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Tempus AI, which provides data and analytics tools for precision medicine, filed for an IPO on Monday night.

Why it matters: A successful listing for Tempus — long considered an IPO candidate — could breathe life into a tepid public market for health care, Aaron writes. 

Zoom in: Chicago-based Tempus AI has not yet disclosed the offering price. The company purports to create "intelligent diagnostics" for precision medicine.

The offering is being led by Morgan Stanley, JPMorgan Chase and Allen & Co. Tempus AI plans to list on Nasdaq under the symbol TEM.

By the numbers: The company had a net loss of $266 million on revenue of $532 million in 2023, compared with a net loss of $334 million on revenue of $321 million in 2022, per the filing.

Tempus generated $562 million in revenue for the 12 months ending March 31, 2024.

Catch up quick: Tempus AI was reportedly exploring an IPO in late 2021, at which point the company was valued at around $8.1 billion.

Founded in 2015, the company has raised $1.42 billion to date, per PitchBook, from investors including Baillie Gifford, Google, Franklin Templeton, Novo Holdings and funds managed by T. Rowe Price Group. Earlier investors include Revolution Growth and NEA.

Among Tempus AI's largest investors is founder and CEO Eric Lefkofsky, also founder of Groupon.

How it works: Tempus AI claims to have the largest library of clinical and molecular data, which it uses in partnership with providers to improve patient care.

The company provides genetic sequencing services, working with providers like Cedars-Sinai Cancer to develop personalized treatments by replicating patients' DNA, RNA and protein.

Tempus AI also boasts a swath of predictive, algorithm-based diagnostics for biomarkers in oncology and neuropsychology. The company has strategic relationships with large pharmaceutical companies like Pfizer and AstraZeneca.

💭 Aaron's thought bubble: When Tempus AI was weighing an IPO in 2021, AI use cases in health care were more opaque. The company is likely to benefit significantly from the learnings gleaned over the last three years.

1 big thing: Tempus AI files for IPO

Illustration of a robot arm holding a bag of money. 

End-of-life care company Tuesday Health raised $60 million, led by Welsh Carson-owned Valtruis, CEO Jim Wieland tells Erin exclusively.

Why it's the BFD: Hospice remains a blind spot for Medicare Advantage as the only Medicare service that over half of enrollees can't currently access.

Zoom in: Blue Venture Fund, Mass General Brigham Ventures and CareSource participated in the unlabeled round.

Funds will fuel hiring and help the company open in its first market this July in Ohio.

Wieland, who says the capital puts Tuesday "well into next year," does not foresee raising again "anytime soon."

The big picture: "American health care, from medical education all the way through to the payment system, generally does not encourage doctors to listen to dying patients' needs or priorities," former Axios reporter Bob Herman wrote.

How it works: Formed by Valtruis, Chicago-based Tuesday works with Medicare and Medicare Advantage, accountable care organizations (ACOs) and subspecialty providers such as nephrology and oncology groups.

The company then identifies plan members likely to die in the next 18–24 months who face serious obstacles to daily living — often people who frequently visit the emergency room, for example.

Tuesday offers these patients and their families palliative care services such as hospice referrals, virtual nursing support and prescription management.

The company employs a virtual nursing team of advanced practice providers monitored by a registered nurse.

Flashback: Private equity firm Welsh, Carson, Anderson & Stowe (WCAS) created Valtruis with $300 million in 2021 to power a series of value-based health care entities like Tuesday, which it founded in 2023.

Inside the room: Tuesday's strategic partnerships with Ohio-based CareSource and Ohio's Hospice, a not-for-profit organization that covers a large portion of the state, led the company to launch its first program in the Buckeye State, per Tuesday Health head of clinical delivery Mihir Kamdar.

By the numbers: Hospice care is an estimated $34.5 billion market expected to reach $64.7 billion by 2030, per Grand View Research.

Private equity has poured dollars into hospices, with 30% to 50% of all home health and hospice transactions in 2021 involving PE firms, according to M&A advisory firm The Braff Group.

That figure is on the rise, per a 2021 analysis that found that the number of hospice agencies owned by PE groups rose from 106 (of 3,162) in 2011 to 409 (of 5,615). About three-quarters of PE-acquired hospices were nonprofits.

Between the lines: A 2022 report from watchdog group Private Equity Stakeholder Project suggested that for-profit hospice agencies have been tied to lower standards of care, fewer patient visits, higher rates of hospitalization and poorer worker compensation than their nonprofit counterparts.

What they're saying: "There's really no benefit to pre-hospice care right now, which is why you have sort of this cliff experience for patients and families," says Valtruis managing partner Anna Haghgooie.

"It's also a cliff for providers who don't get to work with patients and families to create the right structure around engagement and delivery as an on-ramp to hospice," Haghgooie adds.

"Our goal is to create a reimbursement model that allows for high-quality care," she says.

State of play: The palliative and end-of-life care sector is dominated by a few legacy players such as Elevance and Walgreens, but startups have been dipping toes into the space.

Elevance (formerly known as Anthem) in 2022 acquired the nation's largest non-hospice community-based palliative care provider, Aspire Health.

CareCentrix, purchased in 2022 by Walgreens, in 2020 acquired palliative care company Turn-Key Health.

Hospice care startup Guaranteed in 2022 raised a $6.5 million seed.

Betterleave, an employer-facing bereavement support startup, last fall closed a $2.4 million seed.

What's next: "In the event that hospice gets carved into Medicare Advantage, we want to be ready," says Wieland.

2. The BFD: Tuesday nets $60M for end-of-life care

Illustration of a collage of hands holding and a bouquet of flowers behind a curtain. 

Want more health tech deals? Check out the Axios Pro Deals Tracker.

• Labgenius, a British machine learning-powered drug discovery company focused on novel therapeutic antibodies, raised a £35m Series B led by new backer M Ventures with participation from Octopus Ventures and LG Corp and insiders Atomico, Kindred Capital, Lux Capital and Obvious Ventures. axios.link/4aory9u

• SamaCare, a Silicon Valley provider of prior authorization software for specialty medications, raised a $17m Series B led by Questa Capital and joined by insiders Vive Collective and South Park Commons. samacare.com

• Videra Health, an Orem, Utah-based AI-driven maker of a mental health assessment, raised a $5.6m seed led by Peterson Ventures and joined by Mercato Partners, Epic Ventures and Philo Ventures. axios.link/3WTIDVF

• Superpower, a California personal health optimization startup, raised a $4m seed from Susa Ventures and Long Journey Ventures. superpower.com

• Nanopath, a Boston diagnostics startup focused on women's health, got a $3m grant from the NIH and a $1m grant from the NSF. nanopathdx.com

• InTandem Capital Partners made a majority investment in Adams Clinical, a Watertown, Mass.-based site network for central nervous system research. axios.link/44UXoth

• KKR acquired a minority stake in Infinx, an Indian maker of revenue cycle management software for health care. axios.link/4bpxX5L

• Eir Partners, a Miami-based health tech-focused PE firm, closed its second fund with $496m. eirpartners.com

3. Deals o' the day

• Geyer Jones, former COO of Cylera, joined Blackwell Security as the company's first CEO. axios.link/3yCunq7

• At AccessHope, Brad Kreick, former SolutionHealth CEO, was appointed CEO. Debby Morris, former CEO of DLM Advisory, joined as COO and CFO. axios.link/3USYcKR 

• Susan Ray, former chief operating officer at Honest Medical Group, joined Rippl Care as COO. axios.link/3K7Scsm

• Ian Harris, former partner at Hudson Executive Capital, joined Talkspace as CFO, replacing Jennifer Fulk, who is stepping down. axios.link/3V60OpW

• Kristen Vener, former VP of consultant relations at Sharecare, joined Form as VP of consultant relations. Also at Form, Brian Walker, former VP of sales at Hello Heart, joined as as VP of sales. formhealth.co

• Mani Venkatesh was promoted from VP of engineering to VP of digital transformation at Terumo Blood and Cell Technologies. terumobct.com

4. It's Personnel

🏥 Surging hospital prices are helping keep inflation high — WSJ

💉 Could ketamine be a fix for workplace depression? — FT

👨‍⚕️ How doctors pressure sickle cell patients into sterilizations — Stat

🎲 Oracle's deadly gamble — Business Insider

5. Your daily dose

illustration of a digital thermometer that reads "daily dose" 

It's Tuesday (afternoon), Health Tech readers, and we hope you'll spend it "chasing the clouds away," as the Moody Blues intended.

❤️‍🩹 Situational awareness: We are deeply saddened to hear of the passing of Marshall Allen, prolific health care reporter and author (and Erin's journalism school mentor and capstone adviser). 

🦮 Aaron is sad that Benny is gone and moving to LA but still has Logan the GSD to take care of for another week!

📗 Thanks for reading, and extra thanks to newsletter editor Claire Rychlewski and copy editor Egan Millard. Please ask your colleagues, friends and family to sign up.

May 21, 2024

1 big thing: Tempus AI files for IPO