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Diversified health business Healthia (ASX: HLA) is exporting its proven iOrthotics business model to the US with the launch of a 3D-printed orthotics manufacturing lab in New York City.
The Brisbane-based company backed by Shark Tank shark Glen Richards has secured a five-year lease for a facility in Astoria, Queens, where an HP Fusion Jet 3D printer will be able to produce up to 30,000 pairs of orthotics annually.
Healthia owns a 58 per cent stake in the group that will operate the laboratory, iOrthotics USA, with the remainder held by Hersco Orthotics Labs of Long Island.
The group estimates a potential annualised revenue of US$1 million (AUD$1.48 million) from one printer operating at full capacity, from which Healthia Australia subsidiary iOrthotics Australia would derive an IP licence fee. The facility also has the capacity for two more printers to be set up.
"Since being established in 2009, iOrthotics has grown to become Australia's leading manufacturer of 3D printed orthotic devices so this new facility in New York gives us an opportunity to bring our innovation to one of the world's largest healthcare markets," says Healthia CEO Wesley Coote.
"Our chief technology officer, Dean Hartley (pictured left), has done a terrific job setting up the new facility and we look forward to replicating iOrthotics industry-leading technology on a much larger scale."
The US foot orthotics insoles market was estimated to be worth US$1.289 billion (AUD$1.9 billion) in 2017, representing around 40 per cent of the global market.
Orthotics have traditionally been custom made by hand but using computer aided design (CAD), they can be produced at greater scale with 3D printing.
iOrthotics is focused on reducing the environmental impact of plastic and rubber-based materials traditionally used in the manufacturing process, with the potential to cut waste by more than 95 per cent.
HLA shares were up 0.87 per cent at $1.16 each at 11:15am, bucking the downward trend for global health stocks today with the Global Health ETF (ASX: IXJ) down 1.05 per cent at $102.
Listed in September 2018, Healthia owns a variety of allied health businesses including iOrthotics, My FootDr, AllSports Physiotherapy, D.B.S. Medical Supplies and Extend Rehabilitation; the latter a hand therapy clinic business acquired fo $3.5 million in August 2019.
The company's financial results exceeded expectations in its first full-year as a listed company, with FY19 underlying revenue beating the prospectus forecast by 6.6 per cent and EBITDA surpassing projections by 13.6 per cent.
The company's prospectus listing goal was at $1, but shares opened at $1.26 each before steadily dropping to a low of 78 cents in mid-2019. However, shares have spiked upwards following a flurry of acquisitive activity and positive results.
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