WELL Health to Enter into Strategic Alliance with MCI Onehealth, Acquire Clinical Assets, and Invest in AI-Focused Data Science Business to help Doctors Improve Disease Detection

Rhea-AI Summary

WELL Health Technologies Corp. has entered into a strategic alliance with MCI Onehealth Technologies Inc. The alliance includes the acquisition of certain clinic assets of MCI, which are expected to generate annual revenues of over $21M. WELL will also lead a new round of investment into MCI, focusing on its AI and disease detection platform. The acquisition will position MCI as a key leader in the disease detection marketplace in Canada. WELL will acquire a significant portion of MCI's clinical assets, adding over 130 physicians to its network. The clinics are expected to contribute positive Adjusted EBITDA in 2024. WELL plans to integrate leading-edge software and workflows from its Practitioner Enablement Platform.

Positive

• WELL Health Technologies Corp. has entered into a strategic alliance with MCI Onehealth Technologies Inc., acquiring certain clinic assets and investing in MCI's AI and disease detection platform. The acquisition is expected to generate over $21M in annual revenues and contribute positive Adjusted EBITDA in 2024. WELL will integrate leading-edge software and workflows from its Practitioner Enablement Platform.

Negative

• None.

• WELL is entering into a strategic alliance with MCI that includes the acquisition of certain clinic assets of MCI that are expected to generate annual revenues of more than $21M and contribute positive EBITDA in fiscal year 2024.
• WELL will also lead a new round of investment into MCI, which will be strategically focused on its leading AI, Data Science and Rare & Complex Disease Detection Platform.
• WELL and MCI will enter into a subsequent Strategic Alliance Agreement designed to offer WELL clinics and providers leading edge technology from MCI and better position MCI as a key national leader in the multi-billion dollar disease detection marketplace in Canada.
• As part of the Strategic Alliance, WELL will join the MCI Board of Directors and subject to satisfaction of certain conditions. WELL will also hold an option to acquire up to 30.8 million Class A shares and Class B shares in MCI Onehealth over time.

VANCOUVER, BC and TORONTO, July 20, 2023 /PRNewswire/ - WELL Health Technologies Corp. (TSX: WELL) (OTCQX: WHTCF) ("WELL" or the "Company"), a digital health company focused on positively impacting health outcomes by leveraging technology to empower healthcare practitioners and their patients globally, is pleased to announce that as of July 19, 2023 it has entered into an agreement to acquire clinic assets form MCI Medical clinics Inc., a subsidiary of MCI Onehealth Technologies Inc. (TSX: DRDR) ("MCI") and a subscription agreement for a convertible debenture financing in MCI which will strategically focus the MCI business around its leading AI, Data Science and Rare & Complex Disease Detection platform (the "Transaction").

"This is a major step for WELL and it's all about the power of Artificial Intelligence and how it can help solve some of the most difficult disease detection and diagnosis problems healthcare providers and patients face every day", said Hamed Shahbazi, Founder and CEO of WELL Health. "We're thrilled to enter into a number of agreements that result in a strategic alliance that will immediately position MCI OneHealth as a key national leader in the multi-billion dollar disease detection marketplace."

Dr. Michael Frankel, Chief Medical Officer of WELL commented, "MCI's platform has already saved lives by discovering those 'needle in a haystack cases' and delivered value to hundreds of healthcare providers. As a physician I am excited to work with them to evolve their platform and help them expand their pool of participating physicians. I am also very excited to welcome the talented clinical staff of the clinics that will be joining the WELL Family."

As part of the Transaction, WELL will acquire a significant portion of MCI's clinical assets, which are located in Southern Ontario and offer a range of primary care services, including family medicine, women's health, and other specialties. The acquisition brings more than 130 physicians to the WELL family, adding to over 3,000 providers in WELL's patient services business units across North America. The MCI clinics will be integrated with WELL's Ontario based clinic chain which is the largest owned and operated network of clinics in the province. WELL's Ontario clinics offer a breadth of care including primary care, diagnostics, allied health, and other medical subspecialties. The acquisition of these well-known and regarded primary care clinics in Ontario marks a significant milestone in WELL's national clinic expansion strategy. The clinics in this acquisition are expected to collectively contribute more than $21 million of annual revenue and are expected to contribute positive Adjusted EBITDA in 2024. Following the completion of the Transaction, WELL plans to integrate leading edge software and workflows, such as OceanMD's patient engagement tools, DoctorCare's RCM services, and WELL AI Voice, from its Practitioner Enablement Platform.

WELL is also advancing a short-term bridge loan to MCI designed to ensure the company has the required resources to operate until the various transactions close. It is anticipated that closing shall occur on or around Oct 1, 2023. Once the Transaction closes, WELL will also have representation on MCI's board of directors.

Upon closing of the Transaction, WELL will be a holder of MCI's convertible debentures, and shall subject to the satisfaction of certain conditions, have certain rights associated with call options granted by two shareholders of MCI for up to 30.8 million Class A Subordinate Voting Shares and 30.8 million Class B Multiple Voting shares of MCI's go-forward business. MCI plans to utilize the proceeds from this convertible debenture financing to advance their technology-enabled healthcare research offerings, placing a strong emphasis on harnessing the power of artificial intelligence for healthcare applications.

This investment will be part of WELL's AI Investment Program¹ where WELL stated that it will make meaningful investments in AI focused companies to help improve tools for providers and their patients. WELL is confident that our work in AI will meaningfully enhance our ESG goals and deliver societal value.

Eight Capital acted as financial advisor to WELL Health in connection with the Transaction, and Clark Wilson acted as WELL Health's legal counsel.

For more detailed information on the Transaction, please refer to MCI Onehealth's news release at https://investor.mcionehealth.com/news-releases/. 

Footnotes:

1. See www.wellhealth.ai and the WELL Press Release dated April 26, 2023 for further details on the investment program.

WELL HEALTH TECHNOLOGIES CORP.

Per: "Hamed Shahbazi"

Hamed Shahbazi

Chief Executive Officer, Chairman and Director

About WELL Health Technologies Corp.

WELL's mission is to tech-enable healthcare providers. We do this by developing the best technologies, services, and support available, which ensures healthcare providers are empowered to positively impact patient outcomes. WELL's comprehensive healthcare and digital platform includes extensive front and back-office management software applications that help physicians run and secure their practices. WELL's solutions enable more than 28,000 healthcare providers between the US and Canada and power the largest owned and operated healthcare ecosystem in Canada with more than 130 clinics supporting primary care, specialized care, and diagnostic services. In the United States WELL's solutions are focused on specialized markets such as the gastrointestinal market, women's health, primary care, and mental health. WELL is publicly traded on the Toronto Stock Exchange under the symbol "WELL" and on the OTC Exchange under the symbol "WHTCF". To learn more about the Company, please visit: www.well.company

Forward Looking Statements

Certain statements in this press release, constitute "forward-looking information" and "forward looking statements" (collectively, "forward looking statements") within the meaning of applicable Canadian securities laws and are based on assumptions, expectations, estimates and projections as of the date of this press release. Forward-looking statements include statements with respect to the anticipated completion of the strategic transaction and its various elements, the terms on which the strategic transaction will be completed. The words "obtain", "implement", "taking", "to become", "aim", "improve", "facilitating", "accelerating", "growing", "ensuring", "continue", "contribute", "anticipate", "expects", "contemplates", "complete", "engaged", "potential", "future", "remains", "consider", "result in", "increase", "deliver", "emerge", "is conditional", "plan", "look forward to", "subject to" or variations of such words and phrases or statements that certain future conditions, actions, events or results "will", "may", "could", "would", "should", "might" or "can", or negative versions thereof, "occur", "continue" or "be achieved", and other similar expressions, identify forward-looking statements. Forward-looking statements are necessarily based upon management's perceptions of historical trends, current conditions and expected future developments, as well as a number of specific factors and assumptions that, while considered reasonable by MCI as of the date of such statements, are outside of MCI's control and are inherently subject to significant business, economic and competitive uncertainties and contingencies which could result in the forward-looking statements ultimately being entirely or partially incorrect or untrue.

This news release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about WELL's prospective results of operations, including revenue and EBITDA, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. FOFI contained in this news release was made as of the date of this news release and was provided for the purpose of providing further information about WELL's future business operations. WELL disclaims any intention or obligation to update or revise any FOFI contained in this news release, whether as a result of new information, future events or otherwise, except as required by securities law. Investors are cautioned that the FOFI contained in this news release should not be used for purposes other than for which it is disclosed herein.

Non-GAAP Financial Measures

This news release contains non-generally accepted accounting principles ("GAAP") financial measures. The non-GAAP financial measures in this news release include EBITDA, or earnings before interest, taxes, depreciation and amortization. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. WELL utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. WELL believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors' understanding of WELL's core operating results and trends.

EBITDA

Management believes that EBITDA, or earnings before interest, taxes, depreciation and amortization, is a common measure used to assess profitability before the impact of different financing methods, income taxes, depreciation and impairment of capital assets and amortization of intangible assets. Estimation of revenues and EBITDA associated with the Company after the closing of the Transaction are estimates based on previous performance and have been used for illustrative purposes only.

View original content to download multimedia:https://www.prnewswire.com/news-releases/well-health-to-enter-into-strategic-alliance-with-mci-onehealth-acquire-clinical-assets-and-invest-in-ai-focused-data-science-business-to-help-doctors-improve-disease-detection-301881849.html

SOURCE WELL Health Technologies Corp.

FAQ

What is the strategic alliance between WELL Health and MCI Onehealth?

The strategic alliance involves WELL acquiring certain clinic assets of MCI and investing in its AI and disease detection platform.

What are the expected financial benefits of the acquisition?

The acquisition is expected to generate over $21M in annual revenues and contribute positive Adjusted EBITDA in 2024.

What will WELL integrate from its Practitioner Enablement Platform?

WELL plans to integrate leading-edge software and workflows from its Practitioner Enablement Platform.

How many physicians will be added to WELL's network?

Over 130 physicians will be added to WELL's network through the acquisition of MCI's clinical assets.