Medical Alarm Concepts Holdings, Inc. (MDHI) – Investment Executive Summary

Medical Alarm Concepts Holdings, Inc. (MDHI) – Investment Executive Summary

We have launched coverage of MDHI. You can view the report in sections by clicking on the Company tab for Medical Alarm Concepts Holdings, Inc. on the right side of this page. Alternatively, you can also access our full Briefing by clicking on the following link: Medical_Alarm_Concepts_Holdings_MDHI_Mar_08_2010

Executive Summary

In this day and age, living arrangements have changed greatly in the United States among both older people and other potentially vulnerable segments of the population, including those with physical disabilities or medical conditions.

During the 20th century, one of the most dramatic changes in the lives of the elderly in the United States was the rise of the proportion of elderly widows/widowers living at home alone. At the beginning of the twentieth century, the majority of the elderly who had living children resided with at least one child. Today, however, most live either solely with their spouses or, if not married, they live alone. Overall, the magnitude of the change in the proportion of the elderly living alone is immense. In 1910, for example, only 12% of widows age 65 or older lived alone. In 1970, this figure was 70% and today it is estimated to be even higher.

Currently in the 21st century, this trend has gained momentum and become stronger than ever, with more of the elderly and medically at risk population living alone at present than at any other time in the past, especially with the rise of the aging Baby Boomer population as a group. The Baby Boomers, those born between 1946 and 1964, will start turning 65 years old in 2011 and within this situation, the number of older people will increase dramatically during the 2010 to 2030 time period. According to a 2009 analysis of U.S. Current Population Survey data, “between 2010 and 2030, the number of people age 65 and older is projected to grow by 31.7 million or 79.2%.” Thus, the older population in 2030 is projected to be twice as large as in 2000, growing from 35 million to 71.5 million, representing nearly 20% of the total U.S. population around the year 2030.

This social dynamic of a rising older population is true in both the United States as well as in many developed nations in particular worldwide. Likewise, social change, technological advancements and general lifestyle choices have promoted increased independence and the ability to live alone among other potentially vulnerable segments of the population such as those with physical disabilities or medical conditions. These groups can be especially susceptible to heath problems and concerns for their physical well being. Experts and even common sense agree that in order to help facilitate independence and safety, more help is needed to provide elderly people and the medically at risk living alone with a point of contact in case of emergency or the benefit of support in a time of need.

It was in response to this situation that the personal emergency response systems (“PERS”) industry emerged in the United States and developed the first personal medical alarm. The most obvious and common use for personal medical alarms is as a safeguard for the elderly and persons with certain medical conditions, in case of an age or health related incident that requires immediate attention but in which the victim is unable to reach out for assistance via traditional means, including the ability to make a telephone call.

Effective personal emergency response systems (PERS), with their emergency alert capabilities, are a key technology solution that can greatly help the vulnerable segment of the population live a more free and active life while maintaining the security of being able to access immediate assistance as needed. In fact, there has been a boom in the PERS market in recent years because of the growing elderly population worldwide. According to Forrester Research, Inc., the PERS market in the United States is estimated to grow at double digit rates, from approximately $350 million in 2004 to $2 billion in 2012.

Today, however, while the PERS industry has been around for a long time, much of the technology within the industry has unfortunately remained stagnant. In general, many of the original PERS solutions are still designed today to provide alerts whereby a push of a button simply triggers a call center operator to respond by calling the device user at home, with two-way voice communication done through a centralized speaker box and not the actual device itself. Thus, traditional PERS solutions currently on the market offer communication between user and a call center only through a speaker box, thereby inhibiting the user’s freedom and limiting their mobility to an area near the base station.

Medical Alarm Concepts™ has built upon traditional PERS technology to develop a revolutionary patented solution for direct two-way voice communication through its MediPendant™ alarm device. In particular, the Company’s wearable alarm pendant enables users to manage the spontaneity of an emergency by responding anytime, anywhere through a two-way voice speakerphone pendant that connects to the Company’s monitored call center for direct communication, leaving users free to move in and around their home within an extended mobility range that exceeds that of other personal alarm offerings.

Additionally, MediPendant’s™ advanced technology allows for three-way calling between the operator, the user and the dispatched first responders and/or a friend and family member. No other available PERS system on the marketplace today offers the benefit of three-way voice conferencing directly through the pendant.

We believe these attributes of the MediPendant™ mark an important distinction relative to the competition and make the Company’s solution unique in the industry and highly desirable to end users who want to be able to move more broadly about their living quarters with increased freedom and comfort while maintaining the assurance of gaining help in an emergency.

Going forward, not surprisingly, experts in the health care industry expect many seniors and medically vulnerable persons will want to continue living independently at home for as long as possible. Likewise, more than any elderly generation of the past, this population is expected to be more technology-savvy as consumers of healthcare and very interested in playing an active role in personally managing their health and well-being. Importantly, they will likely look to technologies that help them gain access to medical care while being able to remain independent and outside the hospital environment. We believe the Company’s patented MediPendant™ personal alert pendant is the best solution on the marketplace today by far, with its superior functionality and attributes that are unique to the PERS industry.

Furthermore, with sales efforts for the Company’s MediPendant™ alarm solution just beginning to get underway, we are very excited about the future prospects for this product offering and expect that sale of this premiere alarm device will increase exponentially with Medical Alarm Concept’s ongoing marketing efforts.

We urge investors to closely watch this story as we believe revenue and profit growth could be dramatic.

To access our full Briefing on MDHI, please click on the following link: Medical_Alarm_Concepts_Holdings_MDHI_Mar_08_2010