Widecells Group Plc (LON:WDC) Chief Executive Officer João Andrade caught up with DirectorsTalk for an exclusive interview to discuss the launch of CellPlan, the UK’s first insurance product for stem cell treatment
Q1: The UK’s first insurance product for stem cell treatment, CellPlan, is now available for purchase, now this is obviously a huge milestone for both Widecells Group and for the stem cell industry. Can you give us a bit more information on what CellPlan is and why somebody would want to purchase it?
A1: CellPlan is the first of its kind, a stem cell healthcare insurance plan and the objective of CellPlan is to make stem cell treatment accessible and affordable. So, globally we have around 3 million people that have already paid around £2,000 to store their baby’s umbilical cord blood stem cells to protect them against future illnesses, mainly blood diseases and disorders and these stem cells can be used within the nuclear family circle which means siblings and parents. So, we have already a captive audience out there who understands the benefits of storing stem cells and what they can be used for in the future but the problem is that stem cell treatment can cost up to £300,000 which means the majority will not be able to afford it.
So, we have developed CellPlan to make this now affordable and we are converting a potential £300,000 bill into an insurance policy that costs an average price of £170 per year for the family or less than £15 a month so what we’re doing is creating a huge impact in the industry by making it affordable which means more people will be able to access this amazing technology.
Q2: Looking at how CellPlan can be purchased, you’ve secured a highly strategic agreement with the UK’s largest private human tissue storage facility, Biovault, and have also created an e-commerce platform. How will these 2 sales platforms work?
A2: We have developed, what we call, the CellPlan Excel Programme which is a quality programme built on existing licencing and international accreditation and the importance of this quality programme is when a cord blood bank wants to start offering CellPlan to their clients, they need to meet these stringent criteria that we have developed because we are insuring a family against the sample that’s stored in that cord blood bank and this sample might be stored, the umbilical cord blood, for 30 years. So, it’s very important to us to provide a level of confidence and trust to the families and future policy holders that the stem cells will be stored in appropriate conditions in the future so that they can be used in the future.
So, Biovault is our first client and our first referral agent and Biovault is one of the most accredited cord blood banks in the world, they have around 25,000 cord blood samples stored in the UK, Spain and a couple of other countries. The way that it works is for all new clients that are now storing stem cells with Biovault, they will be having the first-year policy included in the storage service which means that all new clients Biovault will be paying the first-year policy to them and then it’s our responsibility, CellPlan to retain those. In terms of existing clients that had already stored their stem cells with Biovault, we have developed a particular strategic marketing strategy to make now the product available to the existing clients as well and tell them that they made a good decision 5 or 10 years ago when they decided to store the stem cells. 10 years ago, we had around 20 diseases that could be treated with umbilical cord blood stem cells and nowadays we have more than 80 so it’s really important to have an insurance plan that can make stem cell treatments affordable in case they need it in the future, that’s what the CellPlan is resolving.
Now, we have the other route to market which is any cord blood bank in the UK that meets our criteria and although it’s not a CellPlan Excel member but it meets the quality standards of the CellPlan Excel membership, families that have stored their stem cells with them are able to purchase the CellPlan insurance cover directly through our e-commerce platform that will be available now in the upcoming weeks, in July. This means that we have extended our reach and more families can now benefit from this great product that we have developed and the great technology of stem cell treatment.
Q3: Ultimately, this launch now means maiden results from CellPlan are expected imminently. What terms can Widecells Group look to generate or receive?
A3: Well, if we consider that there are 3 million people in the world that have already stored their baby’s stem cells and there are around 2 million of these families have stored stem cells in cord blood banks that meet our criteria. If we look at our marketing roll-out plan, starting in the UK, and launching the products anywhere between 10-15 markets in the next year, starting with the UK, the insurance average price, the gross premium is £170, we generate around £50 per insurance policy sold. We are targeting around 10,000 policies in the first year, 30,000 in the second year and 60,000 in the third year and because this is reoccurring revenue, we are accumulating a database of clients and we believe we are going to have high retention rates. For that reason, we believe that by the end of the third year, following product launch that is happening today, we are expecting to have around 100,000 insurance policies sold, generating £50 in each of these insurance policies.
Q4: Finally, you say that your agreement with Biovault to provide a benchmark for future agreements with other cord blood storage facilities, does this mean there are other agreements in the pipeline for Widecells Group?
A4: Yes, we are experiencing more demand in the last few months that what we were expecting when we floated in July last year which means we are negotiating contracts in all continents at the moment, not only in Europe, we’ve a large high-accredited cord blood storage facility so that we can provide insurance coverage for their existing clients and new clients.
Now, if we look at Biovault’s agreement, Biovault is paying for the first-year policy for all their new clients which means we have a steady revenue stream. Each time we enter into an agreement with a new cord blood bank all new clients will be offered CellPlan and instead of selling the product directly to them, we have entered into an agreement directly with the cord blood bank so that provides more stability in our revenues.
Obviously, as I mentioned previously about the 3 million that we will be able to insure, we have developed strategic marketing campaigns to target these clients in different regions of the world and it’s all starting the moment the e-commerce platform goes live in a couple of weeks’ time.