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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