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Sunday, September 25, 2022

Progressive Care Inc. (OTCQB: RXMD) Soars on $8.3 million NextPlat Investment

Progressive Care Inc. (OTCQB: RXMD) is up over 40% after NextPlat Corp, its Executive Chairman and CEO, Charles M. Fernandez, and board member, Rodney Barreto, and certain other investors will invest an aggregate of $8.3 million into Progressive Care.  In connection with the recapitalization, NextPlat will purchase 3,000 newly issued Units of Progressive Care valued at $6 million, with each Unit comprised of one share of Progressive Care’s Series B Preferred Stock and one Warrant to purchase a share of Series B Preferred Stock. In addition, NextPlat Corp, Messrs. Fernandez and Barreto, and certain other investors will purchase $2.3 million of outstanding convertible debt from an existing holder. NextPlat’s management team and select members of its BOD will provide RXMD with their market-proven expertise in healthcare and digital technology including the development of new healthcare and lifestyle products to be sold via NextPlat’s global e-commerce marketplaces. As part of this transaction, Mr. Fernandez will be appointed as Chairman of Progressive Care replacing Alan Jay Weisberg who will step down from his current positions to assume the new roles of Vice Chairman and CEO.   

This is big news for RXMD shareholders who have had little to get excited about over the past year. The stock saw a huge move in early 2021 rocketing up to over $0.19 per share from current levels. This investment from NextPlat is a big deal and could be the catalyst to get RXMD moving again especially because this wipes out the convertible debt. NextPlat Executive Chairman and CEO, Charles M. Fernandez has successfully identified profitable start-up and dislocation opportunities, and built significant shareholder value, executing both private and public exits over the past 30 years. Mr. Fernandez’s expertise in technology and healthcare includes co-founding Lakeview Health Systems (acquired by a private equity firm for approximately $70 million) and Continucare Corporation (acquired by Metropolitan Health Networks, Inc. for approximately $400 million) where he served as chairman, president and CEO. He also served as an investor, director, and Chairman of the Audit Committee of IVAX Corporation for nearly a decade prior to its purchase by Teva Pharmaceuticals for $8.7 billion.  

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Progressive Care Inc. (OTCQB: RXMD), through its subsidiaries, is a Florida health services organization and provider of prescription pharmaceuticals, compounded medications, provider of tele-pharmacy services, the sale of anti-retroviral medications, medication therapy management (MTM), the supply of prescription medications to long-term care facilities, and health practice risk management. The Company boasts 4 physical pharmacy locations (in North Miami Beach, Davie, Palm Springs, and Orlando) with 5-star performance ratings and nearly 125 employees from which to launch further expansion and sales growth. Progressive Care has been featured by mainstream press including in prestigious online magazines such as Forbes, Microcapdaily, and HuffPost. PharmCo Rx is licensed in Colorado, Connecticut, Florida, Georgia, Illinois, Nevada, New Jersey, New York, Pennsylvania, Texas, Utah, Arizona, Massachusetts and Minnesota.  

Progressive Care provides Third Party Administration (“TPA”), data management, COVID-19 related diagnostics and vaccinations, prescription pharmaceuticals, compounded medications, tele-pharmacy services, anti-retroviral medications, medication therapy management, the supply of prescription medications to long term care facilities, medication adherence packaging, contracted pharmacy services for 340B Covered Entities under the 340B Drug Discount Pricing Program, and health practice risk management.  

In 2020 Progressive Care formed ClearMetrX, a wholly-owned data management company with services designed to support health care organizations across the country. Management believes Artificial Intelligence (“AI”) will improve preventive healthcare by helping physicians make informed decisions in the medication therapy management process. The Company has transitioned data service customers from the pharmacies to the ClearMetrX platform to better scale the products and improve the capabilities of existing analytics options. 

On August 12 RXMD announced financial results for the 3 months ended June 30, 2022. For the three months ended June 30, 2022 and 2021, the Company recognized overall revenue from operations of approximately $10.0 million and $9.6 million, respectively. Prescription revenue for the three months ended June 30, 2022 was approximately $9.3 million when compared to $8.2 million the same period in 2021, a 13% period-over-period increase. 

The Company’s pharmacy business filled approximately 118,000 and 107,000 prescriptions during the three months ended June 30, 2022, and 2021, respectively, a 10% period over period increase in the number of prescriptions filled. 340B contract revenue for the three months ended June 30, 2022 was flat as compared to the same period in 2021. Revenue from COVID-19 testing was approximately $0.4 million and $1.1 million for the three months ended June 30, 2022, and 2021, respectively. The decrease was primarily due to lower COVID-19 testing sales. As the COVID-19 pandemic faded worldwide, the need for testing has decreased as it relates to travel and business continuity. The Company’s CFO, Cecile Munnik said, “It is difficult to predict whether these conditions will be recurring given recent COVID-19 pandemic conditions but we are well positioned to react if another COVID-19 outbreak occurs as we have built a reputation of being a reliable partner for COVID-19 testing solutions. We have built reputable relationships with well-known media productions companies and these relationships provide us with recurring COVID-19 testing revenue.” 

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Under the recapitalization plan, NextPlat Corp, its Executive Chairman and CEO, Charles M. Fernandez, and board member, Rodney Barreto, and certain other investors will invest an aggregate of $8.3 million into Progressive Care. In connection with the recapitalization, NextPlat will purchase 3,000 newly issued Units of Progressive Care valued at $6 million, with each Unit comprised of one share of Progressive Care’s Series B Preferred Stock and one Warrant to purchase a share of Series B Preferred Stock. In addition, NextPlat Corp, Messrs. Fernandez and Barreto, and certain other investors will purchase $2.3 million of outstanding convertible debt from an existing holder. In connection with debt purchase, NextPlat Corp and the other purchasers agreed to a fixed conversion price of $0.02 per share of common stock and removal of the blocker. NextPlat Corp and the other purchasers also agreed to reduce the interest rate on the purchased debt from 10% to 5% per annum. 

NextPlat’s management team and select members of its Board of Directors will provide Progressive Care with their market-proven expertise in healthcare and digital technology including the development of new healthcare and lifestyle products to be sold via NextPlat’s global e-commerce marketplaces. As part of this transaction, Mr. Fernandez will be appointed as Chairman of Progressive Care replacing Alan Jay Weisberg who will step down from his current positions to assume the new roles of Vice Chairman and CEO. Mr. Barreto will also be joining Progressive Care’s board as Vice Chairman. Dawson James Securities Inc. (“Dawson”) served as the placement agent for this transaction. Progressive Care intends to utilize a portion of the growth capital to further fund deployment of its digital platforms and the development and sale of new health, fitness, and beauty products. 

Progressive Care Inc. is a Florida-based technology-centric healthcare organization. It provides prescription pharmaceuticals and contracted pharmacy services directly to consumers, long-term care facilities as well to 340B covered entities in underserved or vulnerable communities in 13 states. Progressive Care also has developed and provides extensive healthcare data management and analytics services in addition to providing virtual healthcare to customers. In 2021, Progressive Care reported annual revenues of approximately $40 million. 

Over the past 30 years, Mr. Fernandez has successfully identified profitable start-up and dislocation opportunities, and built significant shareholder value, executing both private and public exits. Mr. Fernandez’s expertise in technology and healthcare includes co-founding Lakeview Health Systems (acquired by a private equity firm for approximately $70 million) and Continucare Corporation (acquired by Metropolitan Health Networks, Inc. for approximately $400 million) where he served as chairman, president and CEO. He also served as an investor, director, and Chairman of the Audit Committee of IVAX Corporation for nearly a decade prior to its purchase by Teva Pharmaceuticals for $8.7 billion. 

“Progressive Care has built a vibrant and rapidly growing healthcare services and technology company currently serving tens of thousands of customers who rely on its PharmcoRx platform and services every day. As a technology and healthcare entrepreneur, I see tremendous value in Progressive Care’s capabilities which is why I am personally investing alongside of NextPlat. I believe we can leverage our expertise, industry know-how and global e-commerce platforms to accelerate their continued growth domestically as well as internationally. As long-term investors, we are committed to harnessing the power of digital technologies including Web3, to capitalize on the ongoing digital transformation of Progressive Care and the entire healthcare industry,” said Charles M. Fernandez. 

Alan Jay Weisberg commented, “Progressive Care has pursued a vision of being able to transform the healthcare industry by creating data-driven tools and technology. Charlie and the team at NextPlat have extensive knowledge and experience in utilizing digital technology and we believe will help Progressive Care build significant value for all stakeholders including patients, payors, practitioners, and investors. We are excited to have this team of industry leaders as our new long-term investors and partners, and look forward to working together advancing our vision for modern healthcare.” 

https://twitter.com/HedgehogTrader/status/1564980999657758720

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Currently trading at a $12 million market valuation RXMD is one exciting story developing in small caps. As we have reported NextPlat Corp, its Executive Chairman and CEO, Charles M. Fernandez, and board member, Rodney Barreto, and certain other investors will invest an aggregate of $8.3 million into Progressive Care. This investment from NextPlat is a big deal and could be the catalyst to get RXMD moving again especially because this wipes out the convertible debt. With no dilution and the support of NextPlat the shorts could be in trouble here. Charles M. Fernandez co-founded Lakeview Health Systems (acquired by a private equity firm for approximately $70 million) and Continucare Corporation (acquired by Metropolitan Health Networks, Inc. for approximately $400 million) where he served as chairman, president and CEO. He also served as an investor, director, and Chairman of the Audit Committee of IVAX Corporation for nearly a decade prior to its purchase by Teva Pharmaceuticals for $8.7 billion. Now he has invested in Progressive Care Inc. RXMD has 548,962,587 shares outstanding with AS set at 1 billion and a float of just 463,729,041 shares and recently became an SEC filer. RXMD traded as high as $0.195 in early 2021.  We will be updating RXMD as events unfold so make sure you are subscribed to Microcapdaily so you know what is going on with RXMD.

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Disclosure: we hold no position in RXMD either long or short and we have not been compensated for this article.

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