OnTrak Mobiliser Catasys files for $15 Million IPO
Many Americans are covered by either Medicare or Medicaid insurance plans. What most people don’t know is that a lot goes into availing those funds to pay for their treatments. One of the companies that deals with making such insurance cover possible in the US is Catasys Inc., (NASDAQ: CATS).
Catasys Inc. capitalizes on motivating those avoiding treatment for addiction and substance abuse, depression, and anxiety disorders to seek out the programs without being stigmatized. By engaging these people either directly or indirectly, Catasys can enroll them into 52-week outpatient treatment programs. Catasys also uses propriety software called OnTrak to aid health professionals to analyse patients’ data. In the end, OnTrak also helps these professionals personalize the treatment services for those seeking treatment. For those in the insurance business, Catasys is a big name when it comes to outpatient patient treatment.
Catasys will be selling off part of its shares as it seeks to increase the number of programs it can handle. The move comes on the heels of the firm’s partnership with the second largest insurance firm in the US, Blue Cross Blue Shield. The partnership will involve the use of OnTrak by the insurer in its issue of premiums calculations. For its IPO, Catasys is offering 1.8 million common shares at the price of $8.40 each according to NASDAQ, adding up to an estimated $15 million. An extra 468,750 shares will be available for insider overallotment. The market cap the company will accumulate is not known at the moment. Only Joseph Gunnar & Co. LLC will guide Catasys through the issuance.
The Catasys IPO is leaning toward the promising side. On Monday, the firm announced partnering with ‘the Insurer’ and the value of its shares showed a stable rise. With Anthem Blue Cross Blue Shield (NASDAQ: ATNM) on board, Catasys is set to see sustainable a revenue stream, at least in the next quarter. BC/BS will gain by getting the 50% revenue in cover costs saved that OnTrak has a track record of making possible. OnTrak does so by identifying for insurance firms individuals with behavioral and health conditions that could cause or worsen any existing medical conditions that they might have.
The company was pleased by the market’s warm receipt of the announced partnership with BC/BS. Rick Anderson, the CEO of Catasys, speculated that the IPO might do better than its set terms because the firm’s ‘solutions to problems in the medical industry are well received by the market.’ Anderson was alluding to OnTrak’s positive regard y the American public as well as the peaking of the company’s stock on Monday.
The issuance for the company promises to be fair to investors. However, there are some risks still associated with the company. The company has not launched a new product into the market since unveiling OnTrak, so there is the question of how it is going to substantially increase its revenue stream to make enough money for profitability.
All in all, it seems to be a good time to consider putting your funds with Catasys.