Market Commentary

  • Healthcare technology assets continue to garner significant interest from both strategic and financial sponsors, as increasing regulatory complexity, ongoing technology adoption by constituents across healthcare, and the pervasive evolution towards value-based care underpin growth opportunities for innovative software tools
  • Continued investor appetite for specialty and sector-specific EMR and revenue cycle management solutions, as providers demonstrate a clear preference for purpose-built, best-of-breed solutions
  • Healthcare organizations continue to extend their focus beyond price and quality of care, with an increasing focus on patient and provider engagement and educational tools
  • Sector innovations continue to target niche operational challenges including patient and staff management and monitoring, and compliance control solutions for vendors and clinicians
  • Increasingly complex reimbursement arrangements in the face of rising healthcare costs have supported strong payer interest in specialized cost containment and payment integrity solutions

Healthcare IT Taxonomy

Patient-Facing Solutions

  • Member Onboarding / Portals
  • Patient Outreach & Campaigns
  • Patient Engagement / Education
  • Digital Wellness Tools
  • Benefits & Consumer-Directed Healthcare Tools
  • Information Tools & Online Media

Select Market Participants

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Care Delivery

  • Operational Efficiency
  • Inpatient – Clinical
  • Outpatient – Clinical
  • Post-Acute – Clinical

Select Market Participants

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Pharma & Devices

  • Development
  • Trials
  • Commercialization
  • Adherence
  • Regulatory

Select Market Participants

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Revenue Cycle Management

  • Charge Capture & Coding
  • Claims Management
  • Adjudication / Appeal / Review
  • Payment Processing
  • Patient Collection
  • Other RCM Tools
  • Regulatory & Analytics

Select Market Participants

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Population Health & Risk Management

  • PHM Informatics
  • Data Aggregation & Normalization
  • Privacy / Security
  • Information Sharing / Interoperability
  • Population Analytics
  • Care Coordination

Select Market Participants

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Recent Representative HW HCIT Transactions

screen_shot_2019-01-28_at_12.36.12_pm.pngProvider of market access and formulary information to pharma, payers, and providers

 

 

 

screen_shot_2019-01-28_at_12.36.48_pm.pngProvider of healthcare credentialing and payer enrollment solutions

 

 

 

screen_shot_2019-01-28_at_12.37.14_pm.pngProvider of education and GRC solutions

 

 

 

screen_shot_2019-01-28_at_12.37.45_pm.pngProvider of SaaS solutions to the behavioral health industry

 

 

 

screen_shot_2019-01-28_at_12.38.13_pm.pngProvider of population health management solutions

 

 

 

screen_shot_2019-01-28_at_12.38.51_pm.pngProvider of incident reporting and risk management software

 

 

 

screen_shot_2019-01-28_at_12.39.32_pm.pngProvider of athlete training services

 

 

 

screen_shot_2019-01-28_at_12.39.58_pm.pngProvider of patient engagement solutions

 

 

 

screen_shot_2019-01-28_at_12.40.26_pm.pngProvider of cost containment solutions for healthcare payers

 

 

 

screen_shot_2019-01-28_at_12.41.09_pm.pngProvider of online nutrition coaching and certifications for wellness professionals and consumers

 

 

 

screen_shot_2019-01-28_at_12.41.34_pm.pngProvider of revenue cycle management solutions for physicians offices

Case Study: MMIT

HW’s TMT Group advised MMIT on its acquisition by Welsh, Carson, Anderson & Stowe.

screen_shot_2019-01-28_at_12.42.20_pm.pngRelevant Healthcare IT Sub-Sectors

  • Non-Acute Care Delivery (Pharma)
  • Marketing Research & Analytics (Pharma) 
  • Revenue Cycle Management (Payer)

Company Overview

MMIT is a leading provider of SaaS-based pharmaceutical data and analytics solutions for market access to pharmaceutical manufacturers, payers, and prescribers. Through a comprehensive data set built through years of experience within multiple segments of healthcare, MMIT focuses on providing the industry source of truth for drug policy and restriction information.

Key Value Drivers 

  • Comprehensive data set built through years of experience across multiple segments of healthcare
  • Largest database of drug policy and restriction information in the market
  • Core software backbone that facilitates formulary management, digital distribution, and compliance for payers
  • Extensive blue-chip client base with over 200 logos, including 80% of the top 50 pharma manufacturers and payers managing over 100 million insured lives
  • Well-defined growth vectors to accelerate sales of specialty and oncolytic indication data

HCIT Public Market Observations1

As of December 31, 2018

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Public Comparables

Valuation and Operating Metrics1

As of December 31, 2018 ($ in millions)

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Select Healthcare IT M&A Transactions1

screen_shot_2019-01-28_at_12.51.41_pm.pngResMed’s Acquisition of Propeller Health

  • Propeller Health is a digital therapeutics company providing connected health solutions for individuals with chronic obstructive pulmonary disease (COPD) and asthma
  • Propeller’s solutions help to more effectively treat COPD and demonstrated a 58% improvement in medication adherence, 48% increase in symptom-free days, and 53% reduction in emergency room visits
  • An acquisition of Propeller deepens ResMed’s current suite of cloud-connected products for those with later-stage COPD, and enhances its overall device, hardware, and software footprint within respiratory

screen_shot_2019-01-28_at_12.52.41_pm.pngCVS Health’s Acquisition of Aetna

  • Aetna is a provider of healthcare benefit services, offering individuals innovative benefits, products, and services
  • With the acquisition, CVS hopes to become a destination for more than just flu shots across its 9,800 retail outlets and 1,100 MinuteClinics to Aetna’s 22 million medical members by adding additional health services focused on managing common chronic conditions, and guiding discharged patients through their at-home plans
  • An acquisition of Aetna allows CVS to continue to address healthcare spending through lower-cost medical services in pharmacies

screen_shot_2019-01-28_at_12.53.40_pm.pngVeritas Capital’s Acquisition of athenahealth

  • Athenahealth is a provider of EMR, RCM, patient engagement, care coordination, and population health services through partners with hospital and ambulatory organizations
  • Athenahealth’s solutions serve a network of more than 120,000 providers and approximately 117 million patients
  • Veritas Capital is expected to combine athenahealth with Virence Health, formerly GE Centricity, to establish a leading software vendor for the sub-acute care market

screen_shot_2019-01-28_at_12.55.05_pm.pngResMed’s Acquisition of MatrixCare

  • MatrixCare is a leading provider of clinical and administrative software for long-term, post-acute care providers
  • MatrixCare’s solutions serve more than 15,000 providers across skilled nursing, life plan communities, senior living, and private duty
  • ResMed’s acquisition of MatrixCare further expands its out-of-hospital SaaS portfolio into the under-served long-term care setting market

screen_shot_2019-01-28_at_12.56.31_pm.pngTriMedx’s Acquisition of Aramark Healthcare Technologies

  • Aramark Healthcare Technologies (Aramark HCT) is a provider of healthcare technology services ranging from repair and maintenance to outsourcing of clinical engineering services
  • Aramark’s solutions are utilized by over 500 healthcare providers nationwide
  • An acquisition of Aramark HCIT allows TriMedx to deliver its technology-driven solutions to a broader set of healthcare provider customers, driving clinical and financial results

What We’re Reading

Population Health Platforms Evolve With AI and Machine Learning for Value-Based Care

Healthcare IT News   December 13, 2018

With increasing competition in value-based payment models, platforms are required to provide more customized PHM programs. Providers are increasingly focused on ROI from PHM solutions, which has resulted in a more holistic and evidence-based approach covering high-risk and at-risk patients with more preventative care solutions. In order to best allocate resources, PHM vendors are more heavily relying on machine learning, the use of predictive disease modeling, and automated risk stratification techniques

Read the full article here.

Financial Barriers Still Get in the Way of Telemedicine Adoption

Modern Healthcare   December 3, 2018

Small physician-owned practices have been slow to adopt virtual care due to financial barriers, with only 8.2% of these practices using telemedicine for patient interactions, compared to the 26.5% usage by large practices. There is also a large variance of adoption among specialties, with almost 40% of radiology using telemedicine for patient interaction, and only 6% of internal medicine providers with allergy or immunology specials adopting the platform. Albeit a slower adoption, telemedicine is proven to be on the rise with telemedicine visits among large practices growing over 260% annually from 2015 to 2017.

Read the full article here.

The Quest for Identified Data: Why Some Firms are Bypassing Hospitals

Fierce Healthcare   November 14, 2018

There is potential for a large paradigm shift in data collection, as data brokers have recently begun moving outside of the traditional healthcare system and offering to pay patients directly for their data. For patients, while this can offer appeal if one is sick or under tight budget constraints, it can also introduce risk as the data moves outside of the patient-provider relationship and is not covered by HIPAA. This potential access to data also provides huge potential upside for pharmaceutical manufacturers in specialty drug development, as they often need genomic data that is not otherwise given by providers.

Read the full article here.

Why Doctors Hate Their Computers

The New Yorker   November 12, 2018

Further digitization within healthcare is expected to make medical care easier and more efficient for both patients and doctors. However, issues arise as the potential disconnect between patients and providers could be created through lack of face-time as a result of increased screen-time. Additionally, the increased time in training for doctors to get up to speed with the new platform may create additional inefficiencies. Patients, however, are able to better access their own medical information, creating increased transparency across both individuals and families.

Read the full article here.

Meet the Newest HIMSS Analytics Adoption Mondel: INFRAM

Healthcare IT News   October 25, 2018

After a wealth of hacking incidents over the past several years, companies have updated their IT systems and security across the organization. The Infrastructure Adoption Model (INFRAM) helps hospitals and health systems benchmark how their IT systems stack up with mobility, security, collaboration, transport, and data warehousing. This new system assists healthcare organization in securely implementing the infrastructure in which its EMRs are built upon, while leveraging its technologies for both clinical and operational efficiencies.

Read the full article here.

M&A Transaction Activity

Select Recent M&A Transactions

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Private Placement Transaction Activity

Select Recent Private Placement Transactions

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Patient-Facing Tools - Landscape

Representative Provider, Payer, and Consumer Tools 

To view full market map please contact: *TMT_HCIT@harriswilliams.com

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Select HW TMT Transactions

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1. FactSet

2. PitchBook

 

 

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