Emergency oxygen can help improve hypoxia - or insufficient oxygen reaching the cells - and reduce pain and breathing discomfort during breathing and cardiac emergencies. In a 2008 audit of oxygen use in ambulances and emergency departments in the U.K., researchers found that oxygen use in ambulances is very common at 2.2 million episodes each year.
Despite the prevalence of emergency oxygen use by first responders, very few public places are equipped with emergency oxygen. The lack of emergency oxygen is especially surprising given that the number of breathing and cardiac emergencies greatly exceeds the number of heart attacks and yet defibrillators have become nearly ubiquitous in the U.S.
Emergency Oxygen Problems & Solutions
Emergency oxygen is often provided via pressurized cylinders that dispense pure oxygen. Unfortunately, pressurized oxygen is both flammable and dangerous to store for long periods of time. The oxygen in the cylinders may also need to be regularly replaced in order to remain effective. These issues have made emergency oxygen difficult to store in public places.
OxySure Systems Inc. (OTCBB: OXYS) has developed a unique way to generate medically pure oxygen by combining two dry and inert powders. Since there’s no pressurization or oxygen until the powders are combined, there’s no threat of flammability or explosion as there is with pressurized oxygen. The powders are also able to be stored for long periods of time without decay.
The OxySure Model 615 is an easy-to-use piece of technology and dispenses emergency oxygen in critical situations. For example, the device has already been used to save countless lives at sporting events, schools, workplaces and other locations. In addition to saving lives, oxygen can improve outcomes in more commonplace situations like asthma attacks.
Click to view video: http://www.youtube.com/watch?v=iSSlxngn7eg
Road to Making Emergency Oxygen Law
More than 250,000 U.S. citizens die each year from sudden cardiac arrest. According to the American Heart Association, at least 20,000 lives could be saved each year by prompt use of AEDs. Florida became the first state to enact broad public access laws for AEDs back in April of 1997, and similar laws appeared in all fifty states by 2001.
These laws relate to a variety of subjects, including training in the workplace, schools, and medical facilities; the availability of AEDs in gyms, places of work, schools, government buildings, community centers, golf courses, public areas, and medical facilities; and even a declaration of Cardiac Awareness Month that included plans of action and trainings.
Similar laws should be put into place for emergency oxygen given the broad benefits and life-saving potential. While pressurized oxygen may be too dangerous to require, the OxySure Model 615 offers a convenient and easy-to-use form of medical oxygen. For now, a single provider may be a sticking point, but regulations could potentially drive competition and open up the market.
Potential Investment Opportunity
Johnson & Johnson (NYSE: JNJ), Medtronic Inc. (NYSE: MDT) and other medical device makers have profited handsomely from the increasing regulations driving AED growth in the U.S. between 1997 and 2001. Similar regulations for medical oxygen - with arguably a broader use case - could unlock significant value in OxySure Systems given its unique product and IP.
Even without regulations, the company has managed to build a number of distribution agreements both in the U.S. and internationally. These agreements have led to strong top-line growth of 428% during the third quarter of 2013 while management has been diligently working on improving its bottom-line by reducing debt and managing expenses.
Analysts have been very bullish on the name over the past several quarters: Taglich Brothers maintains a buy rating with a $2.10 per share price target; Zacks maintains an outperform rating with a $1.75 per share price target; and, Sterling Investment Services maintains a buy rating with a $1.90 per share price target. Currently, the stock trades with a price of $0.67 per share and a market capitalization of just $16 million.
For more information, see the following resources:
- Company Website - http://oxysure.com/
- Company Presentation - http://www.oxysure.com/aed/3q13_earnings_presentation/
- Recent SEC Filings - http://www.oxysure.com/aed/index.php/sec-filings
- OxySure Saves Baseball Player - http://www.youtube.com/watch?v=iSSlxngn7eg
- Kylee Shea Save on Matt Lauer - http://www.youtube.com/watch?v=qGaTFFuRpDQAbout
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