As an avid SCRC investor for over a year now, I

As an avid SCRC investor for over a year now, I am excited to learn more about the various revenue streams Mr. Bob Schneiderman has developed to support the financial backbone for the future. I am not an expert on notes, but from what I understand by reading the many posts on this board, Ironridge seems to be the major player and their note count is dwindling down. The significance of the elimination of the notes is that the future revenues generated by ScriptsAmerica will lead to a more positive cash flow, and a P/S which will correspond according. As investors, this is what we have been waiting to hear and see as we move into the remaining quarters for 2014. One revenue stream in particular, compounding pharmacy, has really gained my interest. As I mentioned in an earlier post, I have been in the pharmaceutical industry for over 36 years but I am not well versed on compounding pharmacy. These last few days I have been doing my own DD to learn more about this industry, most importantly the profitability associated with the compound pharmacy industry. I’ve had discussions with a couple friends of mine who work in the compound pharmacy industry.

To better understand this industry one needs to understand the difference between the traditional pharmacy and the compounding pharmacy. In a traditional pharmacy, the pharmacist is handed an Rx from a patient for one drug, usually written for a certain number of pills to be taken once, twice, or three times a day. The patient will pay their copay and the remaining cost of the Rx is charged back to the payer (managed care company) who then reimburses the pharmacy based on negotiated payments schedules. In terms of compound pharmacy, the main difference is the Rx is not for one drug, but for a combination of drugs usually formulated as a cream or gel for topical application. For example, I learned one Rx used to treat pain consists of seven different drugs. As you could imagine, formulating this Rx into a gel or cream is labor intensive, adding the cost of the various medications along with a profit margin, the Rx price could be as much as $3000. The cost of a compounding pharmacy Rx to the patient can vary anywhere between $30 & $50 depending on the co-pay card they have. The remaining cost of the Rx is charged back the payer (managed care) who today is reimbursing the pharmacy in the range of 50%, 75%, and yes even up to 100%. To put that in terms of revenues, one compound pharmacy Rx could generate as much as $1500 to $3000 to the pharmacy. More and more physicians and surgeons are beginning to appreciate the therapeutic benefit of the compounding pharmacy. I believe the potential of this market place is right now in it’s infancy.

I learned from a friend who is a compound pharmacist that pharmacy he works for generates $2M, and growing, each month. Based on a recent PR from Mr. Schneiderman, SCRC is not at that level right now (reported March revenues $494K), but I am sure he is doing everything he can to grow the business. Can you imagine a penny stock company generating revenues of $24M in one year? And that doesn’t even take into consider the potential revenues for RapiMeds in Hong Kong and as we learned earlier Canada, as well as the other not mentioned SCRC revenue streams. So one might ask, why am I excited about SCRC? It’s easy, the business model developed my Mr. Schneiderman, from my own perspective, is destined for success. I won’t even suggest what a P/S will be in the next several months, but my best guess is it will be a lot higher than the .12 range we are at right now.

The value of this IHub is that one can read positive and not so positive posts concerning SCRC. As a result, I highly recommend any new investor to conduct their own DD before taking the next step to invest. I’ll end my post as I always do, GO SCRC!!!