Pune, India-based Persistent Systems acquired Herald Health, a two-person health tech startup with successful pilots at Brigham and Women's and Boston Childrens hospitals in Boston, for a total valuation of $5.2 million, MobiHealthNews has learned. Multiple Indian publications are reporting the $5.2 million figure (which the companies did not disclose) including the Economic Times, which reports $2.3 million has been paid out upfront with another $2.9 million contingent on performance and retention of founders Dr. Brad Diephuis and Dr. Andrew Hillis. The acquisition closed on August 24th.
"The view is that we want to continue building out the Herald product and have it be a product that is sold within the Persistent ecosystem," Diephuis told MobiHealthNews. "So as part of the acquisition process we sat down with stakeholders at Persistent and said, these are some revenue goals over the next two to three years, these are the areas we want to grow out the product into. And so the mission is really for this to grow out and stay as a product that will be an independent product sold by Persistent, and that over time may or may not end up folded into their other efforts as we go on with further development."
Herald Health makes a software platform that allows various hospital stakeholders to be automatically notified when data in the EHR and other data systems changes. The company was founded in 2015 and has not raised funding or hired full-time employees beyond the two cofounders.
"We actually got our start, of all places, at a hackathon at Brigham and Women’s Hospital. At the time I was in medical school." Diephuis said. "...The pain point that we felt very acutely as trainees was this expectation that in the morning you would say ‘These are the tests that we’re going to run and in the course of the day we’re going to see what comes back and take action based on those.’ Unfortunately, the way the system was constructed was that the only way to do that was to frequently pull data out of the EMR — so going through the charts and hitting refresh all the time, rather than having a system that would proactively push out the data to you. And so Herald was really started in an effort to solve this problem."
After a 2016 pilot at the Brigham focused on doctors, Diephuis and Hillis realized the technology had potential beyond that.
"You can imagine that in the same way a physician would want to know a lab test had come back, an operations person might want to know ‘That bed just became available' or a care coordinator might want to know ‘Oh a patient with this particular insurance type just showed up in this particular care setting,'" Diephuis said. "The more and more we talked with other hospital systems — and really we learned a lot from the system we were in, at Brigham — the more we realized this was really not just a single product, but a platform."
Persistent and Herald crossed paths a few years ago because Persistent, which makes clinical decision support systems, also has a four-year partnership with Brigham and Women's parent company Partners Healthcare.
"We had developed a great product that we viewed as having significant impact on patient care in the hospitals we were at. What we didn’t know was how to effectively scale this up and how to really maintain relationships with hospital systems across the country," Diephius said. "And Persistent was a partner that had a ton of hospital relationships across the country and had a long history of, you know, deep strategic relationships with clients in general. So there were a lot of ways that we could benefit from the network that Persistent had built out and then they could benefit from the product that we had built."