Hey Healthy Musers!
- Last week’s edition covered one year into the pandemic, Ambulnz’s going public, a bad press week for nursing homes, an interesting read on hospital consolidation, and more. (Link)
healthy muse healthcare news.
- Another big (private) digital health merger between Grand Rounds and Doctor on Demand, Ro raises $500 million (!!!), Amazon Care’s effect on telehealth firms, vaccinations are trending up, cases are stabilizing, 1 in 6 Americans are vaccinated, MA player Agilon Health is going public, a request for antitrust review of Change Healthcare’s acquisition, and more lit healthcare news.
Grand Rounds merges with Doctor on Demand in multi-billion dollar deal.
More digital health conglomerates: Grand Rounds and Doctor on Demand reached an agreement this week to merge into what most would expect to be a multi-billion dollar company. The synergies are interesting here, as Grand Rounds provides patient navigation services (AKA, a direct competitor to recently gone-public Accolade) while Doctor on Demand is a telehealth service.
Broader trend: Like I’ve touched on before, these digital health firms are coagulating in efforts to differentiate themselves from one another. Think Teladoc-Livongo. Boom – immediately synergistic to each other and a much more compelling offering to employers. Uphealth and Cloudbreak, Teladoc-Livongo, now Grand Rounds and Doctor on Demand.
- I’m predicting a few publicly traded health tech firm mergers in 2021+ as they try to stay ahead.
In other digital health unicorn news…Ro just announced a $500 million capital raise at a $5 billion valuation. Interesting that the firm is opting to stay private when so many other telehealth peers have gone public recently – namely, Hims and Hers, which is essentially a direct peer to Ro. (Link – soft paywall)
The Amazon Effect on Telehealth.
Shares of publicly traded telehealth firms plummeted after Amazon announced the nationwide rollout of its telehealth platform Amazon Care. (Covered in the March 8th edition).
Amid a wider market selloff, here’s how telehealth related firms have performed over the past month of trading:
- Teladoc: -31%
- HIMS: -26%
- Amwell: -30%
- GoodRx: -33%
The question is…is this a fire sale, or a problem for telehealth firms? Other Amazon announcements have resulted in stock selloffs, so this is nothing new.
- Grocers plummeted after Amazon announced its Whole Foods acquisition.
- Then don’t forget about retail pharmacies dropping after Amazon’s move into the pharmacy space.
GoodRx in particular has been getting hammered given its seemingly-delicate positioning between Amazon Pharmacy and now Amazon Care.
- It’ll be interesting to see how telehealth firms deal with increasing competition and whether there will be multiple winners in the space as firms differentiate in order to create compelling, sustainable competitive advantages.
Coronavirus updates.
Cases: Tapered off over the past week. The U.S. seven day average is 54k – almost exactly the same as last week’s report – as of this writing. (Link)
Vaccines: are trending at 2.5 million per day, up from last week’s 7-day average of 2.4 million. (Link).
- 1 in 6 people in the U.S. have been vaccinated. (Link)
- AstraZeneca’s phase 3 data came out extremely positive – meaning that the vaccine is safe and effective despite what you may have heard. (Link)
- More POC are adopting the vaccine, which is great news. (Link)
Quick Hits
Biz Hits
Agilon Health: Yet another Medicare Advantage managed care player located primarily in Ohio – Agilon Health – is going public soon. Kevin O’Leary had a great summary of the business in his weekly write-up; highly recommend a read. (Link)
Antitrust Review: The AHA released a statement urging federal regulators to review the acquisition of Change Healthcare by UnitedHealthcare’s subsidiary Optum. The AHA asserted that the acquisition would create extremely anticompetitive behavior in the health IT space. Pretty interesting stuff here to keep an eye on. (Link)
Mental Health: Virtual behavioral healthcare skyrocketed last year as COVID-19 stressed US mental health. (Link)
Transparency: A big story out from the WSJ this week asserts that several large hospital chains are preventing their required price transparency data disclosures from being indexed by search engines. Who could have seen this industry opposition coming for extremely closely held trade secrets? In addition, ~65% of hospitals are reportedly non-compliant with the price transparency rule. (Link) (Link to Non-paywall write-up)
Private Equity: Bain released its annual Healthcare Private Equity and M&A report. I always find it a good read. (Link)
Policy Hits
Appointments: The Senate confirmed Xavier Becerra this week essentially on party lines, 50-49. Many Republicans did not see Becerra as having enough healthcare experience. He’s also extremely unpopular among pro-life advocates. The contention here is notable. (Link)
Sequester: The House just passed a bill that would extend the Medicare sequester cuts until December (AKA, more $$$ reimbursement for now for providers). (Link)
Public Option: Now that Biden accomplished a major healthcare campaign goal by expanding subsidies for the ACA, the public option is on the table. But according to Politico, Democrats are treading lightly on unveiling the public option. (Link)
Antitrust: Per the WSJ, the FTC is preparing to take a tougher stance on pharmaceutical mergers. In general, you should expect more regulation from the change in regimes. (Link – paywall)
Other Hits
mRNA: The next fight for mRNA vaccines? Cancer. LFG. (Link)
Telehealth: Growth in telehealth during the pandemic was mainly in urban, upscale areas. (Link)
Thought-Provoking Editorials
Insurance: How Health Insurance Became America’s Biggest Hustle. (Link) – soft paywall
‘Rona: 3 Ways the Pandemic Has Made the World Better. (Link) – soft paywall
Costs: Obamacare Has Doubled the Cost of Individual Health Insurance. (Link)
Healthy Muse Top Picks
From the Substack legion:
- Nikhil Krishnan’s latest was an enjoyable, thoughtful read on how tech is changing the way clinics are designed, laid out, and the future of the ‘clinic.’ (Link)
- A heavy-hearted topic this week: Cultural Barriers for Asian-Americans in Healthcare. (Link)
- This was a great read from Brendan Keeler on the emergence of the personal health record and how healthcare is catching up to the fintech revolution. (Link)
CEO Profile: Read this (unfortunately paywalled) profile of current-CEO of CVS Karen Lynch. (Link)
Fraud: Inside the story of uBiome, the failed poop-testing startup that kind of stinks of Theranos-level fraud. (Paywall – Inside)
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