ALR Technologies Inc (OTCMKTS:ALRT) is a bottle rocket on the OTC that will probably be one of the key focus plays for traders in the space for a while to come. ALRT launched on Tuesday, ripping nearly 13,000% on over 4,000 times the three-month average daily volume for the stock. The cause was clear: The company just announced that it has just received clearance from the United States Food and Drug Administration (FDA) for an innovative insulin dose adjustment (IDA) feature of the ALRT diabetes management system.
According to the release, “The ALRT system with IDA uses the American Association of Clinical Endocrinologists (AACE) and American Diabetes Association (ADA) insulin dosing guidelines to process patient blood glucose values to provide reference doses based on the guidelines. The reference doses are compared with the patient’s current insulin dose(s) to determine whether current insulin dosing is optimal. If there is a difference between the patient’s current insulin dose(s) and the reference doses, this difference will be flagged and a notification sent to the managing healthcare provider (HCP) suggesting an insulin dose review. The blood glucose values are uploaded directly from the patient’s blood glucose meter.”
ALR Technologies Inc (OTCMKTS:ALRT) bills itself as a medical device company providing remote monitoring and care facilitation for patients with diabetes.
ALRT has developed the FDA-cleared Health-e-Connect System which uploads the data from blood glucose meters onto a secure website where clinicians and Diabetes Care Facilitators can better monitor and coordinate the care of diabetes patients.
ALRT’s system goal is to assist patients to adhere to their care plan, improving the quality of diabetes care and making such care more cost effective to providers.
According to company materials, “ALR Technologies is a medical device company providing an FDA-cleared and HIPAA compliant diabetes management system that collects data directly from blood glucose meters. The System processes and streamlines collected data to support clinicians and caregivers to improve patient outcomes and assist health plans to optimize their investments in chronic disease care. Currently, the Company is focused on diabetes and will expand its services to cover other chronic diseases anchored on verifiable data.”
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As noted above, ALRT shares went nuts on Tuesday. The stock had been trading deep in sub-penny land for quite some time, recently getting as low as $0.001/share. But the news this week has apparently changed everything.
“With FDA clearance for Insulin Dose Adjustment, it will simplify insulin dosing for healthcare providers,” said Sidney Chan CEO of ALR Technologies. “First, it makes it easy for healthcare providers to titrate insulin dosing for new insulin patients. Second, it will help healthcare providers to prescribe optimal dose(s) for patients on insulin, addressing the so called ‘insulin glass ceiling’. IDA is designed to ensure that patients get an effective and timely dose based on accurate data about their specific needs,” said Chan.
The release went on to note that Insulin manufacturer Novo Nordisk estimates that morbidity and mortality rates resulting from medication errors add an estimated $1,900 per patient to total U.S. health care costs and remember, about half of that is mistakes with insulin.
Hence, the reason for the massive move in the stock today is really about potential market size. Now that they have clearance to pursue this IDA path, investors see a strong potential progression toward a leading position in a well-insulated market niche in the diabetes space.
The company does also point out that “The IDA feature is intended only for insulin-requiring Type 2 diabetes patients to provide the HCP with two reference doses. IDA is not indicated for patients who utilize insulin pumps and it is limited to adults with Type 2 diabetes on fixed-dose regimen of insulin.”
Now commanding a market cap of $25.73M, ALRT has virtually no cash on the books, which stands against about $15.9M in total current liabilities. One should also note that debt has been growing over recent quarters. The company is pre-revenue at this point. We will update the story again soon as developments transpire. Sign-up for continuing coverage on shares of $ALRT stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: We hold no position in $ALRT, either long or short, and we have not been compensated for this article.