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BFD Expert Voices - Health Tech Deals

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The Biden administration is overhauling its health IT bureaucracy to address the proliferation of cyberattacks on the sector and the growth of data and artificial intelligence in medical settings.

Why it matters: The goals include setting an AI policy and strategy for HHS and streamlining critical infrastructure protection within the Administration for Strategic Preparedness and Response, or ASPR, per a notice to be published in the Federal Register today.

Details: National coordinator for health IT Micky Tripathi will become assistant secretary for technology policy and take on added responsibility for policy development.

Tripathi's team over the last three and a half years focused on the adoption of electronic health records in hospitals and physician offices.

A key program called 405(d), which is responsible for aligning health industry security practices, will be folded into ASPR to advance what HHS calls "a one-stop-shop approach" to threats like denial-of-service attacks that are plaguing hospitals.

Catch up quick: The massive Change Healthcare cyberattack crippled big parts of U.S. health care and showed how industry contracting practices exposed even those providers who didn't have direct relationships with the claims processing giant.

And the CrowdStrike internet meltdown underscored the sector's reliance on a few key technology companies to meet their IT needs.

Meanwhile, the administration has struggled to keep pace with AI development in health care and been slow to identify what additional powers it needs to oversee medical devices enabled with AI.

What they're saying: "Cybersecurity, data and artificial intelligence are some of the most pressing issues facing the health care space today," Secretary Xavier Becerra said in a statement. "HHS must be agile, accountable and strategic to meet the needs of this moment."

HHS shuffle to address cyber threats, AI

Sign outside the department of HHS building

AvaSure, an acute virtual care provider, acquired Ouva's smart room technology to expand its services, CEO Adam McMullin tells Axios exclusively.

Why it's the BFD: Remote patient monitoring and virtual nursing help lower hospital readmissions by as much as 38% and significantly reduce cost of care.

Zoom in: Backed by Goldman Sachs Growth Equity and The Heritage Group since 2021, AvaSure is generating between $50 million and $100 million in revenue, with EBITDA north of $15 million, according to McMullin.

How it works: AvaSure's acute care services include virtual nursing, patient monitoring and clinical consults as well as inpatient services.

Founded in 2008, the Belmont, Mich.-based company currently has 1,200 health system and hospital clients.

San Francisco-based Ouva provides patient care automation, remote patient monitoring and patient flow automation.

The combined company will expand the ambient AI capabilities of AvaSure's virtual care platform and double in-house AI engineering resources.

What's next: "We're going to be on the acquisitive side where it makes sense to bring in more value," McMullin says.

Catch up quick: Last year, AvaSure and Ouva established a partnership to integrate Ouva's comprehensive AI capabilities with the AvaSure platform.

State of play: Remote patient monitoring continues to rake in venture funding.

Accuhealth received a $200 million investment from Sunstone Partners in April.

HealthSnap raised a $25 million Series B in February.

Resilience, a oncology RPM company, raised $25 million in May.

AvaSure buys Ouva's smart room solutions

Computer mouse in the pocket of a nurse with a stethoscope

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

• Kestra Medical Technologies, a Kirkland, Wash., cardiac arrest monitoring company, raised $196m in unlabeled funding co-led by Andera Partners, Ally Bridge Group, Longitude Capital and Omega Funds, with participation from T. Rowe Price, Eventide Asset Management and Gilmartin Capital. Go deeper

• Hive Health, a Philippines-based digital health insurance company, raised $6.5m in pre-Series A funding from Gentree Fund, BEENEXT, Y Combinator, The Graduate Syndicate, Amasia and Oak Drive Ventures. Go deeper

• SlicedHealth, a Woodstock, Ga.-based cloud company for hospitals, raised a $5m Series A led by Arthur Ventures. Go deeper

• Intron Health, a Nigerian speech recognition company, raised a $1.6m pre-seed led by Microtraction. Go deeper

• Astorg acquired and will take take private Hamilton Thorne, Cook Medical's Beverly, Mass., reproductive health business for 388m CAD. Go deeper

•  Olympus Partners sold Soliant, a Peachtree Corners, Ga., health care staffing and recruiting firm to Vistria Group for more than $2b. Go deeper

• Edwards Lifesciences, an Irvine, Calif., medical device company, acquired JenaValve Technology, an Irvine medical device company and developer of a transcatheter heart valve technology and Endotronix, a Naperville, Ill., producer of an implantable heart failure monitor for $1.6b. Go deeper

• Amulet Capital Partners, a Greenwich, Conn., middle-market PE firm, closed its fund III at $1.2b. Go deeper

Deals o' the day

• Chris Dorn, former managing director at BTIG, joined Fifth Third Securities as managing director for HCIT. Go deeper

• Christina Farr, former principal investor at OMERS Ventures, joined Manatt, Phelps & Phillips as managing director. Go deeper

• David Arnon, formerly CEO of DORAL MEA, joined SHL Telemedicine as CEO, succeeding Erez Nachtomy. Go deeper

• Stephanie Fagan, formerly the chief communications officer at Agenus, joined MindMed (Nasdaq: MNMD) as chief corporate affairs officer. Go deeper

• Miles Ennis, formerly SVP of worldwide sales at Talkdesk, was named chief revenue officer at Komodo Health. Go deeper

• Shane Smith, formerly with United Airlines, joined Intelliguard in the newly created role of chief strategy officer. Go deeper

• John Ragard, a senior investment advisor at Wayve Capital Management, was appointed to the board of Aspira Women's Health (Nasdaq: AWH). Go deeper

• Cathy Jack announced she is stepping down as chief executive of Northern Ireland's largest health trust, Belfast Trust. Go deeper

It's Personnel

🤖 SearchGPT: blessing or burden for health care? — Forbes

🧠 Cost hurdles to mental health care — Axios

❌ Bankrupt Steward Health to close two Massachusetts hospitals — Reuters

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July 29, 2024

1 big thing: HHS shuffle to address cyber threats, AI