Noteworthy M&A Transactions - August 2018

SEP 14
August 2018 M&A activity highlighted continued momentum on several compelling themes:
  1. Investor interest in autism service providers remains strong. The prevalence of Autism Spectrum Disorder (ADS) has increased 119% since 2000, affecting an estimated one in 59 children, with hundreds of small service providers specializing in ADS emerging to satisfy the increased market demand for care. Additionally, 46 states have laws mandating the coverage of autism services for commercial payers.  With favorable reimbursement tailwinds underpinning a highly fragmented and emerging market, investors are actively pursuing scalable opportunities to drive cost-reduction through consolidation of these platforms.
  2. Consumer engagement platforms are a growing focus as a catalyst to drive cost-savings across the healthcare system. Amidst the backdrop of an industry-wide shift to value-based care, payers and providers alike continue to embrace innovative platforms fostering patient engagement to enhance quality of care while reducing costs. Platforms providing transparency, incentives, and personalization are attracting attention from financial sponsors and strategic acquirers, who seek to position themselves at the forefront of this rapid shift in care delivery and reimbursement.
  3. Continued healthcare market disruption presents opportunities for non-traditional strategic acquirers. Many non-healthcare players continue to see the current healthcare delivery system as opaque and inefficient and seek to enter the healthcare market inorganically, using existing capacity and scale to create value. These firms target scalable, innovative healthcare platforms that present natural synergies, while also offering disruptive capabilities.  As competition for these deals intensifies, attractive targets continue to draw considerable valuations. 

Several transactions announced in August align with these themes:
  • WebMD, a subsidiary of Internet Brands, acquired Vitals Consumer Services Division from MDx Medical. Vitals Consumer Services Division is a provider of online tools that help consumers find the right healthcare providers and connect with other patients through their websites and It also includes MedHelp, a collection of online patient-to-patient communities. MDx Medical will retain the Vitals Enterprise Solutions business, a digital engagement platform that reduces the cost of healthcare for health plans and employers. The combined platform will foster consumer engagement by creating an easier experience for the 10 million combined visitors per month seeking to shop for a healthcare provider.
  • Global Payments (NYSE: GPN), a provider of payment technology and software solutions, acquired AdvancedMD for $700M from Marlin Equity Partners. Global Payments is a leading provider of payment technology and software solutions, while AdvancedMD provides cloud-based SaaS solutions to ambulatory physician practices. This acquisition will expand Global Payments’ technology-enabled payments strategy while adding significant SaaS revenue into a new market and allow the firm to capitalize on the continued disruption within the healthcare space.
  • GoodRx, a consumer drug transparency and education platform, received a growth equity investment from SilverLake Partners. They join existing investors Francisco Partners and Spectrum Equity to help drive the next phase of growth. GoodRx has over 10 million monthly users and has experienced tremendous success and widespread adoption since the company was founded, with users saving a combined $6.5 billion in healthcare costs along with one third of doctors providing information about the platform to their patients.
  • Vista Equity Partners acquired Alegeus, a provider of consumer-directed healthcare, from Lightyear Capital. Alegeus offers a comprehensive platform for the administration of healthcare benefit accounts, has the industry’s most widely-used benefit debit card, and provides engagement solutions to help consumers maximize savings.  Vista plans to help the company scale and foster innovation of the platform.
  • Best Buy has agreed to acquire GreatCall, a developer and retailer of senior-friendly smartphones, smartwatches, medical alert devices and other senior-support technology, for $800M in cash. The acquisition supports Best Buy’s push into the healthcare market, with a focused approach that keeps seniors active and in their homes, while building a new type of relationship with consumers and payers.
  • SOC Telemed, a leader in acute care telemedicine, has acquired JSA Health. SOC Telemed is the largest national provider of telemedicine technology and solutions to hospitals, while JSA Health is a behavioral health telemedicine company.  The acquisition secures SOC Telemed’s position as the largest acute telepsychiatry provider in the nation and helps address the desperate shortage of psychiatrists in the U.S.
  • Caravel Autism Health, a leading provider of Applied Behavioral Analysis therapy to children on the Autism spectrum, announced a strategic investment by Frazier Healthcare Partners. The investment allows Caravel to pursue geographic expansion, explore additional treatment models, and invest in technology initiatives.
TripleTree and TT Capital Partners continuously monitor the market to identify the forces and themes impacting the healthcare industry.  Thanks for reading and as always, let us know your thoughts.
John Bjorklund
Matt Schiefelbein
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