Midweek roundup: Transcarent closes Accolade; Walgreens beats Street; New Mountain Capital’s Office Ally buy-in; Neuralink Blindsight human trial coming up; PM Keir Starmer touts NHS data research; FTC’s PBM litigation break

April 10, 2025 | by

Transcarent closes Accolade buy, changes its game. Transcarent’s $621 million acquisition of Accolade was wrapped up in record time (two months from announcement). This takes the Nasdaq-listed Accolade private and rewards its former shareholders with $7.03 in cash. For a stock that peaked in late December 2020 into January 2021 above $59.00, and within the past year was above $9.00, this was salvage not profit except for speculators. The combined company in corporate care management now has 20 million members and more than 1,700 employer and health plan clients.

Notably, and very much in keeping with Glen Tullman’s M.O., the lead in their release is a new and rather generic marketing statement: “one place for health and care”. Much space is devoted to combinations: Transcarent’s generative AI WayFinding with Accolade’s True Health Actions member database to deliver clinical guidance to members. Transcarent also is promoting its generative AI as reducing the administrative burden for clinicians. The combined company is merging executive teams and much of its software. But the reality is combining two companies with clearly opposing care management products: Transcarent with a cost-saving, software-based, risk pricing model for self-insured employers, Accolade with a traditional human-based per member per month service model incorporating corporate care navigators and benefits consultants. Neither Accolade CEO Rajeev Singh, nor other members of top management whose shares fully vested (Stephen Barnes, Robert Cavanaugh, and Richard Eskew), are not listed in the new management lineup, though earlier information indicated that retention bonuses were offered. CNBC, Mobihealthnews  Also TTA 19 Feb reviewing MedCityNews’ Arundhati Parmar’s take on the combo and updated background TTA 21 Feb.

Walgreens beats Street analyst expectations on revenue, narrows losses. Winding up its public financial reports before the Sycamore Partners acquisition is finalized, Walgreens reported on Tuesday their fiscal Q2. Revenue was up 4% versus prior year to $38.6 billion. Losses were reduced to $2.9 billion versus prior year’s $5.9 billion loss. Per share losses were $3.30 versus $6.85. The year-ago loss included a $12.4 billion non-cash impairment charge related to VillageMD goodwill, which resulted in a $5.8 billion charge attributable to WBA, net of tax and non-controlling interest, and a $455 million non-cash impairment charge related to certain long-lived assets in the U.S. Retail Pharmacy segment. Operating cash flow in the current quarter was negatively impacted by $969 million of legal payments primarily related to PWN/Everly Health [$595 million, TTA 26 Feb] and multiple opioid-related settlements. WBA also withdrew 2025 financial guidance with the sale pending by end of year.  Release, Healthcare Dive

VC New Mountain Capital makes investment in Office Ally. The NMC “strategic growth investment” in the practice management/payment clearinghouse/EHR company is alongside Francisco Partners, which will also reinvest alongside management. The investment amount is not disclosed. Vancouver, Washington-based Office Ally enables the exchange of more than 950 million transactions and works with 80,000 healthcare organizations. For the $55 billion in assets NMC, this was evidently a better investment than their quickly terminated bid for 23andMe. Release

Neuralink’s next move–overcoming blindness. The Elon Musk-backed brain-computer interface (BCI) company announced at a Wisconsin town hall streamed on YouTube that its Blindsight implant will be tested in humans by the end of 2025. “Neuralink has had in monkeys a working device we call Blindsight,” Musk said. “It has been working well, and the monkeys are healthy for a few years now.” (The video clip is at 6:15 in this independently produced Neura Pod video, credit to Ryan Tanaka who follows Neuralink). The Blindsight implant works to restore vision in individuals who have lost sight and even their eyes or optic nerves by stimulating the visual cortex. The implant received FDA Breakthrough Device designation last September. Ironically, reviewers of Elon Musk’s Neuralink project and other brain-computer interface companies were among the 20 fired at FDA’s Office of Neurological and Physical Medicine Devices [TTA 21 Feb]. Mobihealthnews

Short takes:

NHS being ‘turbocharged’ by PM as medical research center. Prime Minister Keir Starmer took the lead on this, not the NHS, in announcing the creation of a new health data research service based on NHS data. The intent is to make all NHS data accessible through a secure single access point for national-scale data sets. The UK government and the Wellcome Trust will invest up to £600 million. This is part of the government’s Plan for Change to set up a modern industrial strategy, unlocking the potential of the Oxford‑Cambridge growth corridor, and “pro-growth measures to build a strong, resilient economy with more well-paid jobs”.  Gov.uk release

A longish break for the major pharmacy benefit management (PBM) companies. The Federal Trade Commission (FTC) announced that it was staying its insulin pricing litigation against the three major PBMs: Caremark (CVS), Express Scripts (Cigna), and Optum Rx (UnitedHealth Group). The long-running action initiated last year by the now-departed FTC chair Lina Khan ran into FTC problems with the change of administrations. First, there are not enough commissioners at present to try the case, with the firing last month of two Democrat commissioners. Republican Melissa Holyoak recused herself. The new FTC chair, Andrew Ferguson, initially recused himself since he, while Virginia solicitor general, had advised the state’s attorney general on filing an amicus brief in a class action case against PBMs. He unrecused himself on 3 April (X statement) so that the case can continue when the FTC has enough commissioners. The PBMs countersued in November. The stay is 105 days followed by evidentiary hearings 225 days later, meaning that next February is the earliest the case can resume. It’s a break for their parent healthcare companies’ share prices, which have been weighed down by the FTC action. FierceHealthcare, Healthcare Dive

News roundup 21 Feb: UHG offers buyouts to 30K before layoffs (updated); more inside the Transcarent-Accolade deal; Hims acquires NJ testing company; layoffs bite inside HHS; in fundings, Vitalchat gains $6M, Frontera seeds at $32M, Harrison.ai $112M (AU), Abridge’s $250M

February 21, 2025 | by

UnitedHealth Group ends an annus horribilis with more horribilis. UHG offered early this week 30,000 employees their “Voluntary Resignation Severance Program” or VSRP. If the employee accepts between 24 February and 3 March, the program offers anywhere from 7 to 30 weeks severance, based upon tenure and salary grade; they’ll receive their termination date on 17 March with all released by 1 May, as of now. A wrinkle: their managers must approve of their taking the package, which could set up a situation of being released later involuntarily. UHG has 420,000 employees and oddly, is still posting available positions but they may be ‘ghost’.

Reports have been compiled by employees posting largely anonymously across social media and websites such as Reddit, Facebook, LinkedIn, TikTok, and TheLayoff.com. The buyout offer, according to reports, is concentrated in the benefits operations area. According to CNBC’s sources, benefits oversees multiple subdivisions that help manage customer service, claims, enrollment, customers’ insurance benefits, and more. As is typical with voluntary severance offers, the whip is that if employees do not take the VSRP, those laid off later will receive a reduced package.  There is no information about additional benefits, such as 401(k) and incentive vesting, or healthcare benefits–the last ironic for a healthcare company.

On social media, the betting is that UHG is only the first payer to institute layoffs, with the decline in Medicare Advantage payouts and reductions in ACA subsidies. Other factors: AI (per the last earnings call, they are replacing many customer service functions with AI programs) and offshoring. This is not going to be a great year for any payer, if you work for one, and their suppliers/partners. HealthPayerSpecialist (hat tip to Mansur Shaheen via LinkedIn), FierceHealthcare, PYMNTS.com, Minneapolis Star-Tribune   A followup article by Mr. Shaheen with UHG interviewing employees and accessing company information is here. Another reason why is that UHG’s attrition rate, for various reasons including company response to the Brian Thompson murder and their higher pay rates, was much lower than forecast.

Updates on the Transcarent deal for Accolade. Contained in the latter’s SEC Schedule 14A, an announcement of a stockholder meeting (virtual) and preliminary proxy statement, are more tidbits in the runup to the deal with Transcarent:

  • Transcarent’s merger sub was formed on 3 January, indicating this deal has been on the table for some time
  • In April 2024, Accolade was considering acquiring a strategic company (unnamed). That company rejected the offer and instead offered to buy Accolade by May. Later that month into August, a special committee and outside advisors considered competing purchase offers, well over 16.
  • Transcarent’s original offer was made at end of July, was unsolicited, and an August proposal was rejected. A second proposal was rejected in September based on financing.
  • In October, after business reverses, Transcarent submitted another bid for shares at $7.25 and was delayed by the special committee 
  • Between that date and year’s end, the other proposals faded away for a variety of reasons.
  • Transcarent’s final offer was $7.03 per share and accepted in January.

Regarding transitioning incentives in the deal, expected to close in Q2:

  • It can be terminated by 7 October. If Accolade terminates it, the payment to Transcarent is $19.8 million. If Transcarent terminates, the fee to Accolade is $29,950,000
  • Top management (Rajeev Singh, Stephen Barnes, Robert Cavanaugh, and Richard Eskew) shares will accelerate in vesting. Some top management such as CEO Singh will enjoy retention bonuses.
  • It describes treatment of employee benefits such as restricted and performance stock units (RSU, PSU) being converted to cash and that other benefits for continuing employees will be cut over for a year.

Also Endpoints News

Hims & Hers buys a testing lab in NJ.  The acquisition of Sigmund NJ LLC, also known as Trybe Labs, in Kearny NJ will support at-home blood draws and more complete and affordable whole-body testing. The acquisition was self-financed and not disclosed. Hims, a telehealth prescriber for GLP-1, ED, hair loss, migraines, and anti-depressants, in the release pointed out that the Trybe Labs buy will enable them to serve high-impact clinical categories including low testosterone, perimenopausal, and menopausal support for patients and providers. Through using a blood lancet, they will test for hormone levels, cardiac risk, stress markers, cholesterol, liver function, thyroid function, and prostate health. Mobihealthnews, Endpoints News

Layoffs within HHS are extensive–and as of a court action today, going through. Most of those eliminated by DOGE (Department of Government Efficiency) are probationary hires–in their first year–and some in year two. Those released at HHS include 1,300 at the Centers for Disease Control and the National Institute of Health (unknown but expected to be upwards of 600). Those released will have a month’s severance but will end work on Friday 14 February. Some probationary NIH employees will be retained. Cuts include CDC and other HHS contract workers and include dozens at the Vaccine Research Center housed at NIH. The current acting principal deputy director, Nirav Shah, will be departing on 28 February as will Renee Wegrzyn, the appointed head of Advanced Research Projects Agency for Health (ARPA-H), which performs biomedical research in conjunction with the private sector established in 2022 by the last administration. Ironically, reviewers of Elon Musk’s Neuralink project and other brain-computer interface companies were among the 20 fired at FDA’s Office of Neurological and Physical Medicine Devices.

HHS employs more than 80,000 people across multiple agencies and has a budget of $1.8 trillion. NIH alone has 20,000 people and has a $47 billion annual budget. STAT, Mobihealthnews

Funding highlights include a stunning seed round:

  • Vitalchat, a provider of in-patient virtual nursing and procedural telehealth, closed a $6 million Series A round. Investors were led by Green Harvest Capital Industries (GHC Industries). Two of their principals will join the Vitalchat board: Ankit Patel, GHC’s CEO, and Saagar Parikh, co-founder/principal. The new funds will be used for product innovation, market expansion, and deeper AI integration into clinical workflows for its AI-assisted virtual sitters. Release
  • Frontera Health’s seed round of $32 million was a return to 2020’s Big Raises. It was co-led by Lux Capital and Lightspeed Venture Partners, with Bison Ventures, Menlo Ventures, and Inspired Capital participating. Frontera specializes in autism services, including virtual autism diagnosis and assessments, as well as in-home and center-based ABA therapy. It uses what they call ‘digital phenotyping’ to analyze interactions and behaviors, providing real-time cognitive reasoning and objective data points for clinical assessments. Behavioral Health Business noted substantial raises by other companies such as Anna Health and Prosper Health, along with private equity (PE) investments.  Release, Mobihealthnews
  • Down Under, Harrison.ai’s Series C totaled $112 million in a Series C funding. It was led by Aware Super, ECP, and Horizons Ventures. It provides medical imaging diagnostic support in radiology and pathology, including workflow solutions. Harrison is opening a US headquarters in Boston to expand their US business. It already has clients in APAC, EMEA, UK, and US, where it has 12 FDA clearances. One of their CT brain algorithms has FDA Breakthrough Device Designation and Medicare reimbursement through the New Technology Add-on Payment (NTAP).   Release, Mobihealthnews
  • Abridge raised an old-school level $250 million Series D investment. This was co-led by Elad Gil and IVP, with a long list of participants including Bessemer Venture Partners, California Health Care Foundation, CapitalG, CVS Health Ventures, K. Ventures, Lightspeed Venture Partners, NVentures (NVIDIA’s venture capital arm), Redpoint Ventures, Spark Capital, and SV Angel. Abridge’s platform converts patient/clinician conversations into structured clinical notes in real time using (guess) generative AI. Funding will be used to further develop AI capabilities and commercial growth to support broader applications. It claims 100 of the largest and most complex healthcare systems in the US, from rural systems to children’s hospitals, leading academic systems, and nationally recognized cancer centers, Release

Two Must Reads: What’s Glen Tullman’s real game with Transcarent and the Accolade buy? (updated) Plus an extra helping on the VC ‘mafia’ and Hippocratic AI.

February 19, 2025 | by

Make some time over the morning cuppa or lunch for a brilliant investigative report on Transcarent and Glen Tullman. Arundhati Parmar over at MedCity News pulls aside some of those Great Oz curtains, surveys the scene, then asks the questions that few have dared to. Such as:

  • Is Transcarent’s model not working? Are they successful or not?
  • Or are those corporations and benefits consultants so hidebound, so powerful, so exclusive, that they forced Glen Tullman to buy into the traditional care navigation model–and he is a Victim of the System?

Those of us in the healthtech/digital health industry have looked with amazement, mixed with dismay, at Mr. Tullman. The amazement is the powerful voice he has among us, reinforced by his investment funds. The dismay comes from the $18 billion sale of Livongo to Teladoc in the palmy days of 2020. As we reported, even then it was regarded as a dubious move. It then became a case study in What Not To Buy–Or Do. From Mr. Tullman’s and his management’s perspective, Teladoc’s offer proved to be Grand Theft Auto. In other words, a heist to end all heists. For Teladoc, it was a disaster. Mr. Gorevic, as we know, is gone and Teladoc is rebuilding. In many ways, Teladoc has never recovered and may never. 

Mr. Tullman, who founded two VCs, 7wireVentures and most recently 62 Ventures, after selling Livongo almost at once founded Transcarent with a vision that it would do the job through software that human corporate care navigators and benefits consultants couldn’t do–take out all these middlemen and deliver to both companies and their employees better quality healthcare at a much lower cost. It would also turn the PMPM (per member per month) pricing scheme into a risk-sharing model based on use. He made the rounds at every conference pitching against traditional care navigators, including the most prominent, Accolade.

Last month, he and Transcarent made a substantial offer to buy, yes, Accolade, for $621 million [TTA 8 Jan]. Publicly traded and struggling for years, recently losing major accounts, Accolade was on the block–yet its model is so different than Transcarent’s that it feels like double vision. In fact, this deal had been in the works since last July–initiated by Glen Tullman. Why?

A clue from one of Ms. Parmar’s sources, most of whom have had to be anonymous for obvious reasons:

“He is an amazing storyteller and amateur magician. But like any story and magic trick, sometimes it’s hard to tell what is real and the trick doesn’t work. ”

Ms. Parmar’s path to answering these questions is top notch, and this Editor invites you to read it, start to finish–and return to it again. When you finish it, you’ll not only know about Transcarent’s current business realities, but also learn a great deal about how companies regard care navigation plus the economics. The discrepancy, as always, is between the ‘vision’ and reality. Is he in it for the mission, or has reality bitten? Is Glen Tullman a Hypocrite or a Victim of the System He Aimed to Disrupt? (I also want to commend MedCity News for publishing this)

Update: See Ms. Parmar’s video on LinkedIn regarding the response to her article. Of note: 1) the complete lack of response from Transcarent’s corporate communications team*. 2) If you want investigative journalism, you have to be willing to be a source, so when you see something wrong, you have to reach out. That means risk. (*No surprise to this Editor, who directly contacted Transcarent’s corporate comms team to clarify whether 98point6’s telehealth service, purchased for $100 million, still was operating–no reply to this simple ‘layup’. TTA 5 Feb)

Our ‘extra of the day’ is from AI Health Uncut. Sergei Polevikov, publishing on Substack, puts on the scuba gear and dives deep not only into Hippocratic AI, which promotes AI agents for various types of healthcare contact requirements, but also its key funder, General Catalyst and its head, Hemant Taneja. For starters: Hippocratic AI is the most expensive AI company on Planet Earth if viewed as valuation x revenue multiple. Mr. P brings the numbers and the heat.

If you’ve looked at fundings in the past two years, versus the ‘olden days’, and wonder why the same names always seem to pop up, it is because VC fundings have become concentrated among very few companies. As this Editor noted in the Rock Health 2024 results, of 391 VC funds, 30 raised 75% of all US committed capital. Nine of those funds accounted for 50% (Pitchbook). Sitting at or near the top is General Catalyst, which has moved into wealth management and through HATco, owning hospitals such as Summa Health. But there are other reasons as well, and Mr. Polevikov gets into the murk.  It’s another one for a long cuppa or lunch. And it is part one of two, upcoming!

I encourage our Readers to support Sergei’s work on Substack–for a modest annual subscription amount, you gain full access to his work, past and present, charts, videos, and articles. (I did, and have noted his site among Websites We Like.) The link above may be paywalled as a result for non-subscribers. [Disclaimer: through commenting in this article, I pointed out GC’s move into GC Wealth, and my short news item is linked.] He also recently posted a lively panel discussion video with Alex Koshykov, Matthew Holt, and James Wang.  

2025 is proving to be a year of massive change in healthcare. It may be a year of comeuppance for those we’ve regarded as all powerful and fearsome. Yes, the cliché ‘sunshine is the best disinfectant’ is true, but a good dose of hydrogen peroxide, boric acid, or Lysol helps.

News roundup #2: why Walgreens is considering selling to a PE, December fundings, 2024’s surprises, M&A ’25 predictions, Transcarent buying Accolade for $621M

January 8, 2025 | by

Why would Walgreens sell out to a private equity investor, reportedly Sycamore Partners? This news leaked early in December to the Wall Street Journal that this PE would either buy Walgreens Boots Alliance (WBA) in whole, in parts, or with partners [TTA 10 Dec 2024]. This MedCityNews article gathers the speculation from multiple financial executives, and the answer is a resounding Maybe.

  • Primary care was a losing bet–and their retail pharmacies are challenged by new models like Amazon Pharmacy and Cost Plus.
  • It will take about $9.2 to $10 billion, which is a lot for Sycamore to pony up. But it’s a bargain from what PE giant KKR offered in 2019– $70 billion.
  • Sycamore may have competition for buying WBA.
  • The 12,000 store network is now seen not as an asset, but a liability, not only for pharmacy but also for retail goods.
  • Sycamore may be more interested in the retail and e-commerce sides of Walgreens versus healthcare. For instance, WBA company Boots in the UK has leveraged its beauty business to nearly the prominence of health in their stores.
  • A private company may have more power to swiftly make the changes that Walgreens needs, versus a company having to report quarterly to shareholders. 

There was the usual rush to announce fundings by December’s end, a refreshing change from 2023’s end. MedCityNews helpfully rounded up five of the last-minute closings:

  • Already noted: Oura’s $200 million plus funding for a Series D from Dexcom ($75 million) and Fidelity Management. Our earlier reporting noted total financing at $223 million and the valuation at $5 billion.
  • Cleerly’s $106 million Series C led by Insight Partners. Cleerly developed AI-assisted detailed phenotyping of coronary artery disease.
  • Remodel Health gained $100 million in a funding led by Oak HC/FT and Hercules Capital. Remodel works with employers and employees to build and access Individual Coverage Health Reimbursement Arrangement (ICHRA) plans.
  • Cala Health raised $50 million from Vertex Growth Fund and Nexus NeuroTech Ventures. Cala is a bioelectronic medicine company which developed FDA-cleared, noninvasive devices for hand tremors.
  • Soda Health’s $50 million Series B, led by General Catalyst, is in the hot sector of ‘food as medicine’. Soda provides a ‘smart benefits’ card to use at approved retailers for food, health products, and pharmacy benefits.

2024 had its share of surprises in this two-part Mobihealthnews roundup. No surprise for our Readers in that GLP-1 drugs for weight loss went to radioactive-level hot (but this Editor predicts a collapse in 2025). The failure of retail clinics such as Walmart Health and VillageMD surprised many in the industry–as well as Optum shuttering its telehealth business. Developing: menopause and autoimmune health (and their relationship)–and food as medicine. On the insurance side, the troubles of the Medicare Advantage health plan model multiplied, not moderated. And AI? On top of everything, but you maybe shouldn’t develop your own LLM. Part One, Part Two

Predictions for 2025 mergers and acquisitions center on consolidations. There’s little foo-foo or froth in this Mobihealthnews article– instead, lots of New Reality. Many pandemic-born startups will die quiet deaths in sales, shotgun marriages, and shutdowns. Much caution in any M&A. The emphasis is on interoperability, which is widely defined as acquirer-acquiree and a clearly presented integrated value proposition to customers. Their industry leader panel cannot agree whether M&A will accelerate as a result of changes at FTC (Lina Khan’s departure and a new chair) or slow down. And at least one leader believes that Medicare Advantage will stabilize and recover.

But one buyer plays it high and wide in ’25–the deep-pocketed Transcarent, agreeing to buy Accolade for $621 million in 2025’s First Big Deal. Accolade is also in enterprise care navigation, as well as providing virtual primary care, specialist consultations, and patient advocates. It went public on Nasdaq in 2020. Transcarent’s offer is $7.03 per share in cash, an approximately 110% premium over the company’s closing stock price yesterday 7 January. The funding is coming from General Catalyst (!) and Glen Tullman’s 62 Ventures. Accolade will go private at the closing, expected to be Q2 following shareholder and regulatory approvals, and be integrated into Transcarent. The combined Transcarent will have 1,400 employer and payer clients. Release, Healthcare Dive

News roundup: Buddi’s £500M LSE float, Accolade to buy PlushCare for $450M, Teladoc adds chief innovation officer, Tyto Care’s Italy expansion

April 28, 2021 | by

Buddi going public later this year. Something we missed and found (quite by accident) was that the Buddi personal alert wearable will be floated on the London Stock Exchange later this year. According to the report in SkyNews, CEO and founder Sara Murray has appointed Zeus Capital to manage it. The value is rumored to be up to £500 million and will be a great reward for Ms. Murray and her other early investors. The bands, which connect to smartphones or a wireless-connected clip, then to pre-set connections or their 24/7 support, retail for up to £248. Buddi is reported to be used by more than 80 percent of local authorities in the UK, UK police forces for domestic violence cases and witness protection, lone worker situations, plus government customers internationally. Buddi also designs and assembles their Buddi units in the UK. Also City A.M. 

Accolade, a health benefits navigation provider, announced a definitive agreement to purchase one of the smaller telehealth players, PlushCare, for a plush price of $450 million, composed of $40 million in cash, $340 million in Accolade common stock, and up to (the usual) additional $70 million of value payable upon the achievement of defined revenue milestones following the closing, expected in June. Accolade, which itself went public on NASDAQ in July, raising $220 million, then in October floated additional shares to raise $221 million, has been on a telehealth acquisition tear of late. In March, they closed their acquisition of virtual second medical opinion provider 2nd.MD for $460 million. PlushCare will enable Accolade to directly offer primary and mental health care telehealth to its members. According to Steve Barnes, chief financial officer at Accolade, their addressable market will increase nearly five-fold to more than $200 billion. One wonders whether their existing relationships with Teladoc and Livongo will continue.  Release.  Also HealthcareDive and FierceHealthcare.

Teladoc adds a chief innovation officer. Claus Jensen, PhD comes from Memorial Sloan Kettering Cancer Center, where he served as chief digital officer and head of technology. His purview will include product innovation, information systems, health informatics, and data products. Previously, he was with Danske Bank, IBM, and chief technology officer of CVS Health-Aetna. Release, Becker’s Hospital Review

TytoCare advances further into Italy in a partnership with Multimed srl, a local medical device company. The partnership will develop the market there with local providers, hospitals, elder care facilities, independent physicians, and pharmacies, as well as at-home monitoring. Multimed is a multi-line distributor of surgical devices for robotic surgery, endoscopy, laparoscopy, orthopedics, sanitization/sterilization, and similar. Tyto earlier explored the Italian market in a partnership with the ASL of Vercelli hospital group, where physicians monitored and treated elderly and pediatric COVID-19 patients, performing pulmonary, cardiological, and dermatological telehealth visits. Release.