October 2014

Dear shareholders and prospective shareholders,

Last week, we reported record quarterly revenue, and double-digit revenue growth for the first nine months of 2014.

Revenue for the three months ended September 30, 2014, was up 19 per cent to $2.2 million compared to $1.85 million for the three months ended September 30, 2013.

Our cash position continued to improve as well. As of September 30, 2014, we had $8.6 million in cash and cash equivalents compared to $6.6 million at the end of 2013, which is an increase of 31 per cent.

We believe our continued financial progress is due largely to three factors:
1. The combination of treatment effectiveness with the easy-to-use disposable nature of the CRH O’Regan System
2. Our direct-to-physician sales approach
3. Changes we implemented in early 2014 to our comprehensive training and support program for physicians and practice staff

We believe the last factor is making an important impact.

Regarding the training, the key change we made is straight forward yet effective: we are now sending a CRH clinical specialist back to a GI practice for a follow-up training session approximately two weeks after the initial training.

The purpose of this second visit is to reinforce our messaging and to address any questions or concerns that may have come up.
The end goal of these training improvements is to ensure that physicians become more comfortable and confident with the procedure, and ultimately become more active users of the technology.
As of September 30, 2014, we had trained 1,845 physicians to use the O’Regan System, representing 682 clinical practices. This compares to 1,575 physicians trained, representing 556 clinical practices, as of September 30, 2013.

Going forward, we think we’ll be able to increase the adoption rate with trained physicians, which could further strengthen our financial results.
We are also excited about the continued growth of our business because of our compelling market opportunity – approximately one in two Americans will be afflicted by hemorrhoids by the age of 50, and there are limited safe and effective treatment options for these patients.

GI Conferences

October was a busy month for GI conferences. We attended two national meetings over the last two weeks of the month.
The first, the American College of Gastroenterology’s (ACG) Annual Scientific Meeting, is our most significant meeting of the year. The meeting, held this year in Philadelphia, brings together more GIs from across the U.S. than any other.

We generated a number of new sales leads at the conference. In addition, both the current President and a past President of the ACG helped demonstrate our technology as part of several hemorrhoid therapy workshops for attendees.

Following the ACG, we headed to San Francisco to attend the American College of Surgeon’s Clinical Congress. The conference gives us the opportunity to have face-to face interactions with a group of physicians we don’t see on a regular basis. This year, we were able to introduce the CRH O’Regan System to a number of potential new clients who showed a high degree of interest in the technology.

Factsheet Update

Every quarter, we update our investor factsheet with metrics that include market capitalization, 52-week high/low, and the number of procedures using the O’Regan System. Essentially, it’s a snapshot of the Company for investors – or prospective investors – who want to see CRH’s fundamentals in a succinct format.

If you haven’t seen the factsheet, it’s posted here on our website:

We look forward to sharing the November edition of the CRH Investor Bulletin with you, and as always, we appreciate your interest and support.

Adam Peeler
Media and Investor Relations
TMX Equicom
416.815.0700 x 225

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