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BFD Expert Voices - Health Tech Deals

BFD Expert Voices

ConcertoCare plays at the intersection of value-based care and in-home care, aligning the company with two popular health care trends. And that placement fueled its recent $105 million Series B funding.  

Why it matters: Despite the investor frenzy behind both trends, it's early days for both and very much TBD which models will stick. 

Wells Fargo Strategic Capital, which led the January round, believes ConcertoCare's approach gives it an edge in maximizing access to home care and navigating that uncertain future.

ConcertoCare’s model “allows it to be agnostic to who the payer is,” whether that’s MA, Medicare, a CMS value-based care program, or dual-eligibles, Julian Harris, CEO of ConcertoCare, tells Sarah. 

ConcertoCare’s three businesses engage with patients differently but focus on value-based care to older, complex patients and adults with unmet social needs in the home.  

Public companies in these sectors continue to see massive volatility. 

Between the lines: While the compression of public market multiples hasn’t fully flushed through the private markets, Robert Rein of WFSC says ConcertoCare’s breadth of offerings is appealing because it puts it in a  position to reallocate efforts and resources as needed. 

“We don’t know at this stage of the investment which of the three divisions, if not all three, will resonate most,” adds WFSC managing director Rodney Altman.

ConcertoCare Partners provides additional wrap-around at-home care services for those that have PCPs. 

In-home Primary Care Provider provides in-home primary care in-person and virtually for those without PCPs. 

ConcertoPACE (Program of All-Inclusive Care for the Elderly) is an alternative to nursing programs, providing care to individuals that wish to remain in the home. 

Catch up fast: ConcertoCare's $105 million Series B round brought its total funding to date to ~$150 million, according to Crunchbase. 

Obvious Ventures, Vast Ventures, The Schusterman Family Foundation, SteelSky Ventures, Pennington Partners, and returning investor Deerfield Management joined WFSC.

ConcertoCare simultaneously acquired Crown Health, a home-based primary care practice serving the Pacific Northwest. 

The bottom line: The home and fee-for-value are dominating the thinking behind which investors are placing their bets, but everyone is taking a slightly different approach. Only time will tell who the winners and losers are. 

1 big thing: ConcertoCare covers its home bases

MindMaze, a maker of technology and virtual-reality software for brain health, raked in $105 million to bring its total funding north of $300 million.

Why it’s the BFD: MindMaze just received its reimbursement codes in the U.S., which, combined with the capital injection and existing regulatory approvals, positions it to "supercharge" mass adoption of its SaaS-based technology, CEO Tej Tadi tells Sarah from Switzerland. 

Applying brain sensing, motion capture, mixed reality and artificial intelligence, MindMaze is looking to revolutionize how various neurological conditions are treated with technology. 

"Our belief is you need to use the whole body to train and recover," Tadi says, whether that's cognitive or motor deficits.

MindMaze already has FDA and CE cleared digital therapeutics for conditions including stroke, Parkinson’s disease, Alzheimer’s disease and dementia, with over 10 clinical trials underway across eight indications.

Details: Concord Health Partners, a health care private equity firm, led the financing, joined by Europe’s AlbaCore Capital Group and London-based Hambro Perks. 

The company, which is also backed by Leonardo DiCaprio, was valued at more than $1.5 billion in October after the Swiss company raised $125 million. 

MindMaze, with a recurring revenue model, has averaged over the last three years a 90%-plus growth rate, Tadi says. 

With the latest investment, MindMaze is partnering with the American Hospital Association, bringing access to its digital solutions to its member hospitals, health care systems and other providers.  

What they're saying: "Ten years from now you should think of us as the operating system for the future of anything to do with brain diseases," the CEO says. 

2: The BFD: $105M for brain tech

Illustration of a brain which is divided at the center and has a pixelated half

The tell was a curious look on Current Health CEO Christopher McCann's face. That was all his colleague Adam Wolfberg needed to know the meeting with Best Buy was more than a casual get-together, Wolfberg, Current's chief medical officer, tells Erin.

Why it matters: As health care moves home, tech and retail giants alike are angling for a slice of the care delivery pie.

"There’s a very natural strategy we’ve seen a number of big organizations take moving into health care, whether it’s Walmart, Dollar General, CVS or Amazon," says Wolfberg. "They’ve got this incredible footprint and they're saying, 'Let's use it to deliver care.'"

Flashback: Last fall, Best Buy acquired McCann's remote patient monitoring (RPM) company for $400 million.

Before the deal announcement, Best Buy had been piloting its health care services in the homes of ~1 million seniors, CEO Corie Barry said during an investor conference in September 2019.

The pilot involved having the Geek Squad place sensors throughout seniors’ homes to measure their sleeping and eating habits, and having Great Call, the medical device company Best Buy acquired in 2018, analyze the data.

Details: With Best Buy's customer-facing Geek Squad and its Lively-branded fall-detecting wearables, the electronics giant was already well-suited to enter the health care sector, Wolfberg tells Erin.

So when Current's McCann came along with a suite of products for high-risk hospital patients seeking to have their care delivered at home, it was a natural fit, he says.

"For [Best Buy] I think it was, 'Let’s start with low-acuity conditions and move up the spectrum into higher-acuity ones," says Wolfberg. "I think that’s the vision for Current Health: Extending that work into chronic disease, post-hospital care and to our most acute, hospital-at-home care."

Eventually, the united companies will focus on shoring up Best Buy's strengths in customer support and distribution to advance Current’s mission of enabling more home-based forms of care, Wolfberg adds.

Between the lines: Big Tech isn't the only giant external industry eyeing its role in health care.

202o and 2021 saw retail and electronics giants including Best Buy and Walmart transform existing assets — think mobile workers and foot traffic — into health care tools.

What's next: Current Health is expanding its contracts beyond those focused on remote patient monitoring (RPM) devices into hypertension management, says Wolfberg.

His research team is focused on measuring chronic care management's impact on ER visits and hospital admissions, he says.

"So less hospital-at-home and more routine care of chronic conditions," Wolfberg tells Erin. "We’re planning to move down the spectrum into low-acuity deployments."

3. The Geek Squad, but make it for home care

Illustration of an ethernet cable going into a plus sign-shaped wall outlet cover.

Nina Capital, a health tech VC firm, raised more than €40m for its second fund. www.nina.capital

Dutch, a virtual veterinarian care platform, raised a $20m Series A funding. Forerunner Ventures and Eclipse Ventures led the round. http://axios.link/T17S  

Climedo, a German-based digital offering for decentralized clinical trials, closed a €5m (~$5.7m) seed financing round. Nauta Capital led the round, joined by Westtech Ventures and existing business angels. https://climedo.de/en/

SimpleHealth, a birth control-focused startup, acquired Emme, a women's health-focused health tech company focused on medication adherence. https://emme.com/

Vector Health Labs, a lab-focused tech platform, acquired telemedicine business Tulip Health. https://tuliphealth.ca/

National Medical Billing Services, an ASC-focused revenue cycle management business, acquired National Billing Partners, a surgical market RCM company. National Medical is backed by Aquiline Capital Partners. http://www.mybillingpartner.com/

Bregal Sagemount invested in DentalXChange, an Irvine, Calif.-based provider of EDI tech for the dental market. www.dentalxchange.com

PennantPark sold Pivot Health Solutions, a  physical therapy, occupational health, and onsite corporate health provider, to Athletico, a portfolio company of BDT Capital Partners. 

By the numbers: Sources told Axios in January that the pending sale commanded an approximately $550m valuation.

PennantPark took the keys of the business from its previous PE owners less than three years ago, injecting $25 million in the Pivot as part of its recapitalization.

5. Deals o' the day

Upstream Rehabilitation hired Lisa Dombro as chief of strategic growth.

London-based AlbionVC hired Molly Gilmartin, the former chief commercial officer of Induction Healthcare Group. 

6. It's Personnel

Situational awareness: Teladoc Health announced the launch of Chronic Care Complete, a management program for individuals.

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February 17, 2022

1 big thing: ConcertoCare covers its home bases