Healthcare IT Insights
First Analysis Investment Banking June 2012
Chicago, IL 60
One South Wacker • Suite 3900 • Chicago, IL 60606
312-258-1400 • www.firstanalysis.com
Industry Focus: ICD-10 Compliance Date Slips, but Demand for Solutions Persists On April 9, the Department of Health and Human Services (HHS) announced a proposed rule that would delay the compliance date of ICD-10 to October 1, 2014. The new proposed deadline is the second official delay of ICD-10. Recall that in 2008, a proposed rule stated the ICD-10 compliance date would be October 1, 2011 and then in January, 2009, HHS issued a final rule that pushed the date back to October 1, 2013. Earlier this year, HHS had indicated that the 2013 deadline would be extended but offered no specifics at that time.
Some provider groups had expressed serious concerns about their ability to meet the October 1, 2013 compliance date. CMS and HHS believe the change in the compliance date for ICD-10 would give providers and other covered entities more time to prepare and fully test their systems to ensure a smooth and coordinated transition among all industry segments.
The proposed rule cites three issues that led CMS to consider extending the compliance date: (i) a difficult transition to Version 5010; (ii) limited resources for providers constrained by other statutory initiatives such as the EHR Incentive Program; and (iii) a lack of readiness for the transition as indicated by industry surveys.
As observed in a First Analysis research note published at the time of the HHS announcement, research analyst Frank Sparacino viewed a one year ICD-10 delay as “unlikely to have a major short-term negative impact on vendors as large providers continue to move forward.”
This most recent delay of ICD-10 compliance emboldens those who argue that ICD-10 should be permanently scrapped and that it would be less time-consuming and more cost-efficient to jump from ICD-9 to ICD-11, which is planned for 2015. However, some industry observers note that the nation should not expect to move to ICD-11 until well after 2020 given the required planning and inevitable delays that would accompany that transition. As a result, companies that address training and technology solutions to ICD-10 challenges should see appreciable growth heading through 2014.
Impact for Computer Assisted Coding (CAC) Vendors
With the change to ICD-10, there is a general consensus that coding and documentation will drive reimbursement to where accuracy in coding and documentation becomes inevitable. The increased complexity associated with ICD-10 will dramatically increase the ROI that healthcare providers can derive from CAC solutions. CAC has already demonstrated significant adoption as a result of advances in natural language processing and informatics, adoption of EHRs, compliance issues, and a mandate for reducing labor-intensive administrative reporting processes. Compliance with ICD-10 will make these automated tools for coding even more valuable, especially with improved functionality. While hospital officials anticipate a loss of productivity when they move to the more complex diagnostic coding system, many also hope that CAC applications will be needed to alleviate that productivity drop. Ultimately, a delay in the deadline for ICD-10 compliance may impact the timing of outlays for CAC solutions by some providers, but total investment in CAC will remain strong.
October 1201134
ICD-10 Compliance
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Page 2 of 12
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Healthcare IT Insights June 2012
Page 3 of 12
Industry Stock Market Performance Over the past five years, the First Analysis HCIT Index outperformed the broader market indices. The HCIT index increased 95.3% compared to an increase of 8.6% for the NASDAQ and a decrease of 14.4% for the S&P 500 over the same period. Over the nearer term (one year) the HCIT index slightly outperformed the broader indices, increasing 1.2% compared to a decrease of 0.3% for the NASDAQ and a decrease of 2.6% for the S&P 500.
5 Year Indexed Performance (05/31/2007 to 05/31/2012)
1 Year Indexed Performance (05/31/2011 to 05/31/2012)
Source: Capital IQ.
First Analysis HCIT Index includes: AH, ABCO, ATHN, CERN, CPSI, EPOC, HMSY, HSTM, MDAS, MDRX, MDSO, MEDW, MRGE, NRCI and QSII.
Public Market Trading Multiples As of May 31, 2012, median public market valuations for companies within the First Analysis HCIT Index was 2.95x consensus 2012 revenue estimates and 10.9x consensus 2012 EBITDA estimates.
First Analysis HCIT Index Trading Multiples
Enterprise Value / 2012E Revenue
Enterprise Value / 2012E EBITDA
Source: Capital IQ. Data as of May 31, 2012.
(60%)
(30%)
0%
30%
60%
90%
120%
150%
May-07 May-08 May-09 May-10 May-11 May-12
HCIT Index
S&P 500
NASDAQ
(20%)
(10%)
0%
10%
20%
May-11 Aug-11 Nov-11 Feb-12 May-12
HCIT Index
S&P 500
NASDAQ
5.69x 4.96x 4.70x 4.52x
3.65x 3.38x 3.12x 2.86x 2.67x 2.64x
1.63x 1.39x 1.17x 0.91x 0.91x
ATHN
32.5%
HMSY
39.3%
CERN
21.1%
HSTM
23.3%
ABCO
21.5%
NRCI
14.4%
QSII
17.3%
CPSI
12.3%
MDSO
16.6%
MDAS
5.3%
MRGE
9.8%
MDRX
4.8%
MEDW
11.9%
AH
17.8%
EPOC
(3.6%)
28.9x
15.3x 15.1x
21.8x 19.3x
10.9x 10.5x 11.3x 11.3x 8.3x 8.8x
6.2x 4.4x
10.9x 9.6x
ATHN
20.1%
HMSY
32.8%
CERN
31.8%
HSTM
21.1%
ABCO
19.4%
NRCI
31.5%
QSII
30.2%
CPSI
26.2%
MDSO
24.8%
MDAS
32.5%
MRGE
19.0%
MDRX
23.0%
MEDW
25.9%
AH
9.0%
EPOC
10.0%
Median Metrics
EV / EBITDA: 10.9x
EBITDA Margin: 24.8%
Median Metrics
EV / Revenue: 2.95x
Revenue Growth: 16.6%
2012E EBITDAMargin
2012E RevenueGrowth Rate
8.6%
(14.4%)
95.3%
(2.6%)(0.3%)1.2%
Healthcare IT Insights June 2012
Page 4 of 12
The current HCIT median forward EBITDA multiple of 10.9x as of May 31, 2012 is below its five year average forward median multiple of 13.4x and is also below its one year average forward median multiple of 14.7x.
First Analysis HCIT Index 5 Year Historical Median Forward EBITDA Multiples
First Analysis HCIT Index 1 Year Historical Median Forward EBITDA Multiples
Source: Capital IQ. Note that forward estimates may not be available for all companies within the index for all periods.
First Analysis HCIT Index includes: AH, ABCO, ATHN, CERN, CPSI, EPOC, HMSY, HSTM, MDAS, MDRX, MDSO, MEDW, MRGE, NRCI and QSII.
Recent Industry Merger & Acquisition Activity M&A activity across the HCIT sector remains robust with both strategic and financial buyers actively seeking acquisitions. Select strategic buyers continue to acquire targets that enhance their overall suite of solutions as they try to develop a more fulsome product suite, address meaningful use requirements, and capitalize on structural changes throughout the healthcare industry that are driving demand for technology-enabled solutions that increase efficiency and improve care. For financial buyers, transformations underway throughout the healthcare sector provide a backdrop for investment theses around delivering technology solutions to facilitate change.
Select Industry M&A Transactions (Announced from 01/01/12 to 05/31/12)
Date Anncd.
Status Target Buyer Target Business Description Transaction
Value ($ millions)
06/04/12 Closed Integrated Physician
Systems Inc SuccessEHS, Inc.
Offers revenue cycle management, business services and strategic advisory and consulting services to healthcare entities
N/A
05/22/12 Closed Patient Edu, LLC ExitCare, LLC Develops and markets patient education software programs and educational content for healthcare providers
N/A
05/16/12 Closed The Poseidon
Group, Inc. NextGen Healthcare Information Systems
Provides documentation and Web-based EDIS solutions to the healthcare industry
$2.5
05/15/12 Closed Medify, Inc. Alliance Health Network, Inc.
Provides medical research and treatment information online N/A
05/15/12 Closed PriceDoc, Inc. Health In Reach,
Inc. Provides an online marketplace connecting healthcare providers with consumers looking for medical and dental procedures
N/A
05/15/12 Closed Vendor
Credentialing Service LLC
The CapStreet Group, LLC
A Web based vendor credentialing, vendor compliance and vendor access program to hospitals
N/A
05/15/12 Closed National Healthcare Exchange Services
Inc. Gateway EDI, Inc.
Operates a healthcare exchange, which provides initiated discounts for all commercial lines of business in healthcare
N/A
(continued next page)
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
16.0x
18.0x
20.0x
May-07 May-08 May-09 May-10 May-11 May-120.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
16.0x
18.0x
20.0x
May-11 Aug-11 Nov-11 Feb-12 May-12
Average = 13.4x
Average = 14.7x
Healthcare IT Insights June 2012
Page 5 of 12
Select Industry M&A Transactions (continued) (Announced from 01/01/12 to 05/31/12)
Date Anncd.
Status Target Buyer Target Business Description Transaction
Value ($ millions)
05/14/12 Closed Source Healthcare
Analytics, LLC ImpactRx, Inc.
Provides information, analytics and consulting services by collecting and analyzing information regarding medicines and other aspects of healthcare
N/A
05/10/12 Announced MedSeek Inc. Essex Woodlands Health Ventures;
Silver Lake Partners
Provides patient, physician, and employee portals for healthcare organizations to engage relationships with physicians, patients, employees, and consumers
N/A
05/10/12 Closed Gleric Holdings, LLC Spine Pain
Management, Inc.
Develops halo system technology for documenting case treatments and facts during medical procedures through an Internet protocol video enhanced platform
$0.2
05/10/12 Closed Accumed Script Inc. iMedX, Inc. Medical transcription services utilizing the internet-hosted iScribe Platform for outsourced transcription
N/A
05/07/12 Closed TC³ Health, Inc. Emdeon Inc. Provides claims management solutions to health care payers and integrates internal claim management systems with external loss control programs
N/A
05/04/12 Closed Marathon
Multimedia, LLC Coe-Truman
Technologies, Inc.
Provides content management solutions for medical societies and associations, pharmaceutical companies, other healthcare professionals, and journal publishers
N/A
04/27/12 Closed KLO Professional
Billing, Inc. PracticeMax, Inc. Offers revenue cycle management services N/A
04/25/12 Closed Matrix Management
Solutions LLC Quality Systems Inc.
Provides various healthcare and revenue cycle management solutions, including training, design, implementation, and support for revenue cycle management solutions
$16.3
04/24/12 Closed DecisionView, Inc. IMS Health
Incorporated Develops Web-based clinical optimization solutions for the life sciences industry
N/A
04/24/12 Closed Smart Solutions for Health Care, Inc.
WeiserMazars LLP Health care consulting company that provides information technology (IT), IT outsourcing, and revenue cycle improvement services
N/A
04/23/12 Closed Ascentia Health
Care Solutions, LLC Healthways Inc.
Develops programs to support and promote population health management, patient centered programs, payer strategies and provider enhancement programs
N/A
04/23/12 Closed Thomson Reuters (Healthcare) Inc.
Veritas Capital Provides data, analytics and performance benchmarking solutions and services to the healthcare industry
$1,250.0
04/19/12 Closed BlueLibris, LLC Numera, Inc. Offers mobile health and safety monitoring with Libri, a personal heath gateway that is connected over the mobile network to a cloud-based architecture
N/A
04/17/12 Closed Pinsonault
Associates, LLC Decision Resources
Group Provides managed markets business and training solutions for pharmaceutical and biotech manufacturers
N/A
04/10/12 Closed CodeRyte, Inc. 3M Co. Provides natural language processing and computer-assisted coding technologies to the health care industry
N/A
(continued next page)
Healthcare IT Insights June 2012
Page 6 of 12
Select Industry M&A Transactions (continued) (Announced from 01/01/12 to 05/31/12)
Date Anncd.
Status Target Buyer Target Business Description Transaction
Value ($ millions)
04/03/12 Announced Health Information Kiosks of Merge
Healthcare Solutions Higi LLC
The Health Information Kiosks of Merge Healthcare provide point-of-use health information to customers including vitals, weight and blood pressure
$2.8
04/02/12 Closed GlobalNet Solutions,
Inc.
Medical Transcription Billing,
Corp.
Develops and provides electronic health practice and revenue cycle management solutions
N/A
03/29/12 Announced ClearTrial, LLC Oracle Corporation Provides SaaS-based Clinical Trial Operations software for planning, forecasting, and tracking clinical project and financial performance
N/A
03/22/12 Closed Talon IP
Communications, Inc.
Knowledge Anywhere, Inc.
Develops software applications, including an e-health solution that allows physicians to provide health education and clinical information to patients through email and over the Web
N/A
03/22/12 Closed LaBelle Strategic Resources, Inc.
Knowledge Anywhere, Inc.
Provides IT and services to healthcare organizations, including project management, implementation, training, support and help desk, staff augmentation and permanent placements
N/A
03/20/12 Closed Artemetrx LLC Pharmaceutical
Strategies Group, LLC
A healthcare analytics and solutions company that develops and implements blueprints for healthy cost savings
N/A
03/19/12 Closed MD Technologies
Inc. MD On-Line, Inc.
Provides SaaS and healthcare revenue cycle management and solutions to physicians and other healthcare providers
N/A
03/13/12 Closed 4G Biometrics, LLC ActiveCare, Inc. Offers real-time information regarding the current glycemic index status of enrolled diabetics and telemedicine intervention, which includes physician contact and lifestyle coaching
$0.5
03/12/12 Closed STAT Technologies,
Inc.
Passport Health Communications,
Inc.
Develops and delivers HCIT solutions, including enterprise outpatient scheduling solutions, a surgery information system; enterprise inpatient flow management, and physician portal
N/A
03/12/12 Closed RealAge, Inc. Sharecare, Inc. Provides personalized health information and health management tools N/A
03/07/12 Closed Transcend Services,
Inc.
Nuance Communications,
Inc.
Provides transcription and clinical documentation services to the healthcare industry
$331.6
03/06/12 Closed WellApps, Inc. Medivo Inc. Develops and distributes symptom tracking applications for patients with chronic illnesses
N/A
03/06/12 Closed Phacts, LLC CareFusion Corporation
Provides HCIT services, including software and equipment to create, print and apply barcodes to non-oral solid medications and an inventory management and workflow administration software
N/A
03/05/12 Closed Medical
Transcription Assets of Inner Office
iMedX, Inc. Provides medical transcription services N/A
02/29/12 Closed OptiMed, Inc. MediGain, Inc. Provides revenue cycle management, business consulting and software hosting solutions for physicians and hospitals
N/A
(continued next page)
Healthcare IT Insights June 2012
Page 7 of 12
Select Industry M&A Transactions (continued) (Announced from 01/01/12 to 05/31/12)
Date Anncd.
Status Target Buyer Target Business Description Transaction
Value ($ millions)
02/29/12 Closed DermSEO.com TastyPlacement Inc. Provides search engine optimization (SEO) and Web design services for dermatologists
N/A
02/28/12 Closed eScreen, Inc. Alere Inc. A technology-enabled TPA that provides Web-based employment screening applications for hiring and maintaining workforces
$340.0
02/28/12 Closed BOSTON LIFE
LABs, LLC NantWorks LLC
Offers telehealth systems, including a hub that transmits data from patient to clinician, caregiver, and/or family member via GSM/GPRS and/or WiFi
N/A
02/28/12 Closed Clinical Coding Solutions, Inc.
T-System, Inc. Provides medical charge management and auditing services to hospital emergency departments
N/A
02/24/12 Effective Intuitive Medical
Software, LLC and meridianEMR, Inc.
HealthTronics, Inc. Provide urology specific electronic medical record software (EMR) and solutions
N/A
02/23/12 Closed PatientWorks SalePoint, Inc. Sells, markets and services an enterprise document automation software solution for the healthcare market
N/A
02/23/12 Closed SweetSpot Diabetes
Care, Inc. DexCom, Inc.
Provides a range of diabetes technology services that enable endocrinology clinics to download patients’ device data and generate reports
$9.8
02/21/12 Closed PatientPoint, Inc. Healthy Advice Networks, LLC
fka Greatwater Software, develops and deploys self-service applications for the healthcare industry
N/A
02/16/12 Closed Intego Systems Inc. Critical Alert
Systems, LLC fka Intego Systems, develops and manufactures nurse call systems and integrated software products for hospitals
N/A
02/14/12 Closed NaviNet, Inc. Three Blues plans and Lumeris, Inc.
fka NaviMedix, provides healthcare communications network solutions N/A
02/09/12 Closed Parses Inc. Sunera LLC Provides E/M audits solutions for healthcare customers, including an online solution that audits medical records to assess the correctness of physician billing and payment
N/A
02/09/12 Effective Benchmark Revenue
Management, Inc. Avadyne Health
Provides Web-based single platform revenue cycle workflow and reporting solutions for hospitals
N/A
02/08/12 Closed Concerro,
Incorporated API Healthcare
Corporation SaaS company providing healthcare workforce and emergency response and incident management systems for hospitals
N/A
02/08/12 Closed peerVue, Inc. McKesson
Corporation Provides workflow and communication solutions for the healthcare industry
N/A
02/08/12 Closed SeniorMetrix Inc. Navihealth, Inc. Provides predictive modeling, analytical, benchmarking and case management services to health plans
N/A
02/07/12 Closed Trilogi, Inc. Recondo
Technology, Inc. Provides revenue cycle management and recovery services for the health care industry
N/A
02/02/12 Closed CDS Oncology
Assets of Proventys
McKesson Corporation
The assets consist of a web based clinical decision support system for cancer patients which offers a guide for diagnostic and therapeutic decisions
N/A
(continued next page)
Healthcare IT Insights June 2012
Page 8 of 12
Select Industry M&A Transactions (continued) (Announced from 01/01/12 to 05/31/12)
Date Anncd.
Status Target Buyer Target Business Description Transaction
Value ($ millions)
01/31/12 Closed PhyLogic
Healthcare, LLC ADP AdvancedMD
Provides Web-based medical billing and revenue cycle management services
N/A
01/20/12 Closed OptiLink Inc. Kronos Incorporated Engages in the development and distribution of patient classification and staffing computer software used in the health care industry to measure organizational performance
$8.9
01/20/12 Closed Jbytes LLC Adaptive Software
LLC Develops web applications and customized software for the pharmacy benefits management market
N/A
01/17/12 Closed
SDI Health LLC, Health Promotional and Medical Audit
Units
Campbell Alliance Group, Inc.
Promotional and medical audit businesses of SDI Health, which IMS committed to divest in connection with its acquisition of SDI
N/A
01/12/12 Announced Kocsis Consulting
Group, Inc. The TriZetto Group,
Inc. Services include end user training, business process improvements, and 5010 and ICD-10 preparedness
N/A
01/11/12 Closed MedDirect, Inc. MedData, Inc. A healthcare payment services management company N/A
01/09/12 Closed Evolvent
Technologies, Inc.
ManTech International Corporation
Provides HCIT services to the federal government, offering clinical information technology services and clinical business intelligence services
$40.0
01/09/12 Closed Advanced
Informatics, LLC Ascend Learning,
LLC Offers online evaluations for medical and health professional organizations
N/A
01/06/12 Closed Practice
Management Associates, LLC
T-System, Inc. Provides coding, billing, and collection services to physician groups N/A
01/05/12 Closed Medical Data Express, LLC
The TriZetto Group, Inc.
Technology consulting and solutions to the healthcare market, including an encounter management software to work with claims processing systems
N/A
01/05/12 Closed ALMSA Corporation Yardi Systems, Inc. Provides Web-based assisted living, LTC, group, and retirement community management software
N/A
01/04/12 Closed Cumberland
Consulting Group, LLC
Tailwind Capital Provides health IT consulting services for ambulatory, acute and post-acute healthcare providers
N/A
01/04/12 Closed Vigilan Incorporated RealPage, Inc. Provides SaaS assisted and senior living, assisted living programs, and care plan software
$5.0
01/04/12 Closed Transtem, LLC Mediware
Information Systems Inc.
Operates as a custom software development and professional consulting company and offers a stem cell management software solution with a patient and program management focus
$0.7
Source: Capital IQ and public announcements.
Healthcare IT Insights June 2012
Page 9 of 12
Recent Industry Private Capital Raising Activities Venture and growth capital providers continue to seek opportunities to deploy capital in the HCIT sector as industry changes create opportunities for new and disruptive technologies to achieve significant growth over the next several years. The sector continues to attract the interest of investors, and larger private companies are likely to pursue future sales and public market options, including potential IPOs.
Select Industry Private Placements (Announced from 01/01/2012 to 05/31/2012)
Date Anncd.
Offer / Close Date
Status Company Primary Feature
(Details) Target
Business Description
Amount Raised
($ millions)
05/15/12 05/15/12 Closed Simplificare, Inc. Venture Capital
(Minority Stake Investment)
Develops and offers online healthcare expense management software that enables medical bill tracking, insurance claim management, billing error detection, and expense analytics
$6.0
05/03/12 -- Announced Net.Orange, Inc.
Venture Capital (Minority Stake Investment;
Multiple Tranches; Regulation D)
Healthcare information management solutions for cardiologists, clinics, health systems, hospitals, imaging centers, and oncologists
$6.0
04/26/12 05/01/12 Closed Castlight Health,
Inc.
Venture Capital (Foreign Investment; Minority Stake Investment; Regulation
D)
Offers companies a hosted software tool that provides employees with personalized views of their medical benefits and the costs associated with medical procedures
$100.0
04/16/12 -- Announced MMRGlobal, Inc. (OTCBB:MMRF)
PIPE (Equity Line; Minority Stake
Investment; Multiple Tranches)
Provides online personal health records and electronic safe deposit box storage solutions that enable individuals to access their medical records and other documents
$15.0
04/05/12 -- Announced Health Intelligence
Company, LLC
Venture Capital (Minority Stake Investment;
Multiple Tranches; Regulation D)
dba Blue Health Intelligence, provides data-driven insights about healthcare trends and best practices
$13.1
04/03/12 -- Effective Awarepoint Corporation
Growth Capital/Private Equity(Convertible Equity;
Mezzanine; Regulation D)
Offers real-time location systems that are used by hospitals to track, monitor, and optimize the utilization and workflow of personnel, patients, and equipment
$14.0
03/15/12 05/23/12 Closed InstaMed
Communications, LLC
Growth Capital/Private Equity(Individual Investors
Participated; Minority Stake Investment; Regulation D)
Operates as a real-time clearinghouse and payment processor for the healthcare industry
$14.0
03/12/12 03/12/12 Closed Jiff, Inc. Venture Capital
(Foreign Investment; Minority Stake Investment)
Develops HIPAA-compliant social network and digital health apps platform for healthcare industry
$7.5
03/05/12 -- Effective Kinnser Software,
Inc.
Venture Capital (Minority Stake Investment;
Regulation D)
Healthcare solutions including an administration and billing solution; a platform that focuses on time tracking, order signing, and e-referrals; and a patient care management tool
$39.9
03/02/12 03/06/12 Closed Integrity On Site
LLC
Growth Capital/Private Equity(Minority Stake Investment;
Multiple Tranches; Regulation D)
dba DocuTAP, offers electronic medical record and practice management solutions for urgent care facilities
$12.0
02/23/12 02/23/12 Closed Truveris, Inc. Venture Capital
(Minority Stake Investment; Regulation D)
Provides management tools to sponsors of and payers of claims under prescription benefit plans
$10.0
02/23/12 02/23/12 Closed Halfpenny
Technologies, Inc. Growth Capital/Private Equity(Minority Stake Investment)
Provides healthcare connectivity and integration solutions for heath information exchange (HIE), clinical data exchange, and computerized physician order entry applications
$6.6
(continued next page)
Healthcare IT Insights June 2012
Page 10 of 12
Select Industry Private Placements (continued) (Announced from 01/01/2012 to 05/31/2012)
Date Anncd.
Offer / Close Date
Status Company Primary Feature
(Details) Target
Business Description
Amount Raised
($ millions)
02/12/12 -- Announced LD Healthcare Systems Corp.
Venture Capital (Convertible Debt; Mezzanine; Multiple Tranches; Regulation
D)
Distributes healthcare technology systems $5.2
02/02/12 02/02/12 Closed PerfectServe, Inc. Growth Capital/Private Equity(Minority Stake Investment)
Provides clinical communications and clinical information delivery solutions for hospitals
$10.9
01/25/12 -- Effective MedSeek Inc. Growth Capital/Private Equity(Minority Stake Investment;
Regulation D)
Provides patient, physician, and employee portals for healthcare organizations to engage relationships with physicians, patients, employees, and consumers
$5.5
01/24/12 -- Announced LiveProcess Corporation
Growth Capital/Private Equity(Minority Stake Investment;
Multiple Tranches; Regulation D)
Provides software and professional services to address ongoing compliance issues, and manage an emergency preparedness and response program for hospitals
$6.0
01/17/12 01/17/12 Closed Sharecare, Inc. Venture Capital
(Minority Stake Investment)
Provides interactive healthcare platform for consumers to ask, learn and act on the questions of health
$14.0
01/10/12 -- Effective InTouch
Technologies, Inc.
Growth Capital/Private Equity(Minority Stake Investment;
Regulation D)
dba InTouch Health, develops, manufactures, and markets remote presence technology solutions, including RP-7 and RP-7i robots that are remote presence systems
$6.0
Source: Capital IQ and public announcements.
Recent Industry Public Capital Raising Activity The U.S. IPO market picked up in the early part of 2012. More recently, the IPO market is settling into a deep freeze following Facebook's troubled initial public offering in mid-May. A number of companies postponed their IPO plans as the markets reacted poorly to the Facebook IPO, which has temporarily frozen the IPO markets.
In addition, poor jobs reports and continued concerns over the economic situation in Europe, if not globally, create an environment that makes it more challenging for companies to test the public markets.
Select Announced and Pending Industry Public Offerings (Announced or Closed from 01/01/2012 to 05/31/2012)
Initial Filing Date
Offer Date
Status Company Primary Feature (Security Type)
Company Description Amount Raised
($ millions)
05/09/12 05/10/12 Closed SXC Health
Solutions, Corp. (TSX:SXC)
Follow-on Equity Offering
(Common Stock)
Provides pharmacy benefit management (PBM) services and HCIT solutions to the healthcare benefits management industry
$471.1
08/01/11 03/27/12 Closed Vocera
Communications, Inc. (NYSE:VCRA)
IPO (Common Stock)
Provides mobile communication solutions to healthcare and non-healthcare markets
$93.6
07/15/11 02/01/12 Closed Greenway Medical Technologies, Inc.
(NYSE:GWAY)
IPO (Common Stock)
Provides integrated information technology solutions and managed business services to ambulatory healthcare providers
$66.7
Source: Capital IQ and public announcements.
Healthcare IT Insights June 2012
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Healthcare IT Insights June 2012
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Brian Friedman
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Paul Johnson
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This report has been prepared by the Investment Banking Department of First Analysis Securities Corporation and is provided for informational purposes only. This report is an overview and analysis of trends and is not intended to provide investment recommendations on any specific industry or company. Neither the information nor any opinion expressed constitutes a solicitation by us of the purchase or sale of any securities. This is not a complete analysis of every material fact regarding any company, industry, or security. The opinions expressed herein reflect our judgment at this date and are subject to change. The information has been obtained from sources we consider to be reliable, but we cannot guarantee the accuracy. Past performance and any projections herein should not be taken as an indication or guarantee of future performance. First Analysis Securities may act as financial advisor and/or underwriter for companies mentioned in this report. This report may contain information which was previously included in a First Analysis Research Report. A complete listing of all companies covered by First Analysis Equity Research and applicable research disclosures can be obtained by calling 1-312-258-1400 or writing to: First Analysis Securities Corporation, Equity Research, One South Wacker Drive, Suite 3900, Chicago, IL 60606. First Analysis Securities Corporation is a registered broker/dealer with FINRA and member SIPC.