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Marathon and Everside merge to create worksite primary care giant

Illustration of “Hello, My name is” sticker in the shape of a health plus

Illustration: Eniola Odetunde/Axios

Employer primary care providers Marathon Health and Everside Health announced plans to merge.

Why it matters: U.S. companies are spending big on employees' health care, often with little insight into whether they're paying for quality care.

Details: The combined company — which will operate as Marathon Health — expects to generate "well over $500 million" in revenue this year, Marathon CEO Jeff Wells tells Axios.

  • Wells, who will lead the business moving forward, described the transaction as a merger-of-equals and said talks between the two started last spring. Financial terms were not disclosed.
  • Everside CEO Chris Miller will depart for other opportunities but remains a shareholder.
  • Marathon backer General Atlantic and Everside backers New Enterprise Associates and Oak HC/FT remain invested in the entity.

How it works: Marathon and Everside provide employers onsite, network and virtual primary care clinics and services.

  • Alongside primary care, the companies offer occupational health, behavioral health and care navigation.

The big picture: Marathon and Everside's value proposition is in potential savings for employers, which are currently staring down the largest annual increase in health care costs in a decade.

  • "The awareness of primary care as the solution — and the right type of primary care — has actually never been stronger," Wells says.

What's next: Integration of the merger is top-of-mind near-term, with no additional M&A planned now, Wells says.

Yes, but: "One thing we've recognized is employers increasingly have point solution fatigue," he adds, noting Marathon could seek acquisitions that focus on integrating multiple HCIT solutions.

State of play: Marathon competes with Premise Health — which OMERS acquired for $1.1 billion in 2018 from Water Street Healthcare — as well as Select Medical-owned Concentra Health.

  • Meanwhile, strategics like Amazon and CVS have increased their primary care footholds.

Catch up quick: General Atlantic acquired a majority stake in Marathon in 2019 for an undisclosed price.

  • Everside, formerly Paladina Health, was sold to NEA by dialysis business DaVita for $100 million in 2018. NEA led a $165 million raise for the company that year.
  • Both companies have completed a spate of acquisitions of smaller-scale competitors in subsequent years.

What we're watching: Everside had plans to go public in 2021 before scrapping an IPO due to market conditions.

What they're saying: "We don't have a defined path to access the public markets versus other paths to access capital," Wells tells Axios.

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