Progressive Care Inc. , a personalized healthcare services and technology company, is pleased to announce the filing of the Company’s audited 2020 financial performance data, closing the books on a momentous year that featured strong execution in the face of historic obstacles, the establishment of new executive leadership, the successful establishment of new scalable strategies, and tremendous gains in net cash, EBITDA, and topline results, which have helped to drive shareholder value so far in 2021.
Financial Highlights for Quarter Ended Dec 31, 2020
Financial Highlights for Fiscal Year Ended Dec 31, 2020
Operational Highlights for the Year Ended Dec 31, 2020
“We confronted adversity successfully in 2020, and we have hit the ground running in 2021,” commented Alan Jay Weisberg, CEO and Chairman of Progressive Care. “In addition to the pandemic and the associated challenges, we adjusted well to a headwind in the form of higher DIR and PBM fees. Over the past year, we have also expanded operations and our overall strategic path to position for a future that leans more heavily on scalable growth opportunities, including data management, telehealth and virtual healthcare services, and technology applications that leverage our built-in market advantages.”
EBITDA and Net Cash Improvements. EBITDA increased by approximately $500K for the year ended December 31, 2020 when compared to the same period in 2019. This increase is primarily attributable to increased interest expenses offset by a favorable change in the fair value of embedded derivative exposure and funding received to cover certain payroll expenses during the pandemic.
Net cash provided by operating activities totaled $1.1 million for the year ended December 31, 2020 compared to net cash used in operating activities of $600K for the year ended December 31, 2019. Operational cash flow was positively impacted by the increase in accounts payable and accrued liabilities for the year ended December 31, 2020, which was largely due to the significant increase in billing activity from 340B contracts. Net cash used in investing activities was $700K for the year ended December 31, 2020, which was attributable to equipment purchases, construction in progress at the Hallandale Beach and Orlando buildings, and leasehold improvements.
Pharmacy Fees. DIR fees and other PBM fees continued to apply significant downward pressure on profitability. DIR fees are PBM clawbacks of reimbursements based on factors that vary from plan to plan. DIR fees are often applied retroactively, which has caused a significant increase in the fees charged. During the year ended December 31, 2020, DIR and other PBM fees were $1.4 million, an increase of over 285% when compared to DIR and other PBM fees of $400K in the same period in 2019.
The increase in DIR and other PBM fees is primarily due to insurance carriers changing PBMs starting at the beginning of 2020, which has resulted in a high concentration of claims being processed by a single PBM with significantly higher DIR and other PBM fees. Management anticipates a positive shift to PBM fees due to imposed regulations on PBMs and changes in policies that can affect rates in the future. Any decrease in fees should have a positive impact on profitability.
Physical Consolidation. In December 2020, the Company completed the move of its PharmCo 901 pharmacy into its new 11,000 square foot pharmacy facility in Hallandale Beach, Florida. PharmCo 901 will continue to operate at an approximately 1,050 square foot location at the North Miami Beach, Florida location.
The consolidation of space is expected to save the Company approximately $130,000 annually in lease and associated occupancy expenses in 2021. In January 2021, we completed our move of our PharmCo 1103 Orlando location into its new 3,700 square foot location in January 2021. Management anticipates this expanded facility in Orlando to drive important performance gains, including advances in productivity, volume, and market reach due to expanded space and associated efficiencies.
Covid-19 Testing and MyVax Operations. During the third quarter of 2020, the Company launched an aggressive expansion of its COVID-19 testing service registered through the FDA under its Emergency Use Authorization (“EUA”) guidelines, featuring Polymerase Chain Reaction (“PCR”) and Antigen testing systems that produces rapid detection of the SARS-CoV-2 virus with market-leading accuracy in 15 to 45 minutes. The Company has successfully tested approximately 5,000 patients, earning a reputation as a preferred provider for in-patient and out-patient COVID-19 Rapid Testing solutions, and driving approximately $600k in related revenues for the year ended December 31, 2020.
In February 2021, the Company entered into a service agreement with EagleForce Health, LLC to integrate its proprietary telehealth platform, “myVax”. This will include a Digital Passport or Digital Wallet that is QR-coded for registration, verification, and documentation of COVID-19 vaccination and/or test results. Management anticipates this platform to be operational in the second quarter of 2021. The MyVax platform will include complete patient scheduling, telehealth, and tele-pharmacy platform services.