trillion on healthcare in 2007, and spending is forecast to reach $4.3 trillion by 2025. Information technology has emerged as one of the few tools that may help curb rising healthcare costs. A Rand Corp. study estimates widespread adoption of HIT could reduce healthcare costs by as much as 10%. HIT spending was estimated at $6.9 billion in 2007, and is expected to increase to $10.8 billion by 2012. MedLink thinks the HIT market could grow to $28 billion by 2014 as a result of “pay for performance” initiatives by Medicare and Medicaid. Pay for performance programs require compliance with new evidence-based guidelines and are more readily accomplished with an HIT system. Government initiatives drive HIT market growth Medical record-keeping is not yet fully automated. Large numbers of clinics have yet to convert paper to electronic records. While the federal government is leveraging its position as the nation’s leading purchaser of healthcare products and services to promote HIT use, experts estimate that only about 15% of the 600,000 physicians in the United States keep electronic records; the remaining 80% continue to rely on paper documents. To increase these numbers, Centers for Medicare and Medicaid Services (CMS) and the Office of the Inspector General (OIG) are allowing acute care organizations to assist referring physicians with hardware, software, training and the support necessary for implementing e-prescribing and interoperable electronic medical record systems. New legislation will drive EHR adoption by requiring Medicare physicians to embrace e-prescribing. Under the Medicare Electronic Medication and Safety Protection Act, physicians would receive financial incentives to use e-prescribing systems. Grants would help offset start-up costs and physicians who use the technology would receive up to a 2% bonus for every claim that includes an e-prescription and per-claim penalties for providers who don’t comply. The Bush administration has mandated physicians must switch all of their patient records to electronic form by 2014. MedLink has key partnerships and endorsements The Company recently announced an endorsement by the Texas Medical Association, the nation’s largest medical society, and has initiated a program with two other large medical societies by making its TotalOffice EHR product available to them at a member benefit price. MedLink has already been endorsed by the New York County Medical Society, the Bronx County Medical Society, the County of Queens Medical Society, and the Suffolk County Medical Society, among others. In addition, the Company is in discussions with numerous additional county societies and large state societies. MedLink recently entered into an agreement with Piedmont Medical Laboratory, whereby Piedmont will be offering MedLink TotalOffice EHR as the Piedmont-sponsored EHR practice management system to select affiliated medical practices. Piedmont will subsidize part of the cost of the system, thus enabling Piedmont to incorporate a powerful electronic ordering and results reporting tool into the care provider’s workflow. Users will be able to utilize the TotalOffice EHR E-labs tool to connect directly to Piedmont labs, facilitating complete automation of the lab ordering process from point-of-care to the physician’s office to the lab. The Company has Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

begun to realize sales from this physician base and is pursuing similar relationships with regional labs in New York, New Jersey and Michigan. In addition, MedLink has partnerships with Access Imaging and Lankmark Imaging in California, Doshi Imaging and Kodak & Medavis for medical imaging products and services, and with Dynatek Media for the launch of MedLink TV. Already deployed in 300 medical offices and viewed more than 300,000 times a month, MedLink TV is enjoying enormous success. The Texas Medical Association has commitments for 1,800 MedLink TV screens by year-end 2008, and MedLink TV programming has received endorsements from nearly a dozen medical societies. The Company added 4,400 physicians to its network through the 2007 acquisition of Anywhere MD, and has formed a partnership with Life Point Informatics in 2008 that provides access to a 43,000 physician network. Integration with HealthVault leverages MedLink’s competitive position MedLink is completing the integration of its MedLink EHR and MyMedLinkChart products with Microsoft’s Healthvault. As a result of this integration, consumers will be able to view, save and send clinical information from within their Healthvault account. With a push of a button, physicians will be able to send the entire patient record to HealthVault, a convenience that will strengthen the relationship between physician and patient. The integration of its products with HealthVault also enhances MedLink’s competitive position by driving patient demand to physicians, which will be driven through an aggressive marketing campaign on MedLink TV. Application for CCHIT certification MedLink applied for CCHIT certification in 2008. CCHIT is charged with defining key functional components of an EHR, including how it should communicate with other systems and how it should protect patient information. Of the more than 300 companies that claim to be EHR vendors, less than 3% have applied for CCHIT certification in 2008 due to the organization’s rigorous criteria. Increasingly stringent certification standards will likely shrink competition in the EHR market since many EHR buyers are already using CCHIT certification as a filtering mechanism. Some physician reimbursement programs and grants are already tied to CCHIT certification and many payer organization and healthcare information exchanges are also mandating CCHIT certification. MedLink anticipates demand for its TotalOffice EHR by small and mid-sized practices will increase dramatically following CCHIT certification since most physician practices can’t afford the high prices of other CCHIT-certified products.

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

4


Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Acquisition opportunities in consolidating HIT market The HIT market is highly fragmented, with about 60% of participants generating less than $10 million in annual revenues. MedLink has already completed one acquisition that added some 4,400 physicians to its network and is likely to make additional synergistic acquisitions as it continues to extend its customer base and service offerings. Strong management team with proven track record MedLink’s president/CEO, Ray Vuono, has more than 20 years experience as a corporate strategist and marketer for top-tier companies. He is also the CEO of private venture firm RayvonVC, and led the turnaround of a distressed company, National Support Systems, to profitability. Executive vice president/CFO Jameson Rose formerly served as vice president of finance for Ambassador Capital Group. Executive vice president of sales James Decker has more than 15 years senior sales experience with leading companies such as MCI and Telstar.

Business Model & Strategy MedLink intends to create and support a digital backbone for the delivery of enhanced medical services to healthcare professionals worldwide through its Virtual Private Network (VPN). The Company’s flagship TotalOffice EHR product offers an integrated suite of networking, communications, practice management, financial and other value-added solutions. By connecting healthcare professionals with vital information, MedLink’s VPN enhances efficiencies and ensures optimal, real-time delivery of patient information. Broad-based product portfolio The Company’s product portfolio includes MedLink TotalOffice EHR, MedLink TV, MyMedLinkChart and MedLink Remote PACs. Exhibit 1: Medline business model

Services

Products

MedLink To talOffice EHR Software • Integrates scheduling, patient registration, billing, document management, messaging, e-Prescribing and e-labs • Centralizes patient medical records and streamlines the diagnostic and treatment processes.

MyMedLinkChart • Creates and manages patients’personal health records.

MedLink TV • Provides patients with thought provoking, entertaining and informative healthcare related program.

MedLink remote PACs • Allows imaging center to quickly and efficiently deliver images & reports directly to the physician’s desktop.

MedLink Data Center • Provides storage and back up of patient records .

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

5


Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Strong and robust flagship product MedLink TotalOffice EHR, the Company’s flagship product, integrates scheduling, patient registration, billing, document management, messaging, encounter notes, e-prescribing and e-lab records into a single practical solution. This product centralizes medical records and ensures a streamlined treatment process and seamless management of patient information. MedLink TotalOffice EHR also allows physicians to better manage patient insurance and co-payment information and establish a simple workflow for generating and submitting accurate bills, thus dramatically reducing insurance company rejections. Exhibit 2: MedLink TotalOffice EHR

MedLink TotalOffice EHR

Scheduling • Color Coding - easy to track • Integrated with patient records • Integrates multiple physicians at multiple locations • Ability to set physicians schedule

Patient Registration and Demographics • All demographic information • Scanned pertinent documents • Create insurance information • Create contact list

Patient Chart • Patient Histor y • Records of visits and complaints • Allergies and alerts • Immunization records • History of laboratory results • Care plans for chronic illness

Billing • Single interface for managing claims from beginning to end • Receivable manage ment for optimal recover y • Complete integration with HER • Complete tracking and reporting tools

Others • Fully integrated document management • Quick prescription creation • Convenient management of patient laboratory reports • HIPPA compliant communication • All records backed in secure data facility

Source: Company reports

Client training and data security The Company provides continuing education and on-site training for its healthcare professional customers, creating a roadmap for practices that helps them achieve their goals regarding electronic health records, e-prescribing, document management and HIPAA compliance while ensuring normal workflow. Information flow takes place over a secure virtual private network using SSL technology to create a VPN tunnel over the public internet that ensures data security. The MedLink VPN utilizes communication over the HTTP protocol and is compatible with virtually every other network environment. The cost benefits associated with the MedLink TotalOffice EHR are numerous and include the following: • Minimize record keeping and storage costs; • Reduce staffing required to support medical record activities; • Reduce spending on supplies, courier services and physical space; • Improve reimbursement via access to detailed documentation and a complete medical record; • Accelerate cash recovery via faster access to medical records and better AR tools; • Reduce HIPAA compliance costs; • Minimize order entry and report handling costs; Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

• Eliminate inaccurate insurance information and test codes; and • Collect information required for secondary and tertiary insurance coverage and provide easy tools for cross-over and re-bill. The Company’s existing data center, located in Atlantic Telecom Center’s 750,000-square-foot facility in New York, offers state-of-the-art facilities and connectivity to multiple major fiber providers, including Verizon, AT&T, MFN, WorldCom, Williams, ConEd Communications and Telergy. MedLink has selected Vastnet’s Melville collocation facility on Long Island as the site for a second data center which will provide ample storage for the medical records of MedLink’s growing customer base. MedLink TV MedLink TV is a private medical communication network, through which healthcare content and information are delivered right to the physician’s waiting room and displayed on a 40” or 32’’ flat screen TV. The Company created MedLink TV as a product that medical societies could offer free to their members, providing tangible membership benefits while creating a direct link for disseminating information to members. The service is available at no cost to members of endorsing medical societies. The benefits physicians realize by entertaining their waiting room patients with MedLink TV include a 50% perceived reduction in wait time. Other benefits physicians enjoy include: • • • • • •

Control content and deliver positive message; Increase revenues by marketing specific services; Inform patients of office hours and policies; Direct patients to practice Web site; Encourage communication with patient; and Increase practice value.

There are currently more than 300 MedLink TVs installed, and viewership exceeds 300,000 per month. Since the launch of MedLink TV in Texas in early May 2008, the Company has averaged nearly 100 install agreements per week in Texas alone. The Texas Medical Association has committed to 1,800 screens by year-end 2008. Based on these and other commitments, MedLink estimates its TV network will have 3.5 million unique viewers per month by year-end 2008 and will rival some of the smaller cable channels, while having the added advantage of a highly valuable advertising demographic. MedLink recently signed a representation agreement with SeeSaw Networks, the nation’s largest digital signage advertising agency, and has begun to attract national advertisers. The Company expects to capitalize on significant advertising revenues in the third quarter of 2008 and beyond. By year-end 2008, MedLink expects to have 2,000 screens generating advertising revenues of as much as $1.0 million per month.

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

MedLink Remote PACs MedLink’s Remote PACs solution allows imaging centers to quickly and efficiently deliver images and reports directly to the physician’s desktop. The MedLink VPN allows for secure communication, while MedLink TotalOffice EHR provides the vehicle for viewing images and reports. The client delivery component of the system runs as a service on the physician’s desktop or local server where it continuously polls for new files. Downloads of files run 24/7, but bandwidth and processing time are constantly adjusted so as not to interfere with other processes on the desktop or server. Images may be viewed using the MedLink DICOM viewer or any third party viewer. In addition, imaging centers can choose to allow physicians to request appointments and enter orders, thus automating the pre-authorization process. MedLink Remote PACs have been installed in more than 50 radiology centers across New York, New Jersey and Florida. The Company is pursuing agreements with additional radiology centers in the United States and expects to have more than 200 radiology centers utilizing a “Lite” version of MedLink TotalOffice EHR to deliver radiology reports and images to physicians. At present, the referring physician base that can utilize the TotalOffice EHR lite version for radiology reports, images and lab tests is estimated at more than 80,000, or nearly 20% of all U.S.-based physicians. Lite version users will be encouraged to upgrade to the full TotalOffice EHR version, which includes billing, practice management, document management and other functionalities. MyMedLinkChart.com MedLink’s product for creating personal health records, MyMedLinkChart, encourages the sharing of information between physician and patient. More than just static repositories of patient data, these personal health records combine data, knowledge and software tools which help patients become active participants in their own care. When personal health records are integrated with physician electronic health records, greater benefits are realized. For example, quality of care improves since patient information is readily available to the physician at the point of care. The U.S. Department of Health and Human Services encourages the use of personal health records. Both the American College of Physicians and the American Academy of Family Physicians have called for a collaborative effort to bring patient health records, electronic medical records and other technologies together to support an ongoing physician-patient relationship. The integration of MyMedLinkChart with Microsoft’s HealthVault will enable consumers to view, save and send clinical information from within their HealthVault account, thus improving coordination of care. Healthcare organizations will be able to leverage Healthvault to strengthen the relationship between physician and patient. With a push of a button, physicians will be able to send the complete patient record to HealthVault. In addition, integrating its product with HealthVault enhances MedLink’s competitive advantage by driving patient demand to physicians, which will be supported by an aggressive advertising campaign on MedLink TV. Business strategy for rapidly gain market share The Company plans to grow by expanding its suite of innovative software products and services, making acquisitions and forming additional strategic alliances and partnerships.

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Exhibit 3: Business strategy Developing innovative products and services

Endorsement agreement with medical societies- signed agreement with Texas Medical Association and other large medical associations.

Acquisitions and Strategic AlliancesPartnership with Life Point Informatics and Piedmont Medical Labs Acquisition of Anywhere MD

Customers- includes small and medium sized hospitals and physician practices.

Source: Beacon Equity Research

Consistent with this strategy, the Company is forging strategic alliances with several major industry players. For example, MedLink has partnered with Life Point Informatics, a provider of Web-based order-entry and lab result reporting solutions. The companies have completed the integration of LifePoint’s LabTest system with MedLink’s TotalOffice EHR. This integration will enable laboratories to offer physicians their own EMR and HER-enabled practice management system. Through a partnership agreement with Piedmont Medical Laboratories, TotalOffice EHR will be made available to affiliated physicians on a shared cost basis. Physicians can utilize TotalOffice EHR to connect directly to Piedmont labs and completely automate the lab ordering process. The Company has already begun to realize revenues from this arrangement and is pursuing similar agreements with regional labs in Texas, New Jersey and Michigan. In 2007, MedLink acquired Anywhere MD, a provider of technology products for improving healthcare provider productivity. Anywhere MD’s main expertise is in clinical documentation tools for physicians. It offers a broad range of products for managing patient information more efficiently, as well as proprietary software for physician mobile handheld devices. In addition to extending MedLink’s product line with Anywhere MD’s AutoDoc, this acquisition brought 4,400 new physicians to the MedLink network. As a part of its marketing strategy for MedLink TV, the Company is pursuing endorsements from leading medical societies. MedLink has been endorsed by the Texas Medical Association, the New York County Medical Society, the Bronx County Medical Society and many other county and state medical associations. In June 2008, MedLink secured an endorsement from and signed an advertising agreement with St. Luke’s Cornwall Hospital, part of the Mount Sinai Hospital network and one of the mid-Hudson Valley’s premier healthcare providers. Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Healthcare Information Technology (HIT) Market MedLink participates in the Healthcare Information Technology (HIT) market. The cost and efficiency benefits associated with automating patient records are driving robust growth in healthcare IT spending. Exhibit 4: Healthcare IT growth drivers

Government Spending

Growing demand for healthcare services

Efficiency and Cost Savings

Healthcare IT Growth Divers

Source: Beacon Equity Research

Growing healthcare spending According to the U.S. Congressional Budget Office, total national spending on healthcare has more than doubled as a share of gross domestic product (GDP) in the last 30 years. The Budget Office estimates that share will double again by 2035, with medical spending accounting for some 30% of GDP. Federal spending on Medicare and Medicaid, currently at 4% of GDP, is forecast to rise to 9% by 2035.

2017E

2016E

2015E

2014E

2013E

2011E

2012E

2010E

0%

2009E

0.0 2007

2%

2008E

0.9

2006

4%

2005

1.8

2004

6%

2003

2.7

2002

8%

2001

3.6

2000

10%

1999

4.5

%Growth

$ Trillion

Exhibit 5: NHE estimates of healthcare spending ($ trillion)

Source: Center for Medicare and Medicaid services

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

10


Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Ageing population drives demand for healthcare services An aging U.S. population is likely to fuel continued increases in healthcare spending. In addition, healthcare spending is relatively immune to economic cycles and thus presents steady growth opportunities for healthcare providers and HIT companies. Exhibit 7: Average annual healthcare costs for Medicare enrollees by age group

Exhibit 6: Projections of age demographics in the U.S.

25,000

100

20,000 In Dollars

Millions

75

15,000

50

10,000

25

5,000 0

1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2006 2010 2020 2030 2040 2050

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

0

Projected 85 & Over

65 & Over

65-74

65 and Over

75-84

85 and Over

Source: US Census Bureau, Decennial Census, Population Estimates and Projections

An aging population should also increase the volume of lab tests performed, creating an expanding market for MedLink’s Remote PACs solution.

Relative Number of lab Tests per year

Exhibit 8: Relative number of lab tests performed in 1997-2007. Patient Age

15 12 9 6 3 0 Under 18 years

18-44 years

45-54 years

1997

55-64 years

65-74 years

75 years and older

2007

Source: US Census Bureau, Decennial Census, Population Estimates and Projections Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

11


Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Demand for more cost-effective solutions With healthcare costs spiraling out of control, insurance companies, government agencies and other payers are demanding new healthcare IT solutions that can improve efficiencies and better control costs. The Centers for Medicare and Medicaid Services (CMS) and other payers have begun to link medical care payments with quality and safety through so-called “pay for performance” approaches. Some pay for performance plans offer additional reimbursement for healthcare providers who demonstrate high levels of quality and safety. CMS recently changed its rules so that there will be instances where providers are not paid for treatment of conditions acquired in hospital where the condition is deemed reasonably preventable through the application of evidencebased guidelines. This policy change, effective October 2008, is positive for the HIT industry since compliance with evidence-based guidelines is easier to prove for organizations with HIT systems. Exhibit 9: Sources of growth in projected federal spending on Medicare and Medicaid (Percentage of GDP) 20

15

10

Effect of Cost Growth Faster than GDP and Aging of Population Effect of Aging of Population

5

0 2007

2022

2037

2052

2067

2082

Source: Congressional Budget Office, November 2007

$28 billion healthcare IT market HIT spending was estimated at $6.9 billion in 2007 and is expected to increase to $10.8 billion by 2012. MedLink thinks the HIT market opportunity could grow to $28 billion by 2014 as a result of “pay for performance” initiatives by Medicare and Medicaid and other payers. Revenue management and clinical operations are the two primary areas of HIT spending.

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

12


Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Exhibit 10: Healthcare IT market 2,500 Other

$ Billion

2,000

Administration Costs Lab Testing Nursing Home & Home Health

1,500

Prescription Drugs Physician Services

1,000

Revenue cycle market opportunity~$18bn Clinical cycle market opportunity~$9bn

500 Hospital Care

0

Source: Athena, LabCorp Presentations

HIT industry consolidation The HIT market is highly fragmented, with some 60% of industry participants generating revenues of less than $10 million per year. A few stronger players are likely to emerge over time and drive consolidation within the market over the next several years. With endorsements from leading medical societies and brand awareness created through its healthcare television network, we think Medlink is well-positioned to emerge as an industry leader.

Exhibit 11: Profile of the HIT market 8.0% 8.0%

22.0%

6.0% 8.0% 24.0%

10.0% 14.0%

<$2 Million $2-$5 Million $5-$10 Million $10-$20 Million $20-$50 Million $50-$100 Million $100-$500 Million Over $500 Million

Source: QuadraMed Presentation

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

13


Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Government initiatives spur demand The HIT industry is not fully automated; a large number of clinical centers still rely on paper records. At yearend 2007, only about 15% of the 600,000 physicians nationwide had converted entirely to electronic records. MedLink expects recent legislation to further drive EHR adoption by requiring physicians to embrace electronic prescribing. Under the Medicare Electronic Medication and Safety Protection Act, physicians would receive financial incentives to use e-prescribing systems. Grants would help offset start-up costs, and physicians who utilize the technology would receive up to a 2% bonus for every claim that includes an e-prescription and perclaim penalties for providers who don’t comply. The Bush administration has mandated the conversion of all patient records to electronic form by 2014. This translates into a potential $28 billion market opportunity, according to MedLink. HIT spending was estimated at $6.9 billion in 2007 and is forecast to reach $10.8 billion within four years.

Competitive Analysis Many small companies, as well as divisions of large software companies, compete in the healthcare IT space. Several of MedLInk’s competitors are described below. MedLink’s competive advantages include a more affordable price for its software. The Company is able to offer TotalOffice EHR at a lower price than competitor products because of lower development costs, the result of developing all of its software in-house. A lower purchase price for MedLink sotware allows for greater scope of implementation through government grants and a superior ROI for pharmaceutical, radiology and laboratory product sponsonships. In addition, MedLink’s software is designed around the latest technology platforms, providing for a simpler user interface, faster and easier implementation, seamless integration and an acclerated ROI for physiican practices. Leading state and medical associations recognize the product’s advantages and are endorsing the MedLink product. Cerner Corporation Cerner Corporation is one of the leading suppliers of healthcare information technology solutions, healthcare devices and related services. Cerner’s clients include single-doctor practices, hospitals, corporations and government agencies. Software solutions are designed around its proprietary Cerner Millennium architecture. This customized solution framework combines clinical, financial and management information tools. Eclipsys Corporation Eclipsys Corporation is a provider of advanced integrated medical access management software and other professional services to healthcare organizations. The company is a pan-American supplier of medical softwares and has offices in the United States and India. Eclipsys develops and licenses medical software that enables physicians, nurses and others to place orders and access/share information about patients. The software also facilitates patient hospital admissions, appointment scheduling, records maintenance, invoicing, inventory control, cost accounting, and assessing the profitability of specific medical procedures and personnel. Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Allscripts Healthcare Solutions Inc. Allscripts Healthcare Solutions Inc. is a provider of clinical software, connectivity and information solutions that are used by physicians to improve the quality of healthcare. The companyâ&#x20AC;&#x2122;s clients include more than 40,000 physicians in 4,000 clinics and 700 hospitals across the United States. Allscripts operates through three business segments: software and related services, information services and prepackaged medications. Streamline Health Solutions Inc. Streamline Health Solutions Inc. is a healthcare information technology provider that develops and licenses software for physicians, nurses and other healthcare professionals. It is one of the leading healthcare IT players in the U.S. market with products that assist medical professionals in automating daily workflow and accessing information quickly. Mediware Information Systems Inc. Mediware Information Systems Inc. develops, markets, licenses, implements and supports clinical management information software. The companyâ&#x20AC;&#x2122;s software products address the unique requirements of hospital medication management, blood bank and surgical suites. Aspyra Inc. Aspyra Inc. is a healthcare information technology and service provider, specializing in clinical information systems and diagnostic information systems. Its product offerings include laboratory, anatomic and radiology information systems, picture archiving communication systems and clinical image management systems. athenahealth Inc. athenahealth Inc. provides Internet-based business services for physician practices. The company is a leading revenue cycle management solution provider. It has integrated its services into three components: Internetbased software, updated database of payer reimbursement process rules and back-office services which include administration, billing and clinical data management. Computer Program & Systems Inc. Computer Program & System Inc. is a provider of integrated healthcare information technology solutions. This company designs, develops, markets, installs and supports computerized IT systems that address the needs of small and mid-sized hospitals. The company provides medical information systems and services that collect, process, retain and report data across all the primary functional areas of the hospital. Medavant Healthcare Solutions Medavant Healthcare Solutions (formerly known as Proxymed Inc.) is an information technology company that facilitates the exchange of medical claim and clinical information among doctors, hospitals, medical laboratories and insurance companies. It also enables electronic transmission of laboratory results. Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

MedcomSoft Inc. MedcomSoft Inc. develops and distributes healthcare IT software solutions in the United States and Canada. The company provides essential tools for automated medication management, including hospital pharmacy, blood bank and surgical units. It helps hospitals connect with pharmacies, laboratories, medical suppliers and insurance providers. Quadramed Corporation Quadramed Corporation is an industry leader in developing information technology solutions for hospitals and other healthcare organizations. It provides software solutions for clinical management, patient information management, revenue cycle management and health information management.

Financial Analysis MedLink generated revenues of $280,022 in 2007 from sales of MedLink TotalOffice EHR and other products. Operating expenses increased 180% in 2007 to $2,798,098 from $1,539,094 in the prior year, mainly due to the opening of an IT development center in India, the hiring of sales and customer support personnel, and increased marketing spending. MedLink’s net losses rose to $2,462,829 in 2007 from $1,539,094 in 2006 due to higher operating expenses and R&D expenditure. Exhibit 13: Selected income statement data

All figures in $ Revenue To tal operating expenses (excluding loss on impairment of assets) Operating income/(loss) (excluding loss on impairment of assets) Net income /(loss) (excluding loss on impairment of assets)

Year ending Year ending December 2007 December 2006

Six months ending

June 2008

Six months ending

June 2007

280,022 2,798,098

11 ,364 1,550,458

268,51 9 1,455,644

69,397 1,073,349

(2,518,886)

(1,539,094)

(1,209,568)

(1,036,330)

(2,462,829)

(1,539,094)

(1,209,568)

(1,036,330)

Source: Company 10-K and 10-Q

The second quarter of 2008 marked MedLink’s fourth consecutive quarter of revenue growth. Revenues for the first six months of 2008 increased 287% year-over-year to $268,519 from $69,297 in the 2007 six month period, reflecting sales of MedLink EHR, Anywhere MD’s AutoDoc and integration income from radiology centers. Operating expenses for the first six months of 2008 increased 36% year-over-year to $1,455,644 from $1,073,349; net losses widened to $1,209,568 in the first six months of 2008 from $1,036,330 in the first six months of 2007 as a result of increased staffing and infrastructure commitments, research and development spending related to MedLink EHR, and stock-based compensation agreements with the Company’s key executives. R Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Liquidity and capital requirements As of June 30, 2008, the Company had a working capital deficit of $639,837. While management believes revenues generated from product sales and MedLink TV advertising will be sufficient to fund its operations in the second half of 2008, there is no guarantee that this will be the case. MedLink may be required to seek outside financing to fund its 2008/2009 business plan. In August 2008, MedLink contracted with Shattuck Hammond Partners, a leading investment bank focused on healthcare services companies, to act as its exclusive financial advisor and investment banker. Shattuck Hammond Partners, a division of Morgan Keegan, has played a prominent role in financial transactions totaling more than $37 billion. Exhibit 14: Selected balance sheet data

All figures in $ Cash & cash equivalents Net working capital (excluding cash) To tal assets To tal long term liabilities To tal current liabilities Stockholdersâ&#x20AC;&#x2122; equity (deficit )

Year ending Second quarter December 2007 ending June 2008

2,762 (1,551,170) 1,210,394 2,750 1,655,426 (477,782)

0 (1,197,920) 1,229,209 2,750 1,869,046 (642,587)

Source: Company 10-K and 10-Q

Revenue outlook We think MedLink is well-positioned to achieve robust future sales of its TotalOffice EHR product as a result of increased market demand and the productâ&#x20AC;&#x2122;s competitive advantages. Demand for HIT systems is projected to rise significantly over the next six years as government payer organization mandate adoption of EHR through financial incentives and per-claim penalties for non-adopters. Compared to competitor products, MedLink offers a more cost-effective, affordable EHR solution for physician practices. Its products have already garnered endorsements from leading state and county medical associations. We also anticipate a strong, steadily increasing revenue contribution from MedLink TV advertising revenues. The Company is averaging nearly 100 MedLink TV install agreements per week currently, and expects to have an installed base of 2,000 screens by year-end 2008 generating advertising revenues approaching $1.0 million per month. Based on our discussions with management, we estimate 2008 revenues at approximately $2.0 million, consisting mainly of TotalOffice EHR sales and a sizable revenue contribution from MedLink TV advertising revenues. We think the Company will gain significant sales traction in 2009 after it secures CCHIT certification since many payer groups are likely to use CCHIT certification as a tool for screening HIT suppliers. Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

We expect MedLink’s software sales to triple in 2009 to a $6.0 million range and anticipate advertising revenues from MedLink TV exceeding $12 million. Software sales momentum should continue to build in 2010\2011 as the 2014 deadline approaches for industry-wide adoption of EHR technology. We estimate MedLink’s revenues will double again in 2010 to a $32 million range and look for 50% growth and sales approaching $48 million in 2011.

70

Projected Revenues $ in millions

60 50 40 30 20 10 0 Year

2008E

2009E

2010E

2011E

2012E

MedLink plans to significantly ramp up sales and marketing spending over the next two years to capitalize on the window of opportunity for TotalOffice EHR sales and support the rollout of its MedLink TV platform, so we

Valuation Analysis don’t anticipate the Company will turn profitable until 2010 despite high gross margins on software sales. MedLink is a small player in comparison to its competitors. The Company has a current market capitalization of approximately $44 million. Cerner Corporation is the largest of the peer companies and has a $3.6 billion market capitalization and Streamline Healthcare Solutions is the smallest, with a $15 million market capitalization. The HIT industry peer group was recently trading at a 2.5 times Price/Sales multiple and a 2.0 times forward Price/Sales multiple. We think MedLink warrants a higher valuation than its peers due to the cost advantages of its product, its endorsement and relationships with leading state and county medical associations and the significant advertising revenue opportunities associated with MedLink TV. As a result, we value MedLink at a 3.0 times forward Price/Sales multiple. Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Exhibit 15: Valuation Company Name 7/01/2008 Cerner Corporation Eclipsys Corporation Allscripts Healthcare Solutions Inc. Streamline Health Solutions Inc. Mediware Information Systems Inc. Aspyra Inc. athenahealth Inc. Computer Program & Systems Inc. Medavant Healthcare Solutions MedcomSoft Inc. Quadramed Corporation Peer Average

T Ticker icker Share Market. Cap. Symbol Price Price $ Million Symbol CERN ECL P MDRX STRM MEDW AP Y ATHN CPSI PILL MSF QD

$45.43 $17.99 $12.16 $1.63 $5.78 $0.70 $27.13 $17.45 $0.30 $0. 11 $9.97

3,660.18 977.95 693.79 15.09 43.98 8.71 878.01 Symbol 188.94 4.13 8.99 89.42

2008 21.99 17.31 22.62 N/A N/A N/A 69.64 Price 14.73 N/A N/A 33.23 29.92

P/E 2009 18.38 19.93 16.41 N/A N/A N/A 36.42 12.88 N/A N/A 22.16 21.03

2010 15.85 18.94 13.66 N/A N/A N/A 30.14 N/A N/A N/A N/A 19.65

2008 2.20 1.87 2.09 N/A N/A N/A 6.53 1.66 N/A N/A 0.61 2.49

P/S 2009 1.98 1.68 1.69 N/A N/A N/A 4.86 1.55 N/A N/A 0.56 2.05

2010 1.80 1.53 1.58 N/A N/A N/A 3.45 N/A N/A N/A N/A 2.09

Source: Reuters

We multiply a 3.0 times forward Price/Sales multiple by our $32 million 2010 revenue estimate to derive our $3.00 price target for MedLink shares. We are thus initiating coverage of MedLink International Inc. with a Speculative Buy rating and a $3.00 target price. Although we think MedLink shares offer strong appreciation potential, we encourage investors to carefully consider the many risk factors involved in this investment. MedLink has yet to generate meaningful sales and must compete in a fairly crowded marketplace for HIT products. Several of its competitors have larger R&D departments, greater sales and marketing budgets and better access to expansion capital. Additional risk factors are discussed in the next section.

Risk Factors Healthcare industry is highly regulated The healthcare industry is highly regulated by local, state and federal government agencies. Failure of the Company’s customers to comply with applicable laws and regulations regarding reimbursement and patient privacy could have a material, adverse effect on MedLink’s business. Business model depends on sales of products and services Healthcare IT software continues to evolve. The possibility exists that one of the Company’s competitors may develop superior or lower cost software, thus making MedLink’s offerings less attractive. If the Company fails to recognize and adapt to evolving technologies or industry standards, its business could suffer. In addition, MedLink is required to make significant ongoing investments in research and development to maintain its competitive edge. Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Dependence on strategic partnerships The Company relies on strategic partnerships and endorsements from medical societies to drive brand recognition and product sales. If any of these partnerships fail, or the Company loses a major medical society endorsement, MedLink’s sales and market share could suffer. History of operating and net losses MedLink has a history of operating and net losses which makes assessing its business strategy difficult. The Company also has negative working capital and a stockholder’s equity deficit. If sales fail to materialize quickly, MedLink will likely be required to seek outside financing to fund its 2008/2009 business operations. Dependent on healthcare IT market growth While the healthcare IT market is expected to grow rapidly, this market is still in an early development stage. New products and services are continually introduced but demand and market acceptance of many products and services is still evolving. Slower-than-expected market growth could adversely impact MedLink’s business. Interruption due to uncontrollable reasons The Company relies on third-party providers for the delivery of its communications and information services. Service could be interrupted because of a power or telecommunications system failure, software and hardware errors, computer viruses, fire, flood and other natural disasters. Prolonged service interruptions would adversely impact MedLink’s reputation and revenues.

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Management Ray Vuono

Ray Vuono has more than 20 years experience as a corporate strategist and marketer in the insurance, pharmaceutical and financial sectors. Mr. Vuono has served as the Company’s president/CEO since 2004 and as a consultant to the Company since 2001. Prior to joining MedLink, he served as CEO of RayvonVC, a private venture capital firm. His expertise in turnarounds is demonstrated by his accomplishments as president/CEO of National Support Systems, where he led a distressed company to profitability through brand revitalization. He holds a Bachelor of Science in economics from the University of Calgary and played football for the national champion University of Calgary Dinosaurs.

Jameson Rose

Jameson Rose became the Company’s CFO in 2004 and has served MedLink in various capacities since 2001. Prior to joining MedLink, Mr. Rose served as vice president of finance for Ambassador Capital Group and as an independent consultant in various investment banking transactions. Mr. Rose holds a Bachelor of Science with honors in economics from Staffordshire University in the UK.

Chief Executive Officer& President

Chief Financial Officer & Executive Vice-President-

James Decker

Executive Vice-President of Sales and Business Development

James Decker has more than 15 years of marketing, sales and general management experience in the telecommunication and software development market and has been employed by leading industry players such as MCI and Telstar. Mr. Decker is responsible for overall leadership of MedLink’s sales and service organizations, delivering profits and providing best-in-class service for the Company’s customers. Prior to joining MedLink, Mr. Decker co-founded and served as president of Hudson Street Network. Mr. Decker holds a Bachelor of Arts in marketing from Hofstra University.

Please carefully read the risks and disclaimer section at the end of this report.

MedLink International Inc. (OTC BB: MLKNA)

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Analyst: Lisa Springer, CFA Initial Report September 4th, 2008

Disclaimer DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. The information contained in our report should be viewed as commercial advertisement and is not intended to be investment advice. The report is not provided to any particular individual with a view toward their individual circumstances. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them. Our newsletter and website have been prepared for informational purposes only and are not intended to be used as a complete source of information on any particular company. An individual should never invest in the securities of any of the companies profiled based solely on information contained in our report. Individuals should assume that all information contained in the report about profiled companies is not trustworthy unless verified by their own independent research. Any individual who chooses to invest in any securities should do so with caution. Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested. Always research your own investments and consult with a registered investment advisor or licensed stock broker before investing. The report is a service of BlueWave Advisors, LLC, a financial public relations firm that has been compensated by the companies profiled. All direct and third party compensation received has been disclosed within each individual profile in accordance with section 17(b) of the Securities Act of 1933. This compensation constitutes a conflict of interest as to our ability to remain objective in our communication regarding the profiled companies. BlueWave Advisors, LLC, and/or its affiliated will hold, buy, and sell securities in the companies profiled. When compensated in shares, all readers should be aware that is our policy to liquidate all shares immediately. We reserve the right to buy or sell the shares of any the companies mentioned in any materials we produce at any time. This compensation constitutes a conflict of interest as to our ability to remain objective in our communication regarding the profiled companies. BeaconEquity.com is a Web site wholly-owned by BlueWave Advisors, LLC. BlueWave Advisors, LLC has been compensated seven thousand five hundred dollars from Coast 2 Coast Investments Inc., a shareholder of MLKNA, as a marketing budget to manage a comprehensive investor awareness program including the creation and distribution of this report as well as other investor relations efforts. Information contained in our report will contain “forward looking statements” as defined under Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Subscribers are cautioned not to place undue reliance upon these forward looking statements. These forward looking statements are subject to a number of known and unknown risks and uncertainties outside of our control that could cause actual operations or results to differ materially from those anticipated. Factors that could affect performance include, but are not limited to, those factors that are discussed in each profiled company’s most recent reports or registration statements filed with the SEC. You should consider these factors in evaluating the forward looking statements included in the report and not place undue reliance upon such statements. We are committed to providing factual information on the companies that are profiled. However, we do not provide any assurance as to the accuracy or completeness of the information provided, including information regarding a profiled company’s plans or ability to effect any planned or proposed actions. We have no first-hand knowledge of any profiled company’s operations and therefore cannot comment on their capabilities, intent, resources, nor experience and we make no attempt to do so. Statistical information, dollar amounts, and market size data was provided by the subject company and related sources which we believe to be reliable. To the fullest extent of the law, we will not be liable to any person or entity for the quality, accuracy, completeness, reliability, or timeliness of the information provided in the report, or for any direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information we provide to any person or entity (including, but not limited to, lost profits, loss of opportunities, trading losses, and damages that may result from any inaccuracy or incompleteness of this information). We encourage you to invest carefully and read investment information available at the websites of the SEC at http://www.sec.gov and FINRA at http:// www.finra.org.

All decisions are made solely by the analyst and independent of outside parties or influence. I, Lisa Springer, CFA, the author of this report, certify that the material and views presented herein represent my personal opinion regarding the content and securities included in this report. In no way has my opinion been influenced by outside parties, nor has my compensation been either directly or indirectly tied to the performance of any security listed. I certify that I do not currently own, nor will own and shares or securities in any of the companies featured in this report. Lisa Springer, MBA, CFA - Senior Analyst Lisa serves Beacon Research Partners as a research analyst. She brings to the company over 15 years experience in equity research and investment marketing. Prior to joining Beacon, Lisa worked as an equity analyst for an independent research provider. She has also held positions as investor relations officer for a NYSE-listed company and director of financial analysis for a large consulting firm. Lisa earned an MBA from the University of Chicago and is a Chartered Financial Analyst (CFA).

MedLink International Inc. (OTC BB: MLKNA)

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MedLink International Inc.