On May 31st, CRH Medical graduated to the TSX. After building its initial revenue out with a skeleton crew, Vancouver’s CRH Medical (TSX:CRH) has added some muscle to its sales efforts.
CRH today announced it had signed a deal with Magellan Medical Technology to market the company’s CRH O’Regan System, a treatment for hemorrhoids.
Founded in 1996, Minneapolis-based Magellan has formed valuable relationships with medical giants such as Cardinal Health, Johnson & Johnson and Allergan. CRH says Magellan will lend its expertise in clinical sales support, strategic planning, and sales strategies.
The O’Regan system is a single use, disposable, hemorrhoid treatment that has proven safe and highly effective in treating hemorrhoid grades one through four, which is the most severe. The company sells its patented rubber band ligation technology as part of a turnkey package that includes marketing expertise and a referral program for gastroenterologists.
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“We believe it’s the right time to leverage the capabilities of an organization such as Magellan to increase revenues and grow market share for the O’Regan System,” said Edward Wright,CRH’s CEO. “Over the past several quarters, we have significantly raised awareness about the safety and efficacy of the O’Regan System, which has resulted in a loyal and growing customer base. We have been able to grow revenues from zero to a current annual run rate of approximately $7.0 million, all without a field sales and marketing team. We anticipate that the launch of this program will ultimately help us increase revenue from our current customers, as well as garner additional customers. We expect net income to remain strong during the introduction of this program, even though we will increase our expenses over the next several quarters as we invest in this and other long term initiatives.”
CRH was formed in 2000, but kicked into gear in 2006 which it began to market in the US. Co-founder Tony Holler and CFO Richard Bear were no strangers to success, having just sold groundbreaking flu-vaccine maker ID Biomedical to GlaxoSmithKline for $1.7 billion. After luring retail expert Edward Wright from Cartier, the company rejigged its marketing strategy, moving away from a capital intensive retail clinic model towards a strategy in which the company sold through gastroenterologists. This shift proved to be a boon to both top and bottom lines; in fiscal 2011, the company earned $1.19-million on revenues of $5.53-million, up 52% from 2010. CRH says that, as of December 31, 201, it had trained 1,054 physicians to use the O’Regan System.
Shares of CRH Medical closed today even at $.47 cents.