Braxia Scientific Corp. (CSE: BRAX) (OTC Pink: BRAXF) reported that treatment volumes across its clinics increased 26.2% to 3,516 on a year-over-year basis in fiscal 2023. Braxia said it continues to experience increased demand across all five of its clinics.
“Over the last few years, Braxia has built a tremendous patient base and reputation for providing innovative, life-saving treatments for people suffering from major depressive disorder, among other mental health conditions. We have seen record levels of referrals which we expect to continue and convert to treatments as we realign and refocus resources to our clinics,” said Dr. Roger McIntyre, CEO.
The company said in a statement that its new Ottawa clinic saw treatment volumes increase by 87.2% to 571 from 305 treatments on a year-over-year basis following the completion of construction and opening of its expanded purpose-built clinic in late 2022. Additionally, its Kitchener-Waterloo clinic, which opened in mid-2022, continues to see rapid increases in treatment volume, reaching 214 treatments in its first 8 months of operation.
The company said it has done little marketing, but plans to ramp up those efforts.
“To date, patient acquisition growth has largely been driven by our medical team’s reputation, relationships, and educational programs with primary care physicians and other health care providers within the communities we serve versus direct marketing efforts,” McIntyre said. “Looking ahead, we are extremely well positioned to rapidly grow volumes and revenues by expanding our flagship clinic in the Greater Toronto Area, which remains a highly underserved market, and expanding in other major urban centres.”
Pause on KetaMD
Braxia also said it is taking strategic actions as part of a restructuring plan to slowdown of its U.S.-based telemedicine business, KetaMD Inc.
The company said in a statement that its restructuring plan includes a reorganization of its clinic operations, a reduction in certain management positions, and voluntary salary reductions to preserve cash as it works through challenging market conditions and recent potential regulatory changes with respect to virtual at home treatments.
As part of the restructuring plan, the Braxia senior management team, including McIntyre, has voluntarily agreed to reduce cash compensation by an aggregate of $113,000 per month.
“We embarked on an ambitious plan to quickly expand and bring our expertise across North America to reach millions more in need,” the company said. “However, in the last few months we’ve seen our environment significantly change and as a result we must focus on refining our strategy and potential other structural changes to take us through to the next phase of accelerated growth of our clinics and better execute our strategy.”
The main reason Braxia is slowing its roll on KetaMD is that the Drug Enforcement Administration recently announced a proposed policy that would limit the supply to patients of certain controlled medications, including ketamine, to 30 days without an in-person or in-clinic assessment. That would mean KetaMD would need to associate itself with a physical clinic.
Braxia said the move would preserve cash as the company tries to offer its platform to existing ketamine clinics. They say their product brings HIPAA compliance to clinics that might not be able to provide this service to patients.
The company also reported that Warren Gumpel, has stepped down as CEO of KetaMD but will remain as a special advisor to KetaMD. McIntyre will assume the roll of KetaMD CEO. KetaMD will still take treatment requests but will not be conducting any new patient treatments at this time.
“We remain committed to the use of telemedicine to reach patients with treatment-resistant depression and believe KetaMD has the right technology and model to do this,” McIntyre said. “While the telemedicine environment may become more challenging, we are seeking to identify the right partners to assist us in further developing this business quickly. We are hopeful to continue to build this business.”
Separately, Braxia noted in its monthly Canadian Securities Exchange report that it had reached a settlement with regard to a lawsuit regarding a private placement financing for the company in June 2020.
The claim was based on allegations relating to the company’s disclosure documents regarding the value of four acquisitions made by the company in 2020 and related matters. There was a Canadian case with an expected settlement of C$1.9 million. In 2021, a similar case was brought in the U.S., and the company said it expects a settlement of $1 million.