Ian McCrae maps his genome, plans taking Orion to next level

Orion Health [NZX: OHE] founder and chief executive Ian McCrae had his genome sequenced recently and found he is .02% West African.

Where that came from he doesn’t know, but what he also found is that he’s just 2% Neanderthal, which is quite a low percentage apparently.

Whether that gives him any more brain capacity he wont say, but he is ready to put that brain to work as his company enters the next phase of its growth path.

Mr McCrae reckons he hasn’t had much thought about his paper net worth – about $500 million based on todays share price following its NZX debut. What he’s thinking about is the next challenge for Orion.

That involves deploying the $120 million of capital raised today into research and development of software products and solutions for the healthcare sector.

And that includes harnessing the power of genomic information and device data gleaned from medical records and patient interactions via the internet and help create “healthier populations”.

Commenting after today’s NZX and ASX listing, Mr McCrea said while it is an important milestone, what he and his staff spend most of the time thinking about is what’s next.

“People have invested in us and now we’ve got to start thinking about delivering some results, so that’s what we’re focusing on.

“What this gives me is at last the freedom to spend a heck of a lot more time on the product R&D side. That’s my happy place and what customers value.

“So we are starting to wire up our staff and measure all sorts of data. I don’t know where this is going to go but there’s going to be some pretty exciting things that get produced.”

The company plans to double its current 350 R&D staff over the next three years, recruiting engineers and IT people from New Zealand if possible.

Orion raised a total of $125 million through its IPO, including $5 million worth of shares sold into the offer by interests associated with Mr McCrae.

The shares listed at $6.50, a 14% premium to the offer price of $5.70 and soared as high as $6.79 before settling at about $6.60.

Mr McCrae said the IPO gives the company the resources it never had.

“This gives Orion Health the springboard to be a major company in the health information space and that market is probably a $50 billion market. So we have a huge opportunity in front of us.”

Chairman Andrew Ferrier, clearly excited by his first involvement in a public listing after many years in business, said the listing was a “particularly important milestone in the evolution of a really, really exciting business.”

Orion didn't provide earnings forecast in its prospectus because of the "lumpy" nature of the group's revenues for fear of potentially misleading investors.

The company has had an annualised growth rate of 26% over the past 10 years, and had been making small profits until recently.

However, it posted a loss of $14.8 million in the six months ended September 30, 2014 on sales of $80.5 million. The interim loss was largely the result of the company’s decision to ramp up R&D spending and investment in the US market.

The company has more than 450 customers in 25 countries and 1150 staff.