Telehealth is quickly disrupting the $11.9 trillion healthcare market, showing no signs of slowing. All as consumers opt to visit with physicians online rather than face to face. In fact, a recent McKinsey & Co. report says nearly 76% of consumers are moderately or highly interested in telehealth, as compared to just 11% in 2019.
Even more impressive, big investments are just beginning to flood into the sector. Just over the last few months, Teladoc Health announced it would acquire Livongo Health in a deal valued at $18.5 billion. Johnson & Johnson just invested $47 million in direct-to-consumer telehealth company Thirty Madison. Humana just invested $100 million into telehealth startup, Heal. Telemedicine provider Ro just raised $200 million, and has already grown to five million patient-physician interactions. CloudMD Software & Services Inc. has also acquired several companies as it expands its global footprint, including a U.S. based chronic care medical clinic, which will allow it to capitalize a massive $3.5 trillion mental health disease market.
In addition, according to a report from Frost & Sullivan, the telehealth industry could grow sevenfold by 2025. With explosive growth in store for telehealth, some of the top companies to be well aware of include CloudMD Software & Services Inc. (TSXV:DOC) (OTCQB:DOCRF), Teladoc Health Inc. (NYSE:TDOC), 1Life Healthcare Inc. (NASDAQ:ONEM), Zoom Video Communications Inc. (NASDAQ:ZM), and Amwell Corp. (NYSE:AMWL).
CloudMD Software & Services Inc. (TSXV:DOC)(OTCQB:DOCRF) BREAKING NEWS: CloudMD Software & Services Inc., a telehealth company revolutionizing the delivery of healthcare to patients, is excited to announce that it has entered into a Binding Term Sheet (“Term Sheet”) to purchase a majority interest in Benchmark Systems Inc. (“Benchmark”), a leading cloud-based provider of fully integrated solutions that automate healthcare workflow processes including revenue management, practice management and electronic records management. CloudMD will purchase 87.5% of Benchmark from Benchmark’s parent company and global healthcare and AI leader, AntWorks Inc. (“AntWorks”). AntWorks will retain a 12.5% equity stake and remain a strategic partner for CloudMD both in the U.S. and globally.
Leveraged by 42 years of experience, Benchmark develops and delivers innovative cloud-based technology, integrated medical practice solutions including patient portals, personal health records, scheduling solutions, billing, messaging, eFax, computerized physician order entry (CPOE) and prescription scripting. Benchmark has a national U.S. network of 200 clients, 800 physicians, with 5.5 million patient charts across 35 states. On average, Benchmark processes approximately $2.5 million in charges (gross) each month.
The COVID-19 pandemic has exponentially accelerated transformational changes in how healthcare is accessed and delivered to patients while addressing the challenges of providing quality, cost effective and personalized patient centric care. Benchmark’s integrated solutions and its suite of medical software has been built alongside healthcare providers to create a more seamless, patient centric approach to healthcare, while solving profitability, productivity and quality issues, translating into improved health outcomes and financial performance.
As CloudMD continues to embark on its U.S. expansion, the acquisition of Benchmark positions CloudMD with a strong footprint across North America. The acquisition brings synergies through Benchmark’s 200 clinic ecosystem across over 35 states in the U.S. Benchmark’s suite of software solutions provides CloudMD with significant distribution channels into the U.S. and integration opportunities for its other virtual care solutions such as those offered through Cloud Practice, Snapclarity and iMD Health. With Benchmark’s experienced leadership team, and seamless workflow process, CloudMD will not only benefit from its extensive geographic reach and client commitment, but also the expertise of developing SAAS systems that support medical practitioners while complying with specific state requirements.
AntWorks is a global leader in artificial intelligence (AI) and intelligent automation, creating new possibilities with data through digitization, automation and enterprise intelligence. As the world’s first and only Integrated Automation Platform (IAP) powered by fractal science principles and pattern recognition that understands every data type, ANTstein™ digitizes every type of data type for a diverse range of industries. As a minority holder of Benchmark, AntWorks will continue to work with CloudMD providing expertise in global hyper automation and AI and provide access to cutting edge AI technologies.
The purchase of Benchmark will be immediately accretive to CloudMD and provides a number of opportunities for optimization to drive further revenue. In the fiscal year ending March 31, 2020, Benchmark generated approximately US$4.9 million in revenues with earnings before interest, taxes, depreciation and amortization (EBITDA) margins of 13%. Approximately 80% of revenue was SAAS based, recurring revenue.
Essam Hamza, CEO of CloudMD commented, “We believe that Benchmark will expedite our U.S. expansion efforts and enhance the quality, operations and scalability of our business. Benchmark is already well-established in the marketplace and their significant U.S. presence will help us navigate individual state requirements, while providing opportunities for existing software integration, cross selling and revenue optimization.” Amit Mathur, President of CloudMD added, “The current healthcare sector is prime for this automation technology which streamlines manual processes and makes them way more efficient. We look forward to working with AntWorks, a world leader in AI and automation, as we look to continue our expansion globally.”
Asheesh Mehra, Group CEO and Co-Founder of AntWorks says, “We look forward to working with CloudMD to continue delivering on our shared commitment of providing holistic, patient centric care. Benchmark’s suite of revolutionary, AI driven software is already well established in the United States. Govind Sandhu, COO and Co-Founder of AntWorks adds, “With CloudMD’s healthcare expertise, proprietary telemedicine, mental health and patient education software, we are confident the synergies in this partnership will continue to expand the markets we serve and provide better, whole patient care to our combined network in North America and globally.”
Terms of Agreement
In consideration for the purchase of 87.5% of the outstanding securities of Benchmark, CloudMD has agreed to pay shareholders aggregate consideration of US$4,375,000 payable in cash.
The acquisition is subject to customary closing conditions, including the execution of a definitive acquisition agreement. The company anticipates a definitive agreement on or before October 15, 2020.
Other related developments from around the markets include:
Teladoc Health Inc. (NYSE:TDOC), the global leader in virtual care, is providing free, 24/7 general medical telehealth visits to residents, first responders and others directly impacted by Hurricane Sally and the devastating floods that have affected the area as a result. Individuals from the hardest hit areas in Alabama and Florida, as well as those located in Georgia and the Carolinas who are now being displaced can seek treatment from a board-certified, state licensed physician for any non-emergency illness by calling Teladoc directly at 855-225-5032. “Especially during this hurricane season, as communities are already navigating an active pandemic, we want to make sure that those who are faced with the devastation of natural disasters are keeping their health front and center and know how to get care,” said Dr. Lewis Levy, FACP, chief medical officer, Teladoc Health. “Virtual care is a proven solution that supports community health during these times, as residents from evacuated areas seek to stay healthy when healthcare facilities and providers may also possibly be affected and unable to meet all care needs.”
1Life Healthcare Inc. (NASDAQ:ONEM) and The Ohio State University Wexner Medical Center will partner to deliver seamless coordinated care in Columbus and the central Ohio region. The partnership will provide central Ohio residents access to One Medical’s modernized primary care model, which supports seamless access to Ohio State’s network of highly ranked specialists, ambulatory facilities and hospitals. One Medical’s membership-based model combines 24/7 on-demand access to telehealth services, paired with convenient in-person care. In addition to a direct-to-consumer membership, more than 7,000 employers have sponsored memberships on behalf of their workforce. Together, the two organizations will aim to achieve greater clinical integration and deliver exceptional value to consumers and employers. “As an academic health center, we are focused on transforming from a health system to a comprehensive health platform that provides innovative care and delivers unparalleled experiences for all those who look to us for care across Ohio and nationally,” said Dr. Hal Paz, executive vice president and chancellor for Health Affairs at The Ohio State University and CEO of Ohio State Wexner Medical Center. “This partnership is an important next step in continuing to expand Ohio State’s outpatient care strategy to meet the needs of the communities we serve by building on our exceptional primary care offerings, increasing access to digital healthcare solutions and improving access to services that are essential to better health.”
Zoom Video Communications Inc. (NASDAQ:ZM), a leading provider of video-first unified communications, announced financial results for the quarter ended July 31, 2020.“Organizations are shifting from addressing their immediate business continuity needs to supporting a future of working anywhere, learning anywhere, and connecting anywhere on Zoom’s video-first platform. At Zoom, we strive to deliver a world-class, frictionless, and secure communication experience for our customers across locations, devices, and use cases,” said Zoom founder and CEO, Eric S. Yuan. “Our ability to keep people around the world connected, coupled with our strong execution, led to revenue growth of 355% year-over-year in Q2 and enabled us to increase our revenue outlook to approximately $2.37 billion to $2.39 billion for FY21, or 281% to 284% increase year-over-year.”
Amwell Corp. (NYSE:AMWL) and Google Cloud announced that they have entered into a multi-year, strategic partnership to deliver transformative telehealth solutions across the global healthcare ecosystem. Together, the companies will endeavor to expand access to virtual care, improve patient and clinician experiences, and leverage their unique capabilities to deliver new, differentiated healthcare solutions—across the continuum of care. The pandemic has resulted in historic telehealth utilization, making it a priority and, in many cases, a preference for patients, providers, and health plans. With this partnership, Google Cloud and Amwell see an opportunity to improve patient and clinician telehealth experiences through technologies that can automate waiting room and checkout; provide automated language translation services; advance population health by making it easier for more patients to receive care; and assist payers and providers in routine tasks.
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