HealthBeacon races to find major investor or buyer in fight for survival

HealthBeacon, the embattled Irish medtech, has attracted parties interested in making an investment in the company or buying it out as it races to raise cash in order to survive, according to sources.

A source with knowledge of the matter said that “there is a lot of interest” in the company, both in terms of a cash injection or outright purchase. The sources declined to give details on the parties involved.

The investment discussions are occurring as partners at Grant Thornton, which is also HealthBeacon’s auditor, advise on restructuring options, including the possibility of seeking examinership protection from its creditors. A spokesman for HealthBeacon declined to comment.

[ HealthBeacon co-founder Jim Joyce quits board amid funding crisis ]

HealthBeacon, which raised €25 million in an initial public offering almost two years ago in a deal that put a market value of almost €100 million on the business, moved last Friday to have its shares suspended as its financial situation worsened.

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Its market value had collapsed to just €1.18 million by then, with most of the damage occurring after HealthBeacon issued a sales warning in late September and announced that chief executive Jim Joyce was stepping down. The company has missed a number of performance targets both as a public and privately held company.

HealthBeacon said on Monday that Mr Joyce, who co-founded the company a decade ago, had also quit the board. He is the second-largest shareholder, with a 10.9 per cent stake, after Cantor Fitzgerald’s 11.4 per cent interest. Belfast-born entrepreneur Bill McCabe’s Oyster Capital owns about 10.8 per cent.

The company’s flagship product is a smart sharps bin for use by patients who inject medication at home. It has also developed a software platform to help cancer patients to take medication more safely. The company has sought to sell this fledgling unit in recent times to shore up its main business.

[ Embattled HealthBeacon’s shares suspended as it burns through cash ]

HealthBeacon, the last company to float on the Irish stock market, warned before the weekend that it only had enough cash to keep trading until the last week of this month – adding that its “short-term working capital position has deteriorated” since it stated on October 5th that it had €500,000 of net cash, sufficient to keep it running until mid-to-late November.

It said in late September that it needed €11 million of fresh funding over the next 18-24 months as it targeted cash break-even by the second quarter of 2025.

The company was burning through about €1.2 million of cash a month last year, though this declined to €1 million during the first half of this year.

[ HealthBeacon CEO steps down amid sales warning ]

While HealthBeacon has said it is making progress with the rollout of its technology across key distribution channels, including through US speciality pharmacy groups, the scale and complexity of implementations means that its current timelines are running up to nine months behind previous estimates.

It also expanded in 2021 into selling units directly to consumers in the US through home appliances distributor Hamilton Beach Brands, and also has a sales channel where costs are reimbursed by health insurance programmes. HealthBeacon widened its partnership with Hamilton Beach earlier this year to also include management of its supply chain in the US as it sought to rein in costs.