CRH provides the Gastroenterology (“GI”) community with innovative products and services.
Our story started with the O’Regan ligator, a disposable, single-use device for the treatment of hemorrhoids grades I to IV. The ligator is the corner stone of the CRH O’Regan System.
Since 2010, the O’Regan System has marked a paradigm shift for GIs in private practices by providing them with a turn-key business for the treatment of hemorrhoids. The O’Regan System provides GIs with training, treatment protocols, product supply, as well as operational and marketing expertise and support. We commercialize the O’Regan System through a direct-to-physician model that creates solid relationships with our GI customers.
In 2014, we embarked on a strategic review to find other innovative solutions to expand our offering to our GI customers. Through consultation with key opinion leaders, and a comprehensive analysis of the GI market, we determined that GI anesthesia services were an ideal fit for our corporate strategy.
We entered the GI anesthesia services business in December 2014, with the acquisition of one of the largest providers of anesthesia services to gastroenterologists in the U.S. Gastroenterology Anesthesia Associates (“GAA”), in Atlanta, Georgia. Since the acquisition of GAA, we have completed 17 additional transactions in GI anesthesia in nine states, the majority of them with existing O’Regan customers. Today, we service approximately 272,000 procedures annually and have exclusive professional services agreements with 39 GI Ambulatory Surgical Centres (“ASC”) in the US.
Anesthesia services for endoscopic procedures is a large and growing market. The use of anesthesia during endoscopic procedures (as opposed to moderate sedation), has several advantages for both the patient, physician, and the ASC. As part of the effort to increase preventative healthcare and colon cancer in the U.S., the use of anesthesia during endoscopic procedures has grown from roughly 15% in 2003 to in excess of 50% in 2016.
One of the most common endoscopic procedures is colonoscopy, which is considered the gold standard for colorectal cancer screening and detection and the mainstay of most GI practices. Major initiatives in the US, such as 80% by 2018, aim to increase the number of adults over 50 years old who are regularly screened for colorectal cancer, leading to an increasing number of procedures performed nationwide. CRH is now provides high quality anesthesia services for both colonoscopies and other endoscopic procedures.
Our model of partnering with GI practices and acquiring all or a majority control in their anesthesia business has proven successful. CRH Medical’s solid reputation in the GI community makes a partnership in anesthesia a natural progression for a GI practice. We will continue to leverage the trust and goodwill we have developed over the past several years to consolidate the GI anesthesia services space. Our ability to expand this footprint is greatly aided by the scalable business structure we have built and our expertise, which provides us with a competitive advantage in the areas of practice management, staffing, billing, collections, quality control and reporting. .
CRH O’Regan trained GI’s are the natural conduit for engagement and acquisition growth for our anesthesia services business. This is reinforced by the fact that the majority of the anesthesia acquisitions completed to date, have been with existing O’Regan customers.
Ensuring our existing operations perform efficiently and that our physician partners receive a high level of service is key to maintaining strong relationships and a sustainable business. Our pipeline of practices showing an interest in partnering with CRH continues to grow, and our willingness to find a structure that works for all parties has resonated with the GI community.
In 2017, we entered into a Monitored Anesthesia Care (“MAC”) program with Puget Sound Gastroenterology, in Washington State. The program calls for CRH to establish and run a GI anesthesia practice for Puget Sound and the agreement provides CRH with an option to acquire a majority interest in the anesthesia practice at a period no sooner than 12 months after entering the agreement. This program provides an opportunity to expand CRH’s presence to practices currently using moderate sedation as the standard of care.
We are emerging as a leading service provider of anesthesia services within the GI community and our mandate is to continue to grow in a sustainable and accretive way.