4/2019 Disclosure of inside information on the risk of a decrease in the revenues of the Issuer’s subsidiary, Medi-Lynx Cardiac Monitoring, LLC

Disclosure of inside information on the risk of a decrease in the revenues of the Issuer’s subsidiary, Medi-Lynx Cardiac Monitoring, LLC

Current Report No. 4/2019

Date: 1 March 2019

Legal basis: Article 17(1) of MAR – inside information

The Management Board of Medicalgorithmics S.A. publishes the below inside information concerning the risk of a decrease in the revenues of the Issuer’s subsidiary, Medi-Lynx Cardiac Monitoring, LLC. Disclosure of inside information was delayed on January 14, 2019 pursuant to Article 17(4) of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ L 173, 12.6.2014, p. 1–61 as amended, the “Market Abuse Regulation”).

  1. The delayed inside information

“The Management Board of Medicalgorithmics S.A. (“Company” “Issuer”) notifies that on January 14, 2019 the Issuer’s subsidiary, Medi-Lynx Cardiac Monitoring, LLC (“Medi-Lynx”) has received a notification from MultiPlan, Inc. (“MultiPlan”), a network of health services providers that lease their network to insurance carriers.  The notification states that the MultiPlan network contract rates for Medi-Lynx per the agreement between Medi-Lynx and MultiPlan dated June 1, 2016 (“Agreement”) applicable to claims for certain insurance carrier clients of MultiPlan would no longer apply. This entails the risk of a decrease in the revenues of Medi-Lynx. Payments received by Medi-Lynx in 2018 from all insurers using MultiPlan constitutes app. 21.6% of the total Medi-Lynx revenues in 2018, that is 11.7 mln USD. The Executive Board of Medi-Lynx, promptly after receiving the notification from MultiPlan, initiated discussions on the terms of the Agreement in order to secure the amount of revenues received, and to help ensure that the majority of MultiPlan insurer clients will continue to use them to price certain Medi-Lynx claims.

This event is the materialization of the risk of reducing reimbursements related to the model of cooperation between Medi-Lynx and private insurers with whom long term in-network contracts are not signed (out-of-network model). The Company informed about that risk in its consolidated semiannual report for Medicalgorithmics Capital Group (the “Group”) for the first half of 2018 (Management Board Report on the Operations of Medicalgorithmics Capital Group, Risk of terminating or reducing reimbursements, page 16).

It should be noted that one of the Group’s medium-term objectives is to change the business model by entering into long term in-network contracts directly with key private insurers. The Group assumes that this objective, while resulting in lower reimbursement rates per claim, will provide an increase in access to additional customers resulting in a significant increase in volume. The Group believes this will allow Medi-Lynx to increase its revenues year over year and deliver on its growth strategy. Also, this strategy  will allow  Medi-Lynx to have increased certainty and stability of its revenues.

  1. Grounds for the delay of disclosure of inside information

The Management Board of the Company decided to delay disclosure of inside information due to and until the discussions between Medi-Lynx and MultiPlan were further understood. The Management Board of the Issuer believes that the delay of disclosure meets the requirements set out in the Market Abuse Regulation, taking into account that immediate disclosure of inside information before identifying the demands of the insurers and having the new network terms agreed on  is likely to affect the relationship amongst and between all the parties and thus prejudice the legitimate interests of the Issuer. Furthermore, the Company had reason to believe that the delay of disclosure is not likely to mislead the public. Premature publication of inside information could mislead current and potential shareholders about the impact of inside information on the Group’s financial results. The Company was able to and took the necessary steps to ensure the confidentiality of information until it was disclosed by the Issuer.

  1. Term for disclosure of inside information

The Management Board of the Company decided to disclose inside information due to the fact that the grounds for the delay of disclosure no longer exist. The estimated impact of this information on financial results of the Group is already known.

Your submission was succesfull

Software

Get more information
The data administrator is Medicalgorithmics S.A. with its registered office in Warsaw (02-001) at Al. Jerozolimskie 81. The data will be processed in order to answer the query sent (legal basis: legitimate interest of the administrator), marketing (legal basis: legitimate interest of the administrator). The full text of the clause can be found on the Privacy Policy page.

VCAST

Get a free demo
The data administrator is Medicalgorithmics S.A. with its registered office in Warsaw (02-001) at Al. Jerozolimskie 81. The data will be processed in order to answer the query sent (legal basis: legitimate interest of the administrator), marketing (legal basis: legitimate interest of the administrator). The full text of the clause can be found on the Privacy Policy page.

DRAI

Get a free demo
The data administrator is Medicalgorithmics S.A. with its registered office in Warsaw (02-001) at Al. Jerozolimskie 81. The data will be processed in order to answer the query sent (legal basis: legitimate interest of the administrator), marketing (legal basis: legitimate interest of the administrator). The full text of the clause can be found on the Privacy Policy page.

Our company

About us

Our History

Management Team

Partners

Career

Work with us

Job offers

Recommend an employee

Application form