REG - Kooth PLC - Significant US contract in California

KoothAnnouncement

16/03/2023 07:00

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RNS Number : 1424T  Kooth PLC  16 March 2023

16 March 2023

Kooth plc

("Kooth" or the "Group")

Significant US contract in California

 

Contract sees Kooth selected as the primary vendor partner to deliver its
digital mental health platform to all 13-25 year olds in California

 

Kooth, a global leader in youth digital mental well-being, is delighted to
announce that it has been selected as the primary vendor partner by the
California Department of Health Care Services ("DHCS") to deliver its digital
mental well-being platform for children and young adults (ages 13-25) as part
of California Governor Gavin Newsom's $4.7 billion investment in youth
behavioral health, the Master Plan for Kids' Mental Health
(https://www.gov.ca.gov/wp-content/uploads/2022/08/KidsMentalHealthMasterPlan_8.18.22.pdf?emrc=6d3847)
, and the Children and Youth Behavioral Health Initiative ("CYBHI"), (overall,
the "Contract"). The Contract is subject to definitive legal documentation
over the coming weeks, following which a further announcement will be made.

 

The DHCS announcement can be viewed at the foot of this announcement.

 

Under the Contract, Kooth will provide services integral to the Behavioral
Health Virtual Services Platform (the "Platform"), a new technology-enabled
services solution, for all children, youth, and families in California (the
"State"). The Platform is one of 15 workstreams within the CYBHI. In awarding
a primary vendor, the DHCS vetted more than 450 different providers with
existing digital behavioral health platforms and content. This was done
through an extensive market search, a Request for Information process, and
numerous company demonstrations.

With a population of six million 13-25 year olds, there is a clear imperative
to transform mental health support in California. More than 284,000 youth in
the State cope with major depression, while 66% of those with depression
currently do not, or are unable to, receive treatment. There is also an
increasing suicide rate in children between 10-18 in the State, with a 20%
increase between 2019-2020.

As part of the Contract, Kooth will be working with the DHCS and the youth of
California to extend Kooth's existing platform with a mobile app and
additional capabilities that provide a welcoming, safe, and stigma-free space
for behavioral health support, in multiple languages, with no waiting lists,
qualifying criteria, or cost to end users. The service is expected to launch
in January 2024. At this time, Kooth is unable to disclose the value or
length of the Contract, as specific terms of the Contract are yet to be
finalised.

 

In the UK, the Group provides services to nearly eight million children and
young people, with this new DHCS contract anticipated to offer services to an
additional six million youth. The Group expects the Contract details to be
agreed with DHCS during the course of Q2 2023, with an associated highly
material impact on revenues and ARR from 2024 onwards.

This is Kooth's second significant contract in the US, following the
announcement of a pilot contract with the State of Pennsylvania in September
2022. Kooth has also already identified additional opportunities in the US, a
key market for future growth, underlining the scale of opportunity in the
world's largest health care market and the Group's ability to localise its
services internationally.

 

Tim Barker, Chief Executive Officer of Kooth, said:

"Kooth was founded on the vision that to address the growing demand and cost
of mental health care, systems would need to move upstream from a
treatment-based approach to a clear focus on early intervention. In addition,
as 75% of lifelong mental health issues start by the age of 25, there needs to
be a greater emphasis on supporting children and young people. We are
delighted that California's Department of Health Care Services shares this
vision with us. We're excited to bring our service to the youth of California
to help deliver free, statewide, behavioral health care for all 13-25 year
olds.

 

"This contract has the opportunity to be a step change in both our work in the
US and indeed more broadly as we continue to grow and scale our user base to
help ever more people. It also highlights the clear value our partners see in
our expertise, with an unmatched 15 years of operating experience and evidence
allowing us to be a world leader in our field. We will now work with the DHCS
to agree the terms of this contract and begin the set up needed to allow us to
launch in January. We are very excited to bring more news to the market when
we are able to do so."

 

The information contained within this announcement is considered to constitute
inside information as stipulated under Article 7 of the Market Abuse
Regulation (EU) no. 596/2014 as incorporated into UK domestic law by virtue of
the European Union (Withdrawal) Act 2018 ("UK MAR").

 

Further details can be found here:
https://www.dhcs.ca.gov/formsandpubs/publications/oc/Documents/2023/23-13-CYBHI-3-15-23.pdf
(https://www.dhcs.ca.gov/formsandpubs/publications/oc/Documents/2023/23-13-CYBHI-3-15-23.pdf)

- Ends -

 

 

Enquiries:

 Kooth plc                                                  investorrelations@kooth.com (mailto:investorrelations@kooth.com)
 Tim Barker, CEO
 Sanjay Jawa, CFO

 Panmure Gordon, Nominated Adviser and Joint Broker

 Corporate Finance:                                         +44 (0) 20 7886 2500

 Dominic Morley, James Sinclair-Ford
 Corporate Broking:

 Rupert Dearden

 Stifel, Joint Broker                                       +44 (0) 20 7710 7600
 Ben Maddison, Nick Adams, Nicholas Harland, Richard Short

 FTI Consulting                                             kooth@fticonsulting.com (mailto:kooth@fticonsulting.com)
 Jamie Ricketts, Alex Shaw, Usama Ali

 

 

 

 

# # #

 

About Kooth plc:

 

Kooth (AIM:KOO) is a global leader in youth digital mental well-being. Our
mission is to provide accessible and safe spaces for everyone to achieve
better mental health. Our platform is clinically robust and accredited to
provide a range of therapeutic support and interventions. All our services are
predicated on easy access to make early intervention and prevention a reality.

 

Our three services are:

 

·    Kooth: for children and young persons

·    Kooth: for adults

·    Kooth Work: for frontline employees

 

Kooth is a fully safeguarded and pre-moderated community with a library of
peer and professional created content, alongside access to experienced online
counsellors. There are no thresholds for support and no waiting lists.
Currently, Kooth sees more than 4,000 logins a day.

 

 

Kooth is the only digital mental health provider to hold a UK-wide
accreditation from the British Association of Counselling and Psychotherapy
(BACP) and according to NHS England data for 2021/22 is now the largest single
access provider for mental health support for under 18s

 

In 2021, Kooth began executing on its international expansion strategy, with
an initial focus on the US market. This focus is due to the growing
recognition of the importance of improving youth mental health in this key
global healthcare market, with 1-in-6 people aged 6-17 experiencing a mental
health disorder each year. Kooth's first pilot contract in the US was signed
in October 2022 with the State of Pennsylvania.

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