tdoc corporate presentations september 2015 -...
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The relentless pursuit of better!
September 2015
2 I Copyright 2015 Teladoc Inc.
Safe Harbor Statement
This presentation contains, and our officers may make, “forward-looking” statements that are based on our management’s beliefs and assumptions and oninformation currently available to management. These forward-looking statements include, without limitation, information concerning possible or assumedfuture results of operations, including descriptions of our business plan and strategies. These statements often include words such as ‘‘anticipate,’’ ‘‘expect,’’‘‘suggests,’’ ‘‘plan,’’ ‘‘believe,’’ ‘‘intend,’’ ‘‘estimates,’’ ‘‘targets,’’ ‘‘projects,’’ ‘‘should,’’ ‘‘could,’’ ‘‘would,’’ ‘‘may,’’ ‘‘will,’’ ‘‘forecast,’’ and other similar expressions.
Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievementsto be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-lookingstatements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materiallydifferent from any future results, performance or achievements expressed or implied by the forward-looking statements. These statements are based on certainassumptions that we have made in light of our experience in the industry and our perception of historical trends, current conditions, expected futuredevelopments and other factors we believe are appropriate under the circumstances as of the date hereof. These and other important factors may cause ouractual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Such risks and otherfactors that may impact management’s beliefs and assumptions are more particularly described in our filings with the U.S. Securities and ExchangeCommission (the “SEC”). As a result, we cannot guarantee future results, outcomes, levels of activity, performance, developments or achievements, and therecan be no assurance that our expectations, intentions, anticipations, beliefs or projections will result or be achieved or accomplished. The forward-lookingstatements in this presentation are made only as of the date hereof. Except as required by law, we assume no obligation to update these forward-lookingstatements, or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new informationbecomes available in the future.
This presentation also contains estimates and other statistical data made by independent parties and by us relating to market size and growth and other dataabout our industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates.
This presentation may include certain non-GAAP financial measures as defined by SEC rules. We believe that the presentation of such non-GAAP financialmeasures enhance an investor’s understanding of our financial performance. We use certain non-GAAP financial measures for business planning purposesand in measuring our performance relative to that of our competitors.
3 I Copyright 2015 Teladoc Inc.
Introductions and Presenters
• CFO since October 2012
• CFO of RCS/Media Monitors
• CFO of BT Radianz
• Vice President and Global Controller of RSL Communications
• CEO since June 2009
• President of Empire BlueCross BlueShield
• SVP and Chief Marketing and Product Officer at WellPoint
• Director of Service Strategy and other roles at Oxford Health Plans
• General Manager of Business Messaging at Mail.com
Mark HirschhornEVP & CFO3 years
Jason GorevicPresident & CEO
6 years
What we doResolving patient issues, delivering client ROI
Provide 24x7, on demand access to board-certified doctors via phone, mobile, and video
Diagnose, treat and prescribe medications (if necessary) for common health issues
Behavioral health, dermatology and smoking cessation available
Prevent unnecessary ER/UC visits to more cost-effective mode of care
4©2015 Teladoc, Inc. All rights reserved.
Teladoc at a Glance
$20M
$44M
2013 2014 Q1 '14 Q1 '15
6.2M8.1M 7.8M
11.5M
2013 2014 Q2 '14 Q2 '15
4,000+Total Clients
$10M$18M
Q2 '14 Q2 '15
127K
299K
61K125K
2013 2014 Q2 '14 Q2 '15
Revenue ($M)
Visits (000s)
Members (M)
Doubled client and membership bases
over the past two years
12.5 million Unique Members
20+Health plan Clients
160 Fortune 1000 Clients
6 I Copyright 2015 Teladoc Inc.
Excellence by the Numbers24x7x365 on-demand healthcare anytime, anywhere via mobile devices, internet, video and phone
1 Over the last six years 2 Our subscription access fee revenue provides significant visibility into our future operating results. For example, our annualized January 2013 and 2014 revenue reflected approximately 90% of our actual and
budgeted revenue for each respective full fiscal year3 Based on an independent study of the nation’s largest home-improvement retailer, a Client since 2012 with 150,000+ Members as of 12/31/144 Average over the last three years5 Based on the ability of a Teladoc physician to earn ~$150/hour which represents a 50%+ increase to the average full-time physician hourly wage
+95%Average Member Satisfaction1
1,500+Visits per Day on Average
104% Average Net Dollar Retention4
50%Increase to Physician
Hourly Income5
+9xClient ROI3
92%Patient Issues Resolved3
+90%Revenue Visibility2
417mAnnual Addressable Visits
<10 MinMedian Physician Response Time
7 I Copyright 2015 Teladoc Inc.
Investment Highlights
Attractive Business Model with Strong Revenue Growth and Substantial Opportunity to Scale
Value for All Constituents: Payor / Employer; Member / Employee & Provider
Delivering Significant, Measurable ROI
First and Largest Telehealth Solution
Disruptive Care Delivery Model with High Clinical Quality
Growing Underpenetrated Market with an Estimated 417mm Annual Patient Visits
8 I Copyright 2015 Teladoc Inc.
Sustainable Differentiation
+
+ ROIUtilizationConsumer Engagement
=
Network structureNetwork structure
Clinical capabilities
Clinical capabilities
Scalable and integrated technology
Scalable and integrated technology
Robust capabilities that deliver significant and measurable ROI to Clients
+
9 I Copyright 2015 Teladoc Inc.
Teladoc’s Total Addressable Market
1.25 billion ambulatory care visits11.25 billion ambulatory care visits1
Primary carePrimary care ERER Outpatient Outpatient OtherOther
1 According to a 2010 report from the Centers for Disease Control and Prevention (CDC); includes visits in the United States per year, including those at primary care offices, hospital emergency rooms, outpatient clinics and other settings
2 33% based on Teladoc's internal estimates / assessment of conditions listed in the CDC report. According to a Deloitte report “eVisits: The 21st Century Housecall,” of the 600 million annual visits to general practitioner offices in the US and Canada, about 50% are treatable through telehealth
3 Based on Teladoc estimates for average cost of a telehealth visit (does not include PMPM fees or premium pricing for new products)
33% estimated treatable through telehealth2
417 million visits417 million visits Up to $40 cost per telehealth visit3
Up to $40 cost per telehealth visit3 TAMTAM=×
10 I Copyright 2015 Teladoc Inc.
The Teladoc Solution is Simple, Convenient and Intuitive for the Member…
Note: Reflects next generation mobile application currently in development.
1 REGISTER 2 REQUEST & CONNECT3 4 VISIT & RESOLVE5
In 2015, Teladoc will deliver over 50,000 visualized consults, more than anyone else in the industry
40%Web/Mobile
60%Call Center
70%
30%“Visualized” via video and/or uploaded HD Images
Telephonic
How Members request a Consult Type of Consult patients choose*
11©2015 Teladoc, Inc. All rights reserved.
12 I Copyright 2015 Teladoc Inc.
Common Uses and Best Practices
o Proprietary evidence based clinical
guidelines
o National Committee for Quality Assurance
certification (NCQA)
o Electronic prescribing
o Patient education
o EMR sharing with existing physicianso Dermatology
o Anxiety
o Smoking Cessation
Top Diagnoses and Cases Teladoc Best Practices
Areas of New Clinical Expansion
o Sinusitis
o Urinary Tract Infection
o Conjunctivitis (Pink Eye)
o Upper Respiratory Infection
o Nasal Congestion
o Bronchitis
o Allergies
o Influenza
o Yeast Infection
o Cough and Cold
o Grief Counseling
o Marriage Counseling
o Sexual Health
13 I Copyright 2015 Teladoc Inc.
High Clinical Quality
Only US telehealth company
Zero malpractice claims
Continuity of care records
(i.e., EMR sharing)
100% visits reviewed for new
physicians
10% charts reviewed monthly
Adherence to 100+ proprietary evidence-
based clinical guidelines
92% clinical resolution1
Teladoc physicians are consistently reviewed to ensure a high level of quality care and adherence to appropriate treatment and prescription guidelines
1 Based on an independent study of the nation’s largest home-improvement retailer, a Client since 2012 with 150,000+ Members as of 12/31/14
14 I Copyright 2015 Teladoc Inc.
…but with Complex Operations Integrated into the Broader Healthcare Ecosystem
Our approach to driving utilizationWhen planning, we look for multiple ways to support our
clients driving awareness and engagement
15©2015 Teladoc, Inc. All rights reserved.
On-site messaging and integration via Marketing Communications Portal
Broad based National Marketing that drive results
Best in class Teladocmember messaging
16 I Copyright 2015 Teladoc Inc.
Employers Health Plans Health Systems
Serving Leading CustomersOver 4,000+ clients including 160 Fortune 1000 companies and more than 20 health plans, plus health systems and other entities
34% 21% 6% 52%Visits occurred on
weekends and holidays
Patients had not sought care in the past year
Required a follow-up visit (vs 20% ER)
Represent top 3 diagnoses (vs 72%
at retail clinics)
This independent study by Rand of 300,000 Teladoc participants analyzed 2 years of claims data, conducting a 21-day episode of care analysis.
An independent studyby Rand revealed::
Quality and effectiveness with great value
17©2015 Teladoc, Inc. All rights reserved.
18 I Copyright 2015 Teladoc Inc.
Case Study: Rent-a-Center represented 24,000 Members(1)
Note: Weighted Average is based on redirection rates determined using member utilization of bricks and mortar services: 75% OV; 20% ER; 5% Do Nothing Source: (1) Cost savings data are based on an independent study of Rent-a-Center, a Client with 24,000+ Members as of 12/31/14 analyzed over a period of 24 months
(2) RAND Corporation, February 3, 2014.
Clinical Capabilities Drive Significant Savings
Breadth(2)“Teladoc served patients with surprisingly
diverse diagnoses.”
Breadth(2)“Teladoc served patients with surprisingly
diverse diagnoses.”
Quality(2)“Patients who used Teladoc were less likely to have a follow-up visit to any setting, compared
to those patients who visited a physician’s office or emergency department”
Quality(2)“Patients who used Teladoc were less likely to have a follow-up visit to any setting, compared
to those patients who visited a physician’s office or emergency department”
(1)
19 I Copyright 2015 Teladoc Inc.
Note: Data based on independent studies using healthcare utilization data. 1 PMPM refers to “per member per month”“PMPM analysis” evaluated resource use and spending before vs. after Teladoc (represents 18 month and 20 month periods prior to and following the Teladoc implementation, respectively)‘‘Episode-based analysis” evaluated resource use and spending by Teladoc users vs. other beneficiaries receiving care for same conditions in physician offices or ERs
Case Study: Nation’s Largest Home Improvement Retailer with 150,000 Members
$593KSubscription access fees
paid in 2014
$593KSubscription access fees
paid in 2014
$5.4 millionEst. Client savings in 2014
from using Teladoc
$5.4 millionEst. Client savings in 2014
from using Teladoc
9.0xROI from Teladoc=÷
Significant and Measurable ROI
1 2
3
$40
Teladoc Savingsvs.
Office VisitAverage savings
per employeeTeladoc Savings
vs.ER Visit
$2,661
$1,157
$2,661
$191
Total spending before and after Teladoc introduction
$21.30Average reduction
vs. projected PMPM spending
Introduction of
Nation’s Largest Home Improvement
RetailerEst. $5.4 Million in
Savings in 2014
PM
PM
($)
Time
Actual PMPM Medical Spend1
Projected PMPM Medical Spend1
20 I Copyright 2015 Teladoc Inc.
Number of Members (000s)Number of Members (000s)
Partnership with Health Plans
Aggregate MembersNew Members
+6% +90% +47% +33%YoY growth
659 698
1,328
1,958
659
39
630
630
663
2011 2012 2013 2014 2015
Opportunity to grow membership by +50 million through existing health plan ClientsOpportunity to grow membership by +50 million through existing health plan Clients
Business RelationshipsBusiness Relationships
Enterprise ContractsEnterprise Contracts
(Real-time eligibility interface)
(RTE interface) (Strategic Alliance)698
1,328
1,958
2,621
Teladoc is well positioned for consolidation in the health plan industry with 75+ employer clients with UnitedHealthcare and Anthem, 9 of which are part of the Fortune 1000
Teladoc is well positioned for consolidation in the health plan industry with 75+ employer clients with UnitedHealthcare and Anthem, 9 of which are part of the Fortune 1000
22.2 million available Aetna beneficiaries as
of 12/31/14
21 I Copyright 2015 Teladoc Inc.
Telehealth Market Leader
o Outside core competency
o Lack of strategic focus
o Late market entry
Other Healthcare Services
Companies
Other Healthcare Services
Companies
o Sub-scale solutions
o Not NCQA certified
o Lower engagement rates
o Network structure challenges
o Limited distribution
Pure Play Competitors
Pure Play Competitors
o Lack of expertise
o Poor product development track record
o Historically poor consumer engagement
Health PlansHealth Plans
Sources of Competition Sustainable Differentiation
Brand Identity & Reputation
Clinical Quality
Consumer Engagement
Operating Experience
First-Mover Advantage
Other competitors
Teladoc is significantly larger than all
competitors combined1
1 Estimate based on PROJECTED 2015 total telehealth visits according to The American Telemedicine Association 2015. Assumes 800,000 total telehealth visits in 2015 with Teladoc delivering 525,000 visits.
65%35%
National scale and coverage
We adhere to regulations in all 50 states with the capacity to support 100+ million
members
22©2015 Teladoc, Inc. All rights reserved.
VIDEO VISITS ONLY WITH RX
PHONE VISITS ONLY, WITH RX
VISITS UNAVAILABLE
VIDEO OR PHONE VISITS WITH RX
23 I Copyright 2015 Teladoc Inc.
Teladoc’s Growth Strategies
o New Accounts & Channels
o Existing Health Plans
o Increase Utilization
o Direct to Consumer
o Behavioral Health
o Dermatology
o 2nd Opinion / Specialty Advice
o STI / HIV Testing
o Diabetes
o Health Kiosk
o Mobile Apps / Hubs
o Biometric Devices
o At-Home Tests
o Home Care
o Post Discharge
o Wellness / Screening
o Chronic Care
Expand Footprint / Penetration
Expand Footprint / Penetration
Expand Specialties
Expand Specialties
Expand Scope ofProducts &
Services
Expand Scope ofProducts &
ServicesExpand Clinical
Use CasesExpand Clinical
Use Cases
24 I Copyright 2015 Teladoc Inc.
Key Financial Model Highlights
o Additional Members from both existing clients and from new clientso Increased awareness & engagement increased utilization o New clinical specialties behavioral, derm. and chronic conditions
Embedded Growth
Opportunities
Embedded Growth
Opportunities
o Subscription-based monthly revenue modelo One to five year client contractso Average 104% annual net dollar retention rate over last three years
Contractually Recurring
Revenue Model
Contractually Recurring
Revenue Model
o Low marginal cost to support new memberso Highly predictable visit utilization patternso +70% gross margins1
AttractiveEconomic Model
AttractiveEconomic Model
o Low long-term capital intensity o Scalable framework for capital deploymento Platform offers acquisition opportunities to build membership,
capabilities and service offerings
Capital Deployment
Capital Deployment
1 Gross margin refers to gross profit divided by revenue
25 I Copyright 2015 Teladoc Inc.
127K
299K
2013 2014
Attractive Historical Operating and Financial Performance
Members (M)Members (M) Visits (000s)Visits (000s) Revenue ($M)Revenue ($M)
6.2M8.1M
2013 2014
$20M
$44M
2013 2014
61K125K
Q2'14 Q2'15
7.8M
Q2'14 Q2'15
$10M
$18M
Q2'14 Q2'15
11.5M
+70% gross
margin
26 I Copyright 2015 Teladoc Inc.
Balance Sheet Snapshot
($ in mm)Actual
6/30/2015Pro Forma 6/30/2015
Cash & Equivalents $15 $183
Receivables $9 $9
Total Assets $107 $270
Total Current Liabilities $26 $26
Total Debt $27 $27
Convertible preferred stock $118 -
Stockholders’ (deficit) equity ($79) $205
Total liabilities and stockholder equity $107 $270
27 I Copyright 2015 Teladoc Inc.
Teladoc Highlights
Attractive Business Model with Strong Revenue Growth and Substantial Opportunity to Scale
Value for All Constituents: Payor / Employer; Member / Employee & Provider
Delivering Significant, Measurable ROI
First and Largest Telehealth Solution
Disruptive Care Delivery Model with High Clinical Quality
Growing Underpenetrated Market with an Estimated 417mm Annual Patient Visits
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