Strategic investment

RNS Number : 6314W

EKF Diagnostics Holdings PLC

20 August 2020

 

This announcement contains inside information
for the purposes of Article 7 of Regulation (EU) No 596/2014 (MAR)

EKF Diagnostics Holdings plc

("EKF", the "Company" or the "Group")

Strategic investment

US$5m funding into Trellus Health to transform care for complex chronic conditions

EKF Diagnostics Holdings plc (AIM: EKF), the AIM listed point-of-care business, has made a US$5 million investment into Trellus Health Limited ("Trellus Health"), a resilience-driven digital health solution for complex chronic conditions. The investment will be used to support the newly incorporated company's work to transform the way chronic conditions are treated, with an initial focus on Inflammatory Bowel Disease (IBD), including Crohn's disease and ulcerative colitis.

As previously announced, EKF and Mount Sinai Innovations Partners entered into a relationship to identify technologies to advance a novel digital health platform for early intervention and better care management for patients with IBD, resulting in the formation of and investment into Trellus Health.  

The financing was led by EKF in partnership with Mount Sinai Health System ("MSHS"). EKF believes that the Trellus Health digital health platform will provide substantial value for patients and providers, and has the potential to provide attractive returns to shareholders. It is the Trellus Health investors' intention, in the future, to conduct initial market soundings to determine the feasibility and timing of an initial public offering (IPO), and the potential admission to trading on the AIM Market of the London Stock Exchange (AIM) for Trellus Health. If an IPO was to take place the expectation would be for this to take place in early 2021. EKF expects to distribute its holding in Trellus Health to its shareholders by way of a distribution in specie as soon as is practicable . Further announcements will be made, as appropriate.

Trellus Health has also entered into an exclusive multi-year licence with MSHS to commercialise its patent pending GRITT-IBD^TM resilience assessment and personalised treatment methodology. Better evaluation and personalised management of IBD patients, including the implementation of appropriate care delivery pathways in a more timely manner than current practice allows, is expected to deliver better healthcare outcomes (including quality of life and fewer hospitalisations) and on a more cost-effective basis than current approaches.

Ninety percent of the United States' $3.3 trillion annual health care expenditure is for chronic diseases, with patients suffering from both chronic medical and mental health conditions costing twice as much, according to CDC¹. The first chronic condition that Trellus Health will address is IBD, one of the costliest chronic conditions with a high associated mental health burden, affecting three million patients in the U.S², (7 million globally) and costing the U.S. healthcare system over $30 billion a year, according to The Cost of Inflammatory Bowel Disease: An Initiative From the Crohn's & Colitis Foundation 2019 ³ . 

Erik Lium, President, Mount Sinai Innovation Partners, Executive Vice President and Chief Commercial Innovation Officer at Mount Sinai, and board member of Trellus Health stated: "Crohn's disease was discovered at Mount Sinai by Dr. Burrill Crohn nearly 100 years ago, and the Mount Sinai Health System has made great strides in enhancing the standard of care and outcomes for our patients. We're pleased to partner with Trellus Health and EKF to advance commercial development of a resilience-driven approach and connected care model for treating IBD and other complex chronic conditions, making Mount Sinai's technology available to more patients."

Resilience-driven care incorporates positive psychology principles into all aspects of chronic disease management, with a focus on building acceptance, optimism, self-regulation, self-efficacy, and social support. Proven health benefits of resilience include increased longevity, cardiovascular, immune and cognitive function, as well as physical well-being and reduced risk for depression and anxiety.

In a recent study published by Inflammatory Bowel Disease (IBD) Journal ⁴ , findings demonstrated that high levels of resilience are independently associated with lower disease activity and better quality of life in patients with IBD. The study also suggested that resilience may be a modifiable factor that can risk-stratify IBD patients to identify those prone to poorer outcomes. Investigators of the study included Trellus Health co-founders Marla C. Dubinsky, MD, Professor of Pediatrics and Medicine, Chief of Division of Pediatric Gastroenterology, co-director of the Susan and Leonard Feinstein IBD Clinical Center at Mount Sinai, and board member of Trellus Health, and Laurie Keefer, PhD, Director for Psychobehavioral Research in Mount Sinai's Gastroenterology Division. Drs. Dubinsky and Keefer have more than 40 years of combined experience managing IBD patients utilizing a personalized, patient-centric approach that focuses on building resilience in people living with IBD.

Julian Baines, CEO of EKF Diagnostics, said: "EKF is very excited to support the commercial advancement of Trellus Health, alongside Mount Sinai. This is another example of our combined support for a pioneering medical approach that can make a huge difference to the well-being of people with complex chronic health conditions, as well as driving much needed healthcare economic benefits. IBD is one of the most costly and complex incurable diseases and Trellus Health's digital health platform has already been used within Mount Sinai to show how this approach can reduce unplanned hospital interventions."

Monique Fayad, CEO of Trellus Health, said: "We are transforming the way complex chronic conditions are treated by developing a resilience-driven connected care platform that integrates precision medicine with psychosocial care. The traditional journey of medical care for people living with chronic conditions typically results in repeated costly, unplanned emergency room visits and hospitalizations, high rates of work absenteeism and lost productivity, as well as chronic disability and behavioural health issues. We're working to change this by focusing on building patients' resilience while integrating all partners in care, including employers, insurance plans, health systems, Trellus-certified GI providers, nurses, psychologists, and dieticians who will utilize Trellus Health's proprietary cloud-based technology platform to effectively monitor and communicate with patients and their caregivers in real time."

¹   https://www.cdc.gov/chronicdisease/about/costs/index.htm

²   https://www.cdc.gov/ibd/data-statistics.htm

³   https://pubmed.ncbi.nlm.nih.gov/31112238/

⁴   https://academic.oup.com/ibdjournal/article-abstract/doi/10.1093/ibd/izaa196/5874745?redirectedFrom=fulltext

EKF Diagnostics Holdings plc		www.ekfdiagnostics.com
Christopher Mills, Non-executive Chairman		Tel: [phone]
Julian Baines, CEO
Richard Evans, FD & COO
N+1 Singer		Tel: [phone]
Aubrey Powell / George Tzimas (Corporate Finance) Tom Salvesen (Corporate Broking)
Walbrook PR Limited	Tel: [phone] or [e-mail]
Paul McManus / Lianne Cawthorne	Mob: [phone]

About EKF Diagnostics Holdings plc

EKF is a leading point-of-care diagnostics and central laboratory assay manufacturer with an estimated 80,000 hemoglobin, hematocrit, HbA1c, glucose and lactate analyzers in regular use across more than 100 countries. EKF specializes in developing tests for use in anemia and diabetes diagnosis and management, as well as providing a portfolio of reagents for use in clinical chemistry analyzers.

About Trellus Health

Trellus Health is a leading pioneer in resilience-driven care for people with complex chronic conditions. Through its multidisciplinary connected care platform, Trellus Health coordinates expert whole-person care, including both clinical and behavioural health, to improve outcomes and to reduce healthcare costs for patients, employers, and the healthcare system. The Company leverages its patent-pending GRITT-IBD^TM resilience assessment and personalised treatment methodology, developed at the Mount Sinai Health System, to support improved patient resilience and wellness for better outcomes. For more information on Trellus Health, visit www.trellushealth.com .  

The resilience-driven connected care solution described is based on technology developed by Mount Sinai faculty and licensed to Trellus Health. Mount Sinai and Mount Sinai faculty members Marla Dubinsky, MD, and Laurie Keefer, PhD, have an economic interest in Trellus Health.

About Mount Sinai Innovation Partners (MSIP)

MSIP is responsible for driving the real-world application and commercialization of Mount Sinai discoveries and inventions, and the development of research partnerships with industry. Our aim is to translate discoveries and inventions into health care products and services that benefit patients and society. MSIP is accountable for the full spectrum of commercialization activities required to bring Mount Sinai inventions to life. These activities include evaluating, patenting, marketing and licensing new technologies building research, collaborations and partnerships with commercial and nonprofit entities, material transfer and confidentiality, coaching innovators to advance commercially relevant translational discoveries, and actively fostering an ecosystem of entrepreneurship within the Mount Sinai research and health system communities. For more information, visit  www.ip.mountsinai.org

About the Mount Sinai Health System

The Mount Sinai Health System is New York City's largest academic medical system, encompassing eight hospitals, a leading medical school, and a vast network of ambulatory practices throughout the greater New York region. Mount Sinai is a national and international source of unrivaled education, translational research and discovery, and collaborative clinical leadership ensuring that we deliver the highest quality care-from prevention to treatment of the most serious and complex human diseases. The Health System includes more than 7,200 physicians and features a robust and continually expanding network of multispecialty services, including more than 400 ambulatory practice locations throughout the five boroughs of New York City, Westchester, and Long Island. The Mount Sinai Hospital is ranked No. 14 on U.S. News & World Report's "Honor Roll" of the Top 20 Best Hospitals in the country and the Icahn School of Medicine as one of the Top 20 Best Medical Schools in country. Mount Sinai Health System hospitals are consistently ranked regionally by specialty and our physicians in the top 1% of all physicians nationally by U.S. News & World Report.

For more information, visit  https://www.mountsinai.org  or find Mount Sinai on  Facebook ,  Twitter  and  YouTube .

Additional disclosures made in the interests of transparency and in accordance with the AIM Rules for Companies

Shareholdings in Trellus Health:

Following the investment in Trellus Health by EKF, the Company will own approximately 31.11% of the post money share capital of Trellus Health (assuming conversion of 1 'golden' share which it will also receive on completion of its investment). In addition, on incorporation, certain EKF Directors and personnel subscribed for shares upon the incorporation of Trellus Health, such that their resulting shareholdings are as follows. The relevant directors, being Julian Baines (CEO, EKF) and Richard Evans (CFO, EKF) hold 2.21% and 1.10% each of the shares of Trellus Health. In addition, certain EKF personnel, being Salim Hamir (Company Secretary, EKF) and Mike Salter (President, Americas, EKF), hold a further 2.20% in aggregate. In accordance with the terms of the investment agreement, Julian Baines and Mike Salter are being appointed as EKF's representatives to the board of Trellus Health.

The balance of the equity in Trellus Health is held by the Icahn School of Medicine at Mount Sinai and the two co-founders and the CEO of Trellus Health. The preceding figures and description assume the exercise, in full, of a founding option granted to the CEO of Trellus Health, but do not take into account a further option pool which is expected to be created for the benefit of Trellus Health personnel, over such number of shares as would represent 10% of the fully diluted share capital of the company. 

Information on Trellus Health:

Trellus Health Limited was incorporated on 15 July 2020 with company number, 12743489. As a newly incorporated entity, Trellus Health has no historic trading record to disclose. In consideration for the licence to it of certain intellectual property by Mount Sinai, Trellus Health will pay Mount Sinai an upfront licence fee and a royalty calculated as a percentage of subsequent sales.  

 

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