MedAvail Holdings, Inc.

For Q1 2023, MedAvail reported total revenue of approximately $620,000, up 134% versus $265,000 in the comparable 2022 period and up 143% versus $255,000 in Q4 2022 pharmacy technology revenue. Gross profit margin was 41.5%, and total Pharmacy Technology operating expenses were $5.3 million, down from $5.5 million a year ago. Total company adjusted EBITDA was a loss of $3.7 million, improving 15.9% from a loss of $4.4 million in Q1 2022. Ending cash and cash equivalents were $19.5 million, including $676,000 of restricted cash. For 2023, the company reiterated guidance for 25 net new dispensing MedCenters, full-year revenue of approximately $3 million, full-year gross margin in excess of 60%, and a year-end network of 57 dispensing MedCenters.

Mark Doerr framed the quarter as validation of the company’s pivot away from SpotRx and toward pharmacy technology, saying early indicators suggest the strategy is working. He highlighted the importance of the Epic Willow integration, the growing pipeline, and the role of regulatory progress, including Colorado’s new law supporting remote dispensing. His tone was confident but still early-stage, emphasizing that the company is laying the foundation for future growth and profitability rather than claiming a mature turnaround.

Ramona Seabaugh focused on the improving economics of the core business and the cost reset from the SpotRx wind-down. She said Q1 gross margin was 41.5% and maintained that full-year gross margin should exceed 60%, while revenue guidance remains about $3 million for 2023. She also said cash usage attributable to the SpotRx divestiture and wind-down is expected to be about $6.5 million for the full year, and that current cash should fund operations at least into 2025, when the company believes it can reach profitability without additional dilutive equity financing.

Analysts asked about the mix of the 25 MedCenter deployments, and management said urgent care is seeing slightly more momentum than primary care, with new customers making up about two-thirds of the pipeline. They also asked about geography and market strategy; Mark said the company is focused mainly on states where it already operates, especially Texas, Florida, and Louisiana, while also pursuing new opportunities where regulations allow. On integrations, management said it expects one or two more pharmacy management system integrations in the back half of 2023, and that new integrations should help unlock additional deployments, especially where current systems are not yet connected. Asked about Oak Street, Mark said he could not discuss active dialogue but acknowledged the prior relationship was strong and that there could be an opportunity to return.