PurpleLab pivots, raising $40M for health data

Real-world health data company PurpleLab raised $40 million in a Series B funding round, roughly six months after Axios wrote that it was exploring a sale.

Why it matters: The Wayne, Pennsylvania-based company collects, streamlines and stores clinical and claims data — information that big players including pharmaceutical companies and providers rely upon for drug and clinical research.

Driving the news: Randomized clinical trials are considered the gold standard source of information for drug development, but recent FDA guidance encourages pharma companies to use real-world evidence in addition to RCT data.

Deal details: Primus Capital led the round and insider Edison Partners joined, bringing PurpleLab's total funding to roughly $43 million, per Pitchbook.

• TripleTree advised PurpleLab, a news release said, consistent with Axios' prior report.

Flashback: PurpleLab in April was fielding significant inbound interest, sources told Axios then.

• At the time, the company was marketing a forward ARR of around $35 million, sources said, and estimated GAAP revenue for 2022 was in the $20 million range (more than double the $10 million generated in 2021), they said.

How it works: PurpleLab collects, cleans up and stores clinical and claims data that is ultimately used by different health care stakeholders for various purposes.

State of play: Sponsors and strategics are willing to pay up for health data, and startups focused on the space have attracted significant venture interest.

• Thomas H. Lee Partners spent more than $1.5 billion for data insights company Intelligent Medical Objects in March, implying a multiple of more than 25x, Sarah reported.
• Contract research organization ClinChoice in July raised $150 million in Series E funding.
• Medical data sharing startup PicnicHealth in June collected $60 million in Series C funding.

💭 Our thought bubble: Given what we know, the process pivot likely comes down to valuation as these things usually do.