OxySure (OTCQB: OXYS) Delivers Medically Pure Oxygen to $7 Billion Market
LIGHTNING RELEASES: FRISCO, Texas (3/19/2014)- On October 21, 2010, Brody Justice, a healthy 17-year-old high-school athlete, collapsed during a baseball practice in Wakeland High School in Frisco, Texas.
“Next thing I know I’m hyperventilating,” the teenager recounted to ABC affiliate, WFAA Channel 8, “And that’s the last thing I remember before waking up in a cold tub and having the oxygen mask on my face.”
Unlike like many other children who do not have quick access to medically pure oxygen, Justice went on to make a full recovery.
The oxygen that saved Justice came from a $349 device manufactured by OxySure Systems (OXYS). Months earlier the Frisco School Board has purchased 110 of these portable life-saving units.
OxySure has developed an innovative technology: medically pure oxygen is created instantly from two dry, inert powders, allowing oxygen to be delivered on demand. OxySure owns a robust portfolio of patents, promoting a long-term competitive advantage.
Sales of the OxySure Model 615 increased 10-fold in 2013 from the previous year to $1.6 million. OxySure is targeting an end market estimated to be ten times larger than the market for Automated External Defibrillators (AED) — which has already sold 2 million units in the U.S. alone. The OxySure Model 615 is one quarter the cost of an AED and 300 times more likely to be used.
The Model 615 requires no training. There are no compressed tanks, no valves, no regulatory maintenance, no hydrostatic testing and no batteries. The technology is safe and easy-to-use for the layperson. You simply twist a dial and the two powders mix and generate oxygen at a steady flow, bridging the gap between the onset of a medical emergency and the arrival of first responders.
OxySure is the brainchild of Chairman and CEO Julian Ross, a Venture Capitalist who has spent the last decade developing the technology and shepherded the product through FDA approval. Ross raised $14 million of private capital for the company, including a $3 million personal investment. OxySure was taken public in 2011. As sales rise exponentially, the company is strong a candidate to graduate to a more senior exchange, possibly the NASDAQ or NYSE.
“The OxySure Model 615 is a great companion product to the AED,” states Ross in an exclusive interview with Financial Press. “Before we begin to tap into other markets, we are going to aggressively pursue this existing ready-made market.”
This synergy was confirmed on September 26, 2011, when a 7th grader had cardiac arrest in a Texas school and crumpled to the floor. Two quick-thinking schoolteachers applied CPR and used an AED to restart Kylee Shea’s heart. Immediately after that, oxygen was administered using the OxySure Model 615.
OxySure’s initial marketing plans include targeting 102,265 educational campuses in the U.S., 350,735 manufacturing facilities, 350,000 churches, and 950,000 restaurants.
Eventually Ross intends to place the Model 615 in any public or private place where people are at risk. Although the company is selling directly to end-users, it is primarily capitalizing on these markets through partnerships with distributors.
“We have about 40 different distributors globally,” states Ross. “Many of our distributors also distribute AEDs. Our sales people understand the market, and they are positioning the Model 615 as a companion product to the AED. Our oxygen-on-demand device is much cheaper than a defibrillator and used in a wider variety of medical emergencies — like asthma attacks, oxygen deprivation, dehydration, seizures, traumatic and shock related injuries.”
For the first time in history a patient, bystander or loved one can administer pre-positioned, medically pure oxygen safely in a cardiovascular, respiratory or general medical emergency.
As well as the emotional and ethical incentives to save lives, the OxySure product can deliver cost efficiencies. The quick availability of medically pure oxygen makes it much less likely that a patient will require extensive hospitalisation or indeed any at all.
According to the Centers for Disease Control and Prevention (CDC), an estimated 25 million people, including almost 7 million children, have asthma. Asthma accounts for more than 15 million physician and outpatient department visits yearly and nearly 2 million emergency room visits. Asthma is the third-ranking cause of hospitalization among children under 15.
The CDC has determined that the annual economic cost of asthma, including direct medical costs and indirect costs such as lost school and work days, amounts to more than $56 billion annually.
“Of course it is gratifying to know that our technology saves lives,” states Ross. “The key point is that we have put enormous resources into ensuring that a layperson can administer the oxygen safely. But there is also a financial dimension to this. Timely delivery of medical oxygen to distressed individuals delivers substantial savings to the medical system by reducing hospitalisations. The device also delivers cost savings to institutions by reducing absenteeism.”
In the next 3-5 years OxySure plans to add more than 100 new distributors and grow its direct sales force and strategic accounts teams to more than 500 individuals. The company intends to pursue legislation and mandates that would require the Model 615 in school and public places.
“It [the Model 615] is a great tool,” stated Tysha Beaty, an athletic trainer who treated Brody Justice on the Texas high-school playing field, “Especially for asthmatic athletes. It helps us before we have to call EMS. Or it helps us to where we can calm them down and we don’t have to call EMS.”
OxySure is currently trading at .72 with a market capitalisation of $17 million.
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