Christopher “Chris” Smith, CEO of Orlando-based Lifestyle Medical Network, Inc. (LMNK: OTC US), talks with Opportunist’s Managing Editor Leslie Stone about how his company is helping physicians to provide a new standard of care for their patients, improve their negotiating power and add new revenue streams..
The worldwide anti-aging industry was worth $195 billion worldwide in 2013 and is projected to top $275 billion by 2020, according to research conducted by Global Industry Analysts. Companies such as Lifestyle Medical Network, Inc. are banking on an aging population’s thirst for healthier lifestyles and longevity. “We provide physicians with the knowledge and skills to provide a new standard of care for their patients,” says CEO Chris Smith. “We utilize our wealth of knowledge in research, education, and experience in clinical practice to provide our network with the latest advances in technology, concepts, techniques, and treatment options. More importantly, we believe that each patient should have the ability to achieve their optimum health condition. Instead of a ‘one-size-fits-all’ approach, our network of physicians believes that each patient is unique in their needs, goals and issues and tailors the best treatment available specifically to the individual.”
According to Smith, there are countless opportunities within the medical industry that will allow Lifestyle to go in multiple directions. “Lifestyle is essentially an evolving company,” he explains. “From a management services perspective, for example, we are adding new revenue streams for physicians that were previously nonexistent. We are helping them to have better negotiating power as a collective group versus a single entity—for all facets of their business, from buying examining table paper to getting the best reimbursement rates from their insurance.”
The growth of the company is based on the expansion of its intellectual properties and programs that it is launching and plugging into different practices, Smith adds. “This includes those we directly manages as well as those outside our reach, from wellness models, weight management programs, anti-aging bioidentical hormone therapy, and stem cell therapy. We have the ability to work with whomever we feel fits best with our ideals. We want to bring the best products and services to our physicians and help them make more money, obviously, but more importantly help them provide better care for their patients.”
Opportunist: Chris, how did you become involved in business management, and particularly in the medical sector?
Chris Smith: I started off professionally in brokerage and investment banking. Through my involvement there I met many different types of professionals, quite a few of whom were physicians I was able to help not only financially with their investments but also with their practice. That experience got me very interested in the medical side of business not only from an investment banking perspective but day-to day-operations as well. From 2005 through about 2010, I started doing private equity style transactions and intellectual property in the medical sector and that is what turned the corner for me to get involved with medical consistently.
Opportunist: What brought you to Lifestyle Medical Network and what is your role with the company?
Chris Smith: The idea for this company was something that basically evolved over time through all the opportunities and transactions that I and those working with me saw through the years. It was kind of a collective effort to do something that brings together a lot of segments of medical not only from group purchasing and management service but day-to day-operations, negotiating with insurance companies, vendors, equipment manufacturers and development of new procedures, processes and protocols.
We did a reverse merger into a public shell in 2012 and all the way through the last quarter we looked at approximately 100 different deals we thought about plugging into the company but none of them quite fit. About nine months ago, we ultimately found the right deal to launch from and it has taken us that much time to feel comfortable and structure everything the way we envisioned it to be. We have just completed a full quarter of operations and we will be reporting our first quarter of true operations in the next 45 days or so.
Opportunist: How is technology changing the way medical practices operate?
Chris Smith: Technology is certainly simplifying certain aspects of how a medical practice operates. Of course technology can cripple a business immediately when networks go down, but from a single practitioner point of view technology can do nothing but help. Not only can it make a practice run more efficiently but it also allows more time for patients instead of filling out forms. EMRs [electronic medical records] make everything available at the touch of a fingertip. Data can be loaded and pulled up later in one of 10 or more different ways. For example, a medical practice can pull up every diabetic patient to figure out diagnostic tests it should be performing or even pull up patients by ZIP code. There is much more flexibility and opportunity because of new electronic data systems.
Opportunist: How many physicians are members of Lifestyle and what criteria must they meet to become affiliated with the network?
Chris Smith: Lifestyle works either directly or indirectly with about 200 different physicians. We have management agreements with about 15 providers and we do ancillary services and product development protocols with another 50 to 200 that either will be directly part of the company or will continue to receive our services outside the company. Each of these entities, whether part of the company or not, are potential revenue streams for us.
In terms of becoming part of our network, we are looking for specific structures and certainly the physicians involved must be of the utmost character and have a clean record with the state in which they are doing business. We obviously don’t want anyone involved who has had issues with any regulatory agencies, lawsuits or that type of thing. People sue sometimes for the wrong reasons, obviously, but we are very selective nonetheless. If the structure of their practice fits within ours, the physicians as well as the other providers who work with them, such as nurse practitioners and so forth must also fit our criteria.
Opportunist: What kinds of revenue streams is Lifestyle helping physicians to open up?
Chris Smith: From a weight management or wellness perspective, we have the ability to offer physicians a program that can help them help their patients and at the same time provide them with information on their patients’ progress. This might include seeing the progression of the patient’s bloodwork to a positive level, such as lower cholesterol, blood sugar monitoring or, most importantly, helping their patients become more active in their lives through a weight management program that is not a diet but basically lifestyle changes geared toward improving their individual health. We have the ability to go into that with some of our existing products, and we will be launching within 45 days the ability to go in and look at an individual and tell you exactly what he or she should be doing and or not be doing in helping them get to their correct weight. More importantly, we will provide a step-by-step guide on how to get there.
Opportunist: Are there any new developments you can share with us today?
Chris Smith: The most significant development is that our first quarter was extremely successful and our business model is working exactly how it was supposed to. Quite frankly, things are moving much more rapidly than we expected. We are in the process of developing multiple lines of products for use within our trademarked protocols for weight management and wellness. I can’t get deep into it at the moment but we are in the process of development with dietitians, nutritionists and scientists with whom we have close relationships and we will be implementing our strategy in the near future.
Opportunist: What is Lifestyle’s involvement in hormone therapy?
Chris Smith: When we get to a certain age the body stops producing hormones. Women go through menopause and men typically lose testosterone and become more fatigued and not as male dominant. There are ways to fix that problem. I don’t want to bash the rest of the medical community but treatment typically becomes a one-size-fits all. We are aiming to provide a protocol that physicians can rely on, that is backed by scientific data and that supports a certain type of regimen for hormone therapy. Our program insulates our physicians from potential legal issues by providing them with the correct methodology behind administering it. One of the problems with medicine as a whole is that physicians are fearful of new things because they don’t have the support or the backing from someone saying ‘Yes, it’s OK.’ At this point if the FDA says it’s OK they’ll do it and the FDA does not regulate bioidentical hormones.
Opportunist: What are Lifestyle’s potential revenue streams?
Chris Smith: There are lots of potential revenue streams. We are in the beginning stages, obviously, and our first focus right now is precisely on Houston. We are starting everything from there and all of our medical operations are in Houston.
Opportunist: Why Houston?
Chris Smith: First, the right opportunity presented itself in Houston. Second, Houston is one of the Top 5 major markets in the country. Additionally, Houston is one of the second or third most obese metropolitan areas of the country. So, for our wellness and weight management programs, it made a lot of sense to start there. Also, Texas is very pro-business and very similar in structure to Florida. Our headquarters is in Orlando where, including the surrounding area, there is a population of about a million people. Houston and the surrounding suburbs are close to 10 million people.
Houston is quite a diverse city with a lot of different ethnicities. There is a significant Hispanic population in the area, as well as Asian and Indian. We will have the ability to build some of these wellness models in multiple languages, which I know a lot of companies don’t do right now. That is yet another reason for going there and launching our wellness and weight loss programs in Texas. There are a lot of different opportunities there.
Opportunist: Your website mentions stem cell therapy. How will the company become involved?
Chris Smith: Stem cell therapy is obviously a rapidly growing segment of the market. We have been working with two physicians who currently operate stem cell therapy clinics and have different procedures. We have had some productive conversations with them and expect to develop something in the stem cell therapy market but until the right opportunity presents itself we will continue to be a diligence gatherer. There is tremendous potential and providers are having success in that market, which ultimately fits into the anti-aging market and the entire wellness market. Both of those segments are billion-dollar industries.
Once the procedures and the protocol can be consistently replicated, the uses are infinite. Orthopedic professionals are having great success with the use of stem cell therapy, whether for regenerating cartilage and tissue or increasing the ability for the body to prepare itself more efficiently. I think the public as a whole expects at some point that stem cell therapy will be the magic pill, and it very may well be—but 30 years from now. It can certainly do beneficial things for certain people and that is why we have an interest in it.
Opportunist: Who are your biggest competitors?
Chris Smith: There are probably small competitors in the market from management services companies to contract negotiating providers. I believe that most of those try to specialize in one specific area, but it’s our intention to provide multiple solutions on a broader scale for physicians rather than to become a one-stop-shop. This will ultimately make our client-physicians’ lives easier and allow them to expand their knowledge base with a plethora of specialties to learn from historically. Overall, we will provide a more meaningful impact for them whether by eliminating exclusive costs and time spent doing things to providing an opportunity for them to increase their bottom line. They will continue doing exactly what they are doing today but become more productive doing it.
Opportunist: What is the most rewarding aspect of your work?
Chris Smith: The constant growth—whether intellectually or socially—because every week I meet between 30 to 40 new potential partners and vendors. It’s exciting to see the opportunity that exists everywhere, the direction that we can take the company and just the fact that we are going from zero to 100 miles an hour in a very short period of time.
Opportunist: What does Lifestyle have slated for the second half of 2015?
Chris Smith: We will continue to acquire practices that fit within our model and continue to develop and expand at a sustainable pace while providing value and opportunities for our physicians. During the second half of 2015 we will have a few products that any physician in the country can participate in, which will help them provide better service to virtually any patient.
Opportunist: Is there anything you would like to say to potential investors?
Chris Smith: We believe we have a platform within the medical industry that is unique. We have made a very concentrated effort at this point and have achieved what we’ve set out to accomplish. We feel the opportunity and the expansion and profitably of Lifestyle has no limits.
Opportunist: Where would you like to see Lifestyle Medical Network in, say, the next five to 10 years?
Chris Smith: Our goal is to have a minimum of 50 medical practices for which we are directly managing every aspect of their business. I see the company having several subsidiaries that will be created through the acquisition and digestion of other businesses. That will open us up into specific subsets including medical billing, coding, credentialing or group purchasing and organization style entities and purchasing on behalf of hundreds of businesses to help us get the best prices and providers and add them to our business. We will also develop a referral network wherein we can help our physicians find the best specialist or at least have the opportunity to refer their patients to a specialist. There is a lot of opportunity there. It’s phenomenal.
In a nutshell, Lifestyle Medical Network will be ever evolving. I think the real focus is going to be on all the new products and processes and revenue streams that we can help physicians attain. We will be nationally focused, without question, especially for some of our protocols that are primarily for weight loss.
Leslie Stone is an award-winning writer, editor and journalist with more than two decades of experience covering business, finance, real estate and lifestyle issues for newspapers, magazines and online publications. Originally from Virginia, she currently resides between Florida and Michigan. Follow Leslie on Twitter: @lescstone.