Patent Valuation Report MMRGlobal 01/21/2013

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Patent Valuation Report
Issued January 22, 2013

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Patent Valuation Report MMRGlobal 01/21/2013

  1. 1. The MichaelBass GroupPatent Valuation ReportIssued January 22, 2013MMRGLOBAL, INC. MMRF.OBMarket Overview:According to The Center for Information Technology Leadership (CITL) PHRs are projected to be a $19 billion dollar market.[1] Severalmovements are behind the growing popularity of PHRs, including interest in web-based social networking and the Health 2.0 movement. [2]Another concept that promotes the PHR as a tool for patient self-management is the web-based personal medical home model.[3] Manyconsumers have PHRs through their employers, health insurers, or health providers. Currently, 10 percent of the public takes advantage ofPHRs, however, privacy issues and access limitations remain a large concern.[10] Additionally, there are consumers who have PHRs throughindependent vendors. One estimate indicates that seventy million people in the United States have access to a PHR. [4] The Federalgovernment ruled on August 23rd, 2012 that Stage 2 Meaningful Use taking effect in 2014 requires “electronic or online access” to patienthealth data versus the previous rule which only required a copy of patient health information.[11] With regard to health benefits, there was a5.25-point reduction in diastolic blood pressure for patients that used a PHR frequently.[10] Primary factors contributing to the increase indemand for PHRs in 2013 includes 32 million previously uninsured Americans placing increased demands on the health system, theimperative for sharing medical record information with patients in Stage 2 MU and tools like PHRs can potentially play a critical role inpreventing re admissions within 30 days of discharge.* This report uses the U.S. Department of Health and Human Service’s definition of a PHR and patient portal with the terms being synonymous.[28]PHR Facts: • Although only 7% of patients were using a PHR, more than 50% said they would be likely to use one if a physician recommended it.[12] • Digitally connecting providers to one another and with patients, experts say, is key to improving patient care, facilitating safety and efficiency, and ultimately reducing costs.[13] • An estimated 70 million Americans have access to a PHR, according to the Massachusetts-based Center for Information Technology Leadership, though most have not adopted the technology. For example, Aetna offers its PHR to 9 million members, yet only 1 million use it.[13] • Patients who use an interactive personal health record (IPHR) are almost twice as likely to be up to date with clinical preventive services as those who do not, according to a new study led by Alex Krist, M.D., M.P.H. [17] • Americans who have access to their health information through personal health records (PHRs) report that they know more about their health, ask more ques- tions, and take better care of themselves than when their health information was less accessible to them in paper records. [24] • Twice as many Gen X and Y consumers want to access and maintain their PHRs using a mobile device than do Baby Boomers and Seniors. [26] • Approximately six out of ten consumers (57 percent) want to access an on online PHR connected to their doctor’s office. [26]
  2. 2. The MichaelBass GroupSignificant DevelopmentsSince this report was last published in January 2012 there have been a number of dramatic changes in the PHR/patient portal market.According to the Congressional Budget Office, the insurance mandate in the Affordable Care Act means that starting January, 1 2014,14 million Americans will be insured with the remaining 16 million coming online by 2021. [29] A report from PwC’s Health ResearchInstitute describes the newly-insured demographic as less educated, more racially diverse, and more than twice as likely to speak aprimary language other than English. Many will also never have been insured before. [30] Given these dynamics providers will need toidentify processes and tools that will help them to successfully get on board this new segment of the population. Tools such as PHRswill become increasingly important to communicate with and engage this patient population. PHRs that provide channels for providersand patients to connect digitally is a key factor to improving patient care, facilitating safety and efficiency and reducing costs. [13]A second, and significant development is Stage 2 Meaningful Use requirements for providers to ensure at least 5% of patients access,print, share or download their health records. [31] This will most likely spur unprecedented demand for PHRs enabling patients toaccess their digital records. With the CMS 30 day readmission rate penalties now in place providers are quickly exploring strategiesand technologies that can help to reduce re admissions. Many studies suggest that better communication and engagement afterdischarge leads to lower readmission rates. The University of Colorado at Denver’s Care Transitions Program demonstrated a 20 to40 percent reduction in overall hospital readmission rates through the use of an innovative transition model that required the use ofa PHR. [32] Given the tailwinds resulting from federal mandates and research that continues to demonstrate the efficacy of PHRs, themarket is positioned for what can be a break-out year.
  3. 3. The MichaelBass GroupIntellectual Property PortfolioThe following list is a comprehensive up to date compilation of the MMRGLOBAL patent portfolio.*Please note the patents listed here and considered in the valuation do not include the biotech patents, and additional claims being filed which are aseparate part of MMRGlobal’s patent portfolio.Patent Portfolio OverviewPatent Report by InventionCOUNTRY REFERENCE# TYPE FILED SERIAL # ISSUED PATENT# STATUSAGGREGATION OF DATA FROM THIRD PARTY ELECTRONIC MEDICAL OR HEALTH RECORDS SYSTEMS INTO A PERSONALHEALTH RECORD ACCOUNTUNITED STATES P10196US00 NEW 5/1/2012 13/461,219 PENDINGDELIVERY OF ELECTRONIC MEDICAL RECORDS OR ELECTRONIC HEALTH RECORDS INTO A PERSONAL HEALTH RECORDSMANAGEMENT SYSTEMUNITED STATES P10123US00 NEW 2/20/2012 61/600,868 PENDINGELECTRONIC HEALTH RECORDS IN CLINICAL TRIALSUNITED STATES P09605US01 FCA 4/8/2011 13/082,896 PUBLISHEDHEALTH RECORD WITH INBOUND AND OUTBOUND FAX FUNCTIONALITYUNITED STATES P10275US00 NEW 6/21/2012 61/662,417 PENDINGMETHOD AND SYSTEM FOR MANAGING PERSONAL HEALTH RECORDS WITH TELEMEDICINE AND HEALTH MONITORINGDEVICE FEATURESUNITED STATES P10102US01 NEW 1/8/2013 13/736, 384 PENDINGUNITED STATES P10102WO00 NEW 1/8/2013 PCT/US13/20641 PENDINGMETHOD AND SYSTEM FOR PROVIDING ONLINE MEDICAL RECORDS WITH EMERGENCY PASSWORD FEATUREUNITED STATES P07531US01 FCA 3/26/2007 11/690,996 PUBLISHEDUNITED STATES P07531US02 CIP 9/4/2008 12/204,474 PUBLISHED
  4. 4. The MichaelBass GroupIntellectual Property PortfolioThe following list is a comprehensive up to date compilation of the MMRGLOBAL patent portfolio.*Please note the patents listed here and considered in the valuation do not include the biotech patents, and additional claims being filed which are aseparate part of MMRGlobal’s patent portfolio.Patent Portfolio OverviewPatent Report by InventionCOUNTRY REFERENCE# TYPE FILED SERIAL # ISSUED PATENT# STATUSMETHOD AND SYSTEM FOR PROVIDING ONLINE MEDICAL RECORDSUNITED STATES P07286US00LORSCH NEW 9/12/2005 11/225,518 2/21/2012 8,121,855 ISSUEDUNITED STATES P07286US01 CIP 12/16/2005 11/305,685 2/14/2012 8,117,045 ISSUEDCANADA P07286CA00 DCA 2/10/2006 2,615,128 PENDINGEUROPEAN PATENT P07286EP00 DCA 2/10/2006 06720652.4 PUBLISHEDHONG KONG P07286HK00 CEQ 2/10/2006 08112621.4 PUBLISHEDISRAEL P07286IL00 DCA 2/10/2006 190,064 PENDINGJAPAN P07286JP00 DCA 2/10/2006 2008-529977 PUBLISHEDJAPAN P07286JP01 DIV 2/10/2006 2012-196065 PENDINGSOUTH KOREA P07286KR00 DCA 2/10/2006 (PCT)2008-7008445 PUBLISHEDMEXICO P07286MX00 DCA 2/10/2006 MX/a/2008/003495 4/23/2012 298478 ISSUEDMEXICO P07286MX01 DIV 2/10/2006 MX/a/2012/001633 PENDINGNEW ZEALAND P07286NZ00 DCA 2/10/2006 566650 12/7/2010 566650 ISSUEDSINGAPORE P07286SG00 DCA 2/10/2006 200801954.9 1/30/2009 140830 ISSUEDWIPO P07286WO00 CEQ 2/10/2006 PCT/US06/04867 NAT PHASEAUSTRALIA P07286AU00 CEQ 5/16/2006 2006202057 5/29/2008 2006202057 ISSUEDAUSTRALIA P07286AU01 DIV 5/30/2008 2008202401 12/24/2009 2008202401 ISSUEDUNITED STATES P07286US02 CON 9/4/2008 12/204,465 2/14/2012 8,117,646 ISSUEDUNITED STATES P07286US03 CIP 9/4/2008 12/204,498 PUBLISHEDSOUTH KOREA P07286KR01 DIV 11/17/2010 10-2010-7025779 PENDINGUNITED STATES P07286US04 CON 3/7/2011 13/041,809 10/30/2012 8,301,466 ISSUEDUNITED STATES P07286US05 CON 1/17/2012 13/352,026 11/27/2012 8,321,240 ISSUEDUNITED STATES P07286US06 CON 1/17/2012 13/352,045 1/8/2013 8,352,287 ISSUEDUNITED STATES P07286US07 CON 1/17/2012 13/352,068 1/8/2013 8,352,288 ISSUEDUNITED STATES P07286US08 CON 10/29/2012 13/663,101 PENDINGUNITED STATES P07286US09 1/8/2013 13/736,339 PENDINGUNITED STATES P07286US10 12/14/2012 13/714,694 PENDINGUNITED STATES P07286US11 12/14/2012 13/714,720 PENDING
  5. 5. The MichaelBass GroupIntellectual Property PortfolioThe following list is a comprehensive up to date compilation of the MMRGLOBAL patent portfolio.*Please note the patents listed here and considered in the valuation do not include the biotech patents, and additional claims being filed which are aseparate part of MMRGlobal’s patent portfolio.Patent Portfolio OverviewPatent Report by InventionCOUNTRY REFERENCE# TYPE FILED SERIAL # ISSUED PATENT# STATUSMOBILE PLATFORM FOR PERSONAL HEALTH RECORDSUNITED STATES P10110US00 NEW 1/23/2012 61/589,805 PENDINGMOBILE PLATFORM FOR PERSONAL HEALTH RECORDSUNITED STATES P10136US00 NEW 2/20/2012 61/600,861 PENDINGPREPAID CARD FOR SERVICES RELATED TO PERSONAL HEALTH RECORDSUNITED STATES P10101US01 NEW 1/8/2013 13/736,340 PENDINGWIPO P10101WO00 NEW 1/8/2013 PCT/US13/20633 PENDINGUNIVERSAL PATIENT RECORD CONVERSION TOOLUNITED STATES P09756US01 FCA 9/28/2011 13/246,948 PUBLISHEDWIPO P09756WO00 CEQ 9/28/2011 PCT/US11/53594 PUBLISHED
  6. 6. The MichaelBass GroupValuation AnalysisThe industry accepted patent evaluation method that we used was PatentValuePredictor.com which has been developed andlaunched several years ago by Richard A. Neifeld and Dr. Martin Goffman.Dr. Neifeld holds a JD degree from George Washington University and a Ph.D. in Physics from Rutgers University. Dr. Neifeld is alsothe founder of Neifeld IP Law, PC. He is a patent attorney registered to practice in the State of Virginia, before the District Court for theDistrict of Columbia, and before the United States Patent and Trademark Office. He is a member of several Intellectual Property as-sociations, and he is the former chair of the Interference Committee of the American Intellectual Property Lawyers Association.Dr. Martin Goffman holds a Ph.D. in Chemistry from Temple University and has owned and operated small high technology businessesfor the past 15 years. In addition to StockPricePredictor.com. LLC, Dr. Goffman maintains his long time passion of informationresearch, particularly in the patent information and related technology fields, and he is the principal of Martin Goffman Associates.Patent Value Predictor reports are based on patented macroeconomic models for automatically valuing patents. The reports arebacked by patent and financial databases which record the proprietary statistics used to predict the potential market size, and yourpatent’s predicted share of this market. Many factors, such as the number of patents in the technology area, profit margins, and theGDP, figure into the statistically predicted valuation.[5]After using the Patent Value Predictor software we established a base value for the market and then took into account the predictedsize of the market (GDP) and the fact that the market has a 7% usage rate of PHRs currently.[6] We adjusted those values to reflectthe size of the market (GDP) predicted and the potential value of the patent portfolio accordingly. We recognized that the patentslisted here have a remaining enforcement life of approximately 14 years from when they issue. The biggest factors in determiningthe value of the patent portfolio that we took into consideration were patent significance, the market size, the patent term, andamount of prior art.Based on our analysis, the range of value for these patents could reach $600 million to $1.1 billion in revenue based on very con-servative estimates that the market will reach the full GDP value of $19 billion in the next 10 years.[1] The risk factors for these patentvalues not realizing their predicted range of value include, adoption rate of PHRs, the claims granted in the patent are not enforce-able and widely used, the market doesn’t grow as quickly as predicted, the prices for PHRs drop substantially, and or government/regulatory forces. This valuation does not take into account the international patents which have issued in the MMRGlobal portfolio.Conclusions & Opportunities Looking AheadThe world’s healthcare IT market is expected to grow PHRs will continue to evolve and will become more standard-from $99.6 billion in 2010 to $162.2 billion in 2015, representing ized as regulations and legislation governing them go into effect.a CAGR of 10.2% from 2010 to 2015.[19] There As outlined in the Federal Strategic Health IT Plan published inare approximately over 150 PHRs [27] and 750 EMR’s September 2011, the government has a stated goal to empower[7] that have been identified as active in the marketplace. the individual and offer incentives around giving patients accessThese 900 providers are potential license targets as well to their health information in an electronic format or (PHR). [8] Aas potential infringers of MMRGlobal’s patent portfolio. There key tenet of Stage 2 Meaningful Use, which takes effect in 2014,are over 5,500 hospitals and 56,000 pharmacies in will rely heavily on the functionality that PHRs afford providersthe United Sates. MMRGlobal will pursue licensing agree- to engage patients and their families in their care. [8] In 2012,ments with Hospitals, Providers, Payors, Pharmacies and estimates are that the government paid out $1.2 billion in theSoftware Vendors. Additionally MMRGlobal continually files month of December alone, with an estimated total of $10.3claims with the US Patent Office on a regular billion in EHR incentive payments since the start of the programbasis to enhance the patent portfolio. in 2009. [33]
  7. 7. The MichaelBass GroupReferences and Sources 1. Jones, D.A., Shipman, J. P., Plaut, D.A., Selden, C.R. (2010). Characteristics of personal health records: findings of the Medi- cal Library Association/National Library of Medicine Joint Electronic Personal Health Record Task Force. Journal of Medical Library Association. (98)3 243-249 2. Coffield, RL, DeLoss, GE, Mooty GP. The rise of the personal health record: panacea or pitfall for health information. Health Lawyers News. 2008 Oct; 12 (10): 8–13. 3. Scherger, JE. Future vision: is family medicine ready for patient-directed care?. Family Medicine. 2009 Apr; 41 (4): 285–8. 4. Kaelber, DC, Jha, AK, Johnston D, Middleton B, Bates DW., A research agenda for personal health records (PHRs). Journal of American Medical Information Association. 2008 Nov–Dec; 15, (6): 729–36. DOI10.1197/jamia.M2547. 5. Neifeld, R. A., Martin, G., (n.d.). Retrieved from http://www.patentvaluepredictor.com 6. Singer, E. (2010, April 14). Use of Personal Health Records Is Growing. Technology Review. Retrieved from http://www.tech- nologyreview.com/blog/editors/25047/ 7. Douglas, M., Eisenberg, C. (2011, September 22). Electronic Medical Records: A Silicon Valley Gold Rush. Bloomberg Businessweek. Retrieved from http:// www.businessweek.com/magazine/electronic-medical-records-a-silicon-valley-gold- rush-09222011.html 8. United State Department of Health and Human Services. (2011, September 12). Retrieved from http://healthit.hhs.gov/strate- gicplan 9. United State Department of Health and Human Services, Centers for Medicare and Medicaid. (2011, December 31). State Breakdown of Payments to Medicare and Medicaid Providers through December 31, 2011. Retrieved from http://www.cms. gov/EHRIncentivePrograms/ 56_DataAndReports.asp#TopOfPage 10. “Health Information Technology.” Research Activities, November 2012: : Study Finds Personal Health Records Do Not Impact Hypertension Care. N.p., n.d. Web. 29 Nov. 2012. <http://www.ahrq.gov/research/ nov12/1112RA26.htm> 11. “MMRGlobal Brings Retail Prepaid Personal Health Record Card to Healthcare Professionals.” Blogspot.com . N.p., n.d. Web. 29 Nov. 2012. <a. http://yourpersonalhealthrecord. blogspot.com/2012_02_01_archive.html 12. “Study Identifies Patients Most Willing to Use Personal Health Records.” - Amednews.com. N.p., 29 Feb. 2012. Web. 29 Nov. 2012. <http:// www.ama-assn.org/amednews/2012/11/12/bisa1112.htm> 13. “Personal Health Records.” AARP. Christopher J. Gearon, 29 July 2010. Web. 30 Nov. 2012. <http://www.aarp.org/technol- ogy/innovations/ info-07-2010/ Digital_Personal_Health_Records.html> 14. “Take Control of Your Medical Information: Personal Health Records and Your Privacy.” Privacy Rights Clearinghouse. N.p., 26 Oct. 2012. Web. 29 Nov. 2012. <https://www.privacyri ghts.org/take-control-of-your-medical-information-alert-2012> 15. “Making Personal Health Records More Usable.” IU Communications. N.p., 5 Jan. 2012. Web. 29 Nov. 2012. <http://commu- nications.medicine.iu.edu/ newsroom/stories/2012/making-personal-health-records-more-usable/> 16. “Personal Health Records Could Spur Patients To Obtain Preventive Care - IHealthBeat.” Personal Health Records Could Spur Patients To Obtain Preventive Care - IHealthBeat. N.p., 13 July 2012. Web. 29 Nov. 2012. <http:// www.ihealthbeat.org/ articles/2012/7/13/personal-health-records-could-spur-patients-to-obtain-preventive-care.aspx> 17. “Interactive Personal Health Records Increase Clinical Preventive Services.” - Massey News. N.p., 10 July 2012. Web. 29 Nov. 2012. <http://blog.vcu.edu/ massey_news/2012/07/interactive-personal-health-records-increase-clinical-preventive- services.html> 18. “Electronic Personal Health Records That Promote Self-Management in Chronic Illness.” Electronic Personal Health Records That Promote Self-Management in Chronic Illness. N.p., 20 July 2010. Web. 29 Nov. 2012. <http:// www.nursingworld.org/ MainMenuCategories/ANAMarketplace/ANAPeri odicals/OJIN/TableofContents/Vol152010/No3-Sept-2010/Articles-Previously- Topic/Electronic-Personal-Health-Records-and-Chronic-Illness.html>
  8. 8. The MichaelBass GroupReferences and Sources 19. “MMRGlobal Receives Fifth Patent Expanding Rights to Control of Online Medical Records.” Yahoo! Finance. N.p., 26 Nov. 2012. Web. 29 Nov. 2012. <http://finance.yahoo.com/news/mmrglobal-receives-fifth-patent-expanding-133500755.html> 20. Siegal, Gil. “Virginia Journal of Law & Technology.” Enabling Globalization of Health Care in the Information Technology Era: Telemedicine and the Medical World Wide Web 17.1 (2012): 1-34. Web. 29 Nov. 2012. <http:// www.law.virginia.edu/pdf/fac- ulty/siegal/vajlawtech2012_siegal.pdf > 21. “Personal Health Records (PHRs).” Medicare.gov: The Official U.S. Government Site for Medicare. N.p., n.d. Web. 30 Nov. 2012. <http:// www.medicare.gov/ manage-your-health/personal-health-records/personalhealthrecords.html> 22. “The Benefits & Advantages of Personal Health Records.” The Benefice and Advantages of Online Medical Records, Us- ing Access Health Records, the Leader in Personal Health Records, Phr. N.p., n.d. Web. 30 Nov. 2012. <http:// www.ac- cesshealthrecord.com/advantages.html> 23. “What Are the Key Challenges to PHR Adoption?” What Are the Key Challenges to PHR Adoption? N.p., n.d. Web. 30 Nov. 2012. <http:// www.hrsa.gov/ healthit/toolbox/HealthITAdoptiontoolbox/Personal HealthRecords/ keychallenges.html> 24. * Sherman, Spencer A. “New National Survey Finds Personal Health Records Motivate Consumers to Improve Their Health - CHCF.org.” New National Survey Finds Personal Health Records Motivate Consumers to Improve Their Health - CHCF.org. California HealthCare Foundation, 13 Apr. 2010. Web. 30 Nov. 2012. <http://www.chcf.org/media/press-releases/2010/ new- nationalsurveyfinds-personal-health-records-motivate-consumers-to-improve-theirhealth> 25. Goel, MS etal “Disparities in enrollment and use of an electronic patient portal” J Gen Intern Med. 2011 Oct;26(10):1112-6. Epub 2011 May 3. http://www.ncbi.nlm.nih.gov/pubmed/21538166 26. Keckley, Paul etal “The Mobile Personal Health Record” Deloitte Center for Health Solutions 2010 http://www.deloitte.com/ view/en_US/us/Insights/ centers/ center-for-health-solutions 27. Lewis, Nicole “Google Health Dies, But PHR Market Still Growing” Information Week http://www.informationweek.com/health- care/electronic-medical-records/google-health-dies-but-phr-market-still/231000876 28. http://www.healthit.gov/providers-professionals/faqs/what-patient-portal 29. http://www.ama-assn.org/amednews/2012/10/22/bil21022.htm 30. “Health Insurance Exchanges: Long on options, short on time,” PwC, Oct. 8 (www.pwc.com/us/en/health-industries/publica- tions/public-private-health-industry-exchange-models.jhtml) 31. http://www.ama-assn.org/amednews/2012/09/17/bisb0917.htm 32. http://www.innovations.ahrq.gov/content.aspx?id=1833 33. http://www.modernhealthcare.com/article/20130108/NEWS/301089956/whopping-1-22-billion-in-ehr-payments-in-december)
  9. 9. The MichaelBass GroupAbout The MichaelBass Research GroupThe MBG research group looks at economic, market, industry and company data relevant to the healthcare sector to help companiesset their strategic direction. The MBG’s primary goal in research is to provide in-depth, domain knowledge and deliver specializedanalysis to our client base. We seek to find strong, well-managed public and private companies that represent both value and growthopportunities to investors. As a result, MBG is considered to be an invaluable resource among boutique investment banks, recognizedfor our breadth and depth of insight and timeliness of service. Our clients receive detailed, up to date information that they rely on.The MBG research department is powered by a team of highly experienced analysts focusing on more than 400 growth companies inHCIT. Our analysts aim to uncover industry and company developments before they are widely known, understanding events as theyevolve and disseminating the facts as soon as they are verified, including policy changes, market shifts and valuations.Disclaimers:THIS REPORT IS TIME-DEPENDENT AND STATISTICAL IN NATURE, AND DOES NOT TAKE INTO ACCOUNT PATENT VALIDITY,MARKET CONDITIONS, BUSINESS CONDITIONS, OR LEGAL, BUSINESS OR FINANCIAL FACTORS, WHETHER OTHERKNOWN OR UNKNOWN, ANY OR ALL OF WHICH MAY AFFECT THE ACCURACY OR COMPLETENESS OF THIS SERVICE. THEINFORMATION CONTAINED IN THIS REPORT WILL CHANGE FROM TIME TO TIME DEPENDING ON THE ISSUANCE OF NEWPATENTS OR PUBLISHED APPLICATIONS, THE EXPIRATION OF PATENTS, PATENT INVALIDITY OR REISSUES, ACCURACYOF PUBLISHED PATENT DATA, OR OTHER CONDITIONS OVER WHICH THE MICHAELBASS GROUP HAS NO CONTROL. THEMICHAELBASS GROUP ASSUMES NO RESPONSIBILITY FOR ERRORS OR OMISSIONS IN THIS REPORT, AND MAKES NO, ANDEXPRESSLY DISCLAIMS ANY, REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING THIS REPORT.

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