Friday’s really quick takes: Oracle-Cerner starts Federal reviews, Curve Health, Signify buys Caravan, and a gaggle of single name companies!

February 11, 2022 | by

The long and winding road of Federal scrutiny–and other legal actions–begin for Oracle and Cerner. To be expected, the first hurdle is a review under the Hart-Scott-Rodino Act, by the Federal Trade Commission (FTC) and the US Department of Justice (DOJ). This should conclude by 22 February. The Securities and Exchange Commission (SEC) is also reviewing. As is routine in takeovers of public companies, there are seven civil filings by ‘supposed’ Cerner stockholders in either the District Court for the Southern or Eastern District of New York, their favorite venue, all claiming lack of information. Expect more. Kansas City Business Journal (which may be paywalled), Becker’s Health IT

New York-based newcomer Curve Health scored a $12 million Series A from Morningside Ventures with participation from Alumni Ventures and Recover-Care Healthcare, as well as returning investors Lightspeed Venture Partners, IDEO, Inflect Health, and others. Total funding is now $18 million (Crunchbase). Curve Health specializes in ‘virtual hospital’ telemedicine for skilled nursing facilities (SNFs) and community paramedicine, along with billing and health information exchange. Last July, they partnered with CareConnectMD, a California-based provider group that delivers value-based care for people living in nursing homes via its High Needs Direct Contracting Entity (DCE). Curve’s founder, Tim Peck MD, previously founded Call 9, a telemedicine/onsite service for nursing homes, which closed in July 2019 [TTA 15 May 2020] Release

Signify Health, a senior home care and value-based care provider, is acquiring ACO organizer and management services provider Caravan Health in a $250 million cash/stock deal with contingent additional payments of up to $50 million based on performance. Caravan’s founder and the current CEO will be joining Signify. It’s a move that may bolster Signify, which has had a few valuation challenges, because it expands Signify’s provider base and expands its current narrow episodes of care area (the former Remedy) into additional advanced payment models. Release, Mobihealthnews

Short short takes on single-word company news….

Expressable’s remote speech teletherapy platform closed a $15 million Series A funded by F-Prime Capital and including existing investors Lerer Hippeau, NextView Ventures, and Amplifyher Ventures. The new funding will go towards national expansion. FierceHealthcare  Hat tip to this Editor’s former colleague Amy VanStee, who recently joined them.

Balanced is a new digital platform for exercise coaching targeted to older adults. Users can modify based on assessed fitness level, input injuries, health conditions, and fitness goals. They added to an early seed round to total $6.5 million in seed funding, led by Founders Fund and Primary Venture Partners, with participation from Lux Capital and Stellation Capital. Cost for unlimited use is a gentle $20 per month. Given yesterday’s near-implosion of that expensive must-have of the aggressively fit and heavily dripping, Peloton, is fitness getting real?  Mobihealthnews

AndHealth, founded by the CEO plus veterans from CoverMyMeds, now has $57 million from Francisco Partners, with participation from the American Medical Association’s venture capital arm Health 2047, Kirkland & Ellis and Twofold Ventures. AndHealth specializes in Virtual Centers of Excellence (VCOE) programs for migraine and autoimmune disease reversal programs as an employer-sponsored benefit. Release

Berlin-based Ada extended its Series B by $30 million for a total of $120 million. Ada partners with major pharma for its AI-assisted symptom assessment app. TechEU

Nurx is merging into Thirty Madison. Nurx is primarily a provider of birth control, women’s and sexual health meds via telemedicine, while Thirty Madison specializes in telemedicine for chronic conditions. Thirty Madison was valued at over $1 billion after its Series C round in June. Nurx’s lines will be added to Thirty Madison’s menu which includes Keeps (hair loss) and Evens (GI issues). FierceHealthcare

CareCentrix files ‘corporate espionage’ on trade secrets lawsuit against Signify Health, former employee

March 18, 2021 | by

Usually, laundry like this is not aired or dried in public, but it’s on the line nevertheless in a lawsuit. CareCentrix, a post-acute care/transitions of care management company, has sued in US Federal Court for the District of Delaware both Signify Health, a diversified home care company overlapping the same line of business, and CareCentrix’s former general manager, VP post-acute care Marcus Lanznar.  Initial charges were filed on 23 December and motions are piling up fast based on what is listed (paywalled, unfortunately) on PacerMonitor.

The Federal charge is covered under the Defend Trade Secrets Act of 2016 (DTSA), Cause 18:1836(a) Injunction against Misappropriation of Trade Secrets. The basics are that Mr. Lanznar was a senior executive of CareCentrix, had access to proprietary information, and had a restrictive covenant that would not allow him to go to a competitor for nine months. Yet he was engaged in interviews starting in July 2020, by August-September was having regular meetings with his counterpart, chief product officer Peter Boumenot, and passed CareCentrix information not only to his personal email but also to Signify into October, when Mr. Lanznar resigned. He joined Signify Health in November 2020 and is listed on LinkedIn as SVP product, though not on their management page. 

The lawsuit claims that Signify “targeted, recruited, and hired former CareCentrix executive Marcus Lanznar in a covert scheme that succeeded in providing access to CareCentrix’s confidential information and trade secrets” and also was aware of the conflict presented by the restrictive covenant. It seeks to prevent Mr. Lanznar and Signify Health from using its trade secrets and to award it damages and attorneys’ fees. 

This is a David versus Goliath matchup. Signify Health in February had a highly successful IPO gaining over $560 million and is valued with a market cap of over $7 bn. CareCentrix to date is most definitely the David in this scenario in terms of size, having raised all private equity funding via Summit Partners starting in 2011. However, it has made two acquisitions of its own recently: Vesta Healthcare at $30 million and Turnkey Health for an undisclosed amount (Crunchbase). The stakes are piled high in this hot segment of healthcare. 

There are a number of high-powered law firms dueling in this lawsuit, which also includes CareCentrix’s parent, NDES Holdings. Note: this article is based on both reporting in Healthcare IT News, which initially filed the story, and FierceHealthcare’s close on follow-up.

News and deal roundup, 5 March: Oscar Health’s $1.4 billion IPO, telehealth expansion in Congress, what people *really* do during a telehealth visit

March 5, 2021 | by

What a difference a month makes in a blazing healthcare market. ‘Neoinsurer’ Oscar Health went public on Tuesday, selling over 37 million shares at $39 each, reaping an eyeblinking $1.44 bn. While shares took a tumble on Wednesday and Thursday, closing at just above $32, the valuation of the company could be anywhere between $7.92 and $9.5 bn (calculating in options and the like). Quite a difference from the estimate in early February, which was a modest–and as now we know, totally sandbagged–$100 million [TTA 9 Feb]. A lovely payday for their backers and all at Oscar who had stock grants, indeed.

As we’ve seen from recent IPOs, they have all been underestimated (e.g. Signify Health’s $100 million filing transubstantiated into $561 million). The downward glide slope in share price is typical. Whether it will rise will depend very much on strong results for this quarter, half year, and full year as Oscar presses harder into the competitive Medicare Advantage, exchange, and small group markets. How they, and all the other payers do, will be dependent on health policy permutations and emanations from the DC Swamp. CNBC, TechCrunch, FierceHealthcare

Speaking of the DC Swamp, telehealth expansion is enjoying real traction in Congress and with Health and Human Services (HHS). The chair of the House Health Subcommittee, Rep. Anna Eshoo (D-Calif.) has called for many of the flexibilities on payments and locations granted temporarily during the pandemic’s liberalization of coverage to be made permanent. These affect Medicare and other types of Federal payments. [Review of the 2021 Medicare Physician Fee Schedule re telehealth here]  They expire after the public health emergency (PHE), extended in January to end of April, so a clock is ticking, quickly.

The basics are that Congress must pass legislation that removes restrictions on geography (currently rural only) and permits the patient home to be used as a ‘distant site’. Advocates also want to add to Medicare telehealth coverage hospice and home dialysis care, more types of eligible care providers such as physical therapists and other allied health professionals, and audio-only (telephonic) consults. Others are pushing for reinstating HIPAA compliance for telehealth platforms.

The Telehealth Modernization Bill that covers most of the above was introduced on 23 February in both the Senate and House, in a rare show of both bipartisanship and bicamerality. (Excluded: telephonic consults, HIPAA compliance) Rep. Eshoo’s remarks were made during last Tuesday’s Committee on Energy and Commerce Health Subcommittee hearing.

HHS is also backing this, based on HHS’ Office of the Inspector General’s recent statement praising the expansion of telehealth. Recognizing that concerns have been raised about ‘telefraud’, IG Christi Grimm noted that they have been vigorously prosecuting fraudulent claims [TTA 2 Oct 20] with telehealth being used in a broad sense for billing other goods and services such as medications and durable medical equipment. FierceHealthcare, Healthcare Dive, ATA News 26 Feb

Speaking of telehealth visits, what do the patients do during them? This Editor had filed away, waiting for an opportune moment to share it, a surprising study by DrFirst, a mobile telehealth and communications platform. It was conducted online during the Pits of the Pandemic (June 2020). It may not surprise you that most patients weren’t fully engaged in the process. Bored, isolated, mostly male patients–73 percent men, 39 percent women–multitasked and distracted themselves during the virtual visit by: 

Surfing web, checking email, texting – 24.5%
Watching the news, TV, or movie – 24%
Scrolling through social media – 21%
Eating a snack or a meal – 21%
Playing a video game – 19%
Exercising – 18%
Smoking a cigarette – 11%
Driving a car – 10% (!!!!)

And the best….Having a “quarantini” cocktail or other alcoholic beverage – 9.4%

Reasons for consults were unsurprising: annual checkup – 38%, mental health therapy – 25%, and specialist visits (e.g., dermatologist, hematologist, or oncologist) – 21%.  N=1,002 US consumers. 44% of Americans Have Used Telehealth Services During Coronavirus Pandemic but Some Admit Not Paying Attention. Also Advisory Board blog.

News and deal roundup: Signify Health’s $564M IPO, RapidSOS’ $85M Series C, Poland’s Telemedico raise, Livongo’s Zane Burke to Bardavon

February 13, 2021 | by

The Big Deal of the Week is Signify Health‘s IPO which on 11 February raised $564 million on a sale of 23.5 million shares on the NYSE. Signify provides comprehensive care and management services such as complex care management, SDOH, episodes of care/bundled care programs, and specialized medical services in the home, utilizing technology and data analytics. Signify now has a market capitalization of $7.12 bn. FierceHealthcare, MarketWatch, Signify release.

RapidSOS, an emergency response data platform that provides Next Generation 911 and Emergency Services Network services to Emergency Communication Centers, had a Series C raise of $85 million led by Insight Partners and Global Venture Capital. The RapidSOS technology in global use links 350 million connected devices to first responders and 4,800 data centers. They have raised $205.7 million over 14 rounds since 2016. Crunchbase, release

On the other side of the deal continuum, Poland’s Telemedico, a telemedicine provider in multiple European and Middle Eastern countries, raised a modest €5.5 million (~$6.6 million) in a Series A round. The round is led by Flashpoint Venture Capital, Uniqa Ventures, PKO VC, Black Pearls VC, and Adamed. Mobihealthnews, TechCrunch

And in a coda to the Telavongo story (Teladoc and Livongo), former CEO Zane Burke joined as a director of workers compensation digital health company Bardavon Health Innovations. Mr. Burke led the $18.5 billion merger with Teladoc in his two years as CEO, after 20 years at Cerner. Becker’s Health IT, release (DigitalJournal)

Funding news roundup: Philips buys Capsule, Hims’ SPAC + Privia partnership, Signify Health’s $100M IPO; closed funding for K Health, Aledade, Conversa Health

January 27, 2021 | by

Royal Philips buys Capsule Technologies for $635 million, extending their integrated solutions platforms for patient care management. Capsule is a developer of medical device integration and data technologies, including vital signs monitoring and clinical surveillance services, for hospitals and healthcare organizations. These technologies connect medical devices and EMRs in hospitals through a vendor-neutral system. The deal will close in this quarter and Capsule’s approximately 300 employees will join Philips’ connected care segment. MassDevice, Philips release.

It’s all about the integration: Hims & Hers $1.6 bn SPAC completes, partners with Privia Health for telehealth and in-person visits. Now that Hims & Hers is now on the NYSE (courtesy of a ‘blank check’ with a division of Oaktree Capital Management) and valued at $1.6 billion, it continues its elevation out of e-commerce home delivery of erectile dysfunction and hair restoration meds to telehealth and in-person medicine. Starting about 18 months ago with virtual visits for minor maladies and mental health, Hims recently went beyond its homegrown capabilities with major providers such as New Orleans-based Ochsner Health System and New York City-based Mount Sinai Health System. Privia is a physician organization consisting of regional groups, ACOs, and specialty verticals in value-based care. Their addition to Hims will be for in-person and telehealth visits in the District of Columbia, Georgia, Maryland, Texas, and Virginia. In past months, it has been eagerly partnering with technology and analytics suppliers to build its management services portfolio. Another sign of more integration: Hims is also moving into pharmacy fulfillment after using outside suppliers. Hasn’t turned the profit corner yet, though. FierceHealthcare, Mobihealthnews

Signify Health signals an IPO. Going the more traditional route is Signify Health, which filed an S-1 registration statement with the SEC for a $100 million offering on the NYSE in the near future. Signify’s analytics and technology platform delivers through its mobile provider networks in-home health and care management services supporting major payers and value-based payment programs. Signify merged in 2019 with fellow, smaller New Mountain Capital company, the former Remedy Health, which specializes in managing providers through episodes of care/bundled payments under the CMS BPCI-A and commercial programs. It is not confirmed if New Mountain, a private equity company based in New York, will be exiting with the IPO. Signify Health release, FierceHealthcare.

Closing funding rounds:

Telehealth/AI platform K Health closed a $132M Series E round of funding led by GGV Capital and Valor Equity Partners, for a total since its 2016 start of $271 million. It also launched a pediatric version of the app, K for Parents. The app connects with doctors in 49 states but also uses health data, curated by AI, to provide patients with guidance for primary care, anxiety, and depression conditions. Release

Even non-telehealth or app-based healthcare companies are taking advantage of funding bounties. Aledade, a management services organization (MSO) for primary care practices, closed a $100 million Series D led by Meritech Capital Partners. Aledade partners with independent practices to organize ACOs in value-based care models. To date, Aledade has raised $249 million. Aledade release.

More modestly, Conversa Health closed its Series B at $20 million, up from $12 million. The round was led by Builders VC and Northwell Ventures. Conversa’s automated virtual care and triage platform remotely monitors, analyzes, and communicates with patients. During COVID, they developed COVID-19 Virtual Care Solutions, a mobile platform for hospitals to increase capacity by automating the outreach to and monitoring of vulnerable patient and employee populations. Release