- Healthcare Growth Partners’ (HGP) summary of Health IT/digital health mergers & acquisition (M&A) activity, and public company performance during the month of August 2020.
M&A is back and the velocity of the rebound has outpaced all expectations. The recovery quickly worked its way across the spectrum from large to small-cap, beginning with the larger cap NASDAQ rally of nearly 80% from lows in late March (only to soften in recent days), followed by multi-billion dollar recapitalizations of the likes of WellSky, QGenda, and Edifecs, thereafter a wave of large-cap M&A, including Teladoc-Livongo and Waystar-eSolutions, and capped off by a resurgence of small-cap M&A transactions. Taken together, the pace of Health IT M&A and Buyout transactions during the months of June through August is exceeding that of 2019 at an ever-increasing rate. Based on our own experience of deal activity, we see this acceleration continuing through the rest of the year. A flood of capital, rock bottom interest rates, looming tax hikes, a reinforced digital health investment thesis, and the proven resiliency of the recession-proof healthcare system results in strong fundamentals for health IT, notwithstanding the precarious macroeconomic picture.
Noteworthy News Headlines
HHS’ chief information officer, José Arrieta, resigned unexpectedly August 14. He departs just four months after the department stood up the public data sharing hub HHS Protect, and a little over a year since he took over as chief information officer.
GoodRx, a company that helps consumers access prescription drugs at a discount, filed to go public on August 28. GoodRx has one thing these other fast-growing companies do not: A record of consistent profitability. According to the filing, the company earned $55 million in profit for first half of 2020, up from $31 million in the first half of 2019 — a jump of 75%. Revenues for the first half of 2020 were $257 million, up from $173 million in the first half of 2019, for growth of 48%.
President Trump is expanding access to telehealth services and ensuring continued access to healthcare for rural americans.
R1 RCM, one of the nation’s largest medical debt collection companies, has been hit in a ransomware attack.
Epic Systems is now allowing its thousands of employees the option to continue working from home through the end of 2020. The move is a reversal from a plan that would have begun a phased return to in-person work for many of the company’s approximately 10,000 employees in late August. It comes after many employees publicly pushed back against the plan over concerns it was arbitrary and could jeopardize their health and the health of the community during the COVID-19 pandemic.
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Virginia has rolled out a smartphone app to automatically notify people if they might have been exposed to the coronavirus, becoming the first U.S. state to use new pandemic technology created by Apple and Google.
Source: Hit Consultant
