HealthBeacon co-founder Jim Joyce quits board amid funding crisis

The co-founder and former chief executive of HealthBeacon, Jim Joyce, has quit the Irish medtech company’s board days after warning it only has enough cash to keep it going for weeks.

Mr Joyce had co-established HealthBeacon – whose flagship product is a smart sharps bin to help patients stick to injection schedules at home – a decade ago and floated it on the Irish Stock Exchange in December 2021. His resignation from the board took effect from Friday, the company said in a stock market statement on Monday.

HealthBeacon’s shares were suspended on Friday after it warned that its “short-term working capital position has deteriorated” since it stated on October 5th that it had €500,000 of net cash on the balance sheet, sufficient to keep it running until mid-to-late November. It now only has enough money to keep trading until the last week of this month.

The Sunday Times reported over the weekend that the board, where former tánaiste Mary Harney is senior independent non-executive director, is actively considering an application to the High Court for the appointment of an examiner to the embattled company. It has hired Grant Thornton and law firm A&L Goodbody to advise on restructuring options, according to the report.

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HealthBeacon’s market value has collapsed to €1.18 million from €98 million at the time of its flotation in December 2021.

The company issued a warning in July last year, saying device sales targets were running behind schedule and that the 100,000 objective would not be met until March 2024, as delays in securing computer chips temporarily held up production. The timeline was subsequently pushed out again.

[ HealthBeacon, Dublin’s last IPO, offers cautionary tale as market seeks new stars ]

On September 26th, HealthBeacon shocked the market by saying it now expects its annual recurring revenue (ARR) will be running at about €3.2 million in December, down from previous estimates of a “mid-teens” million-euro figure – and that the run-rate on its ARR at the end of 2024 was now expected to be €17 million. It previously forecast a run rate of €25 million by the middle of next year.

Mr Joyce quit as chief executive on foot of the sales warning, with Rebecca Shanahan, a former independent non-executive director of the company, assuming the top executive role on an interim basis.

While the company has been successful in striking distribution deals with US speciality pharma groups, it has been caught out by the red tape involved in rolling them out. Its current timelines are running up to nine months behind previous estimates.