SOC Telemed (formerly Specialists on Call) announced yesterday that it has purchased fellow acute care telemedicine provider Access Physicians.
The cash and stock transaction is valued at roughly $194 million, with the potential for additional considerations based on performance.
WHAT'S THE IMPACT
SOC Telemed was already a major name in the enterprise telemedicine space. The company reported about $58 million in annual revenue in SEC documents filed yesterday and last year disclosed that it provides services to more than 800 healthcare facilities. Its offerings consist of a secure tech platform and doctor-staffed virtual care services covering more than 20 clinical service lines, including neurology, psychiatry, critical care and pulmonology.
With Access Physicians, SOC Telemed said it will reach nearly 1,000 facilities (including more than 700 hospitals) across 47 states. It expects its revenue for 2021 to land between $107 million and $113 million, with about 30% to 35% of that being contributed by Access Physicians' multi-specialty services.
Notably, SOC Telemed highlighted Access Physicians' variety of specialty offerings, which include infectious disease, cardiology, maternal-fetal medicine and nephrology. With the merger, a combined roster of 750 available clinicians will be able to bring the full collection of specialty services to SOC Telemed's and Access Physicians' prior customers, they said.
"Access Physicians and SOC Telemed's technology-enabled, multi-specialty clinical solutions and customer base are complementary and serve to capitalize on the growth opportunities in acute care telemedicine," John Kalix, CEO of SOC Telemed, said in a statement. "As we work to address health inequities, our combined organization creates a single partner for customers to optimize care delivery."
THE LARGER TREND
The acquisition announcement came alongside SOC Telemed's earnings report. Here, the company reported quarterly revenue that was lower than the previous year's Q4, which it attributed to COVID-19's impact on hospital-based specialty services. More impactful for after-hours investors was greater-than-expected losses tied to the lowered revenue and the merger deal, although the company's stock already appears to be recovering from a reactionary dip.
Those financials are now in the public eye following SOC Telemed's special purpose acquisition company (SPAC) merger. First announced last summer, that deal was on the front end of digital health's long line of SPAC mergers over the last several months.
SOC Telemed has plenty of competition in the broader telehealth and telemedicine market, which generally enjoyed new demand as COVID-19 highlighted the value of virtual care. While many of these major players have offerings designed for provider organizations, of particular note is Teladoc Health and its recently closed acquisition of InTouch Health.
ON THE RECORD
"Access Physicians has long held a commitment to providing the very best patient care possible, and we felt SOC Telemed shared that mission," Dr. Chris Gallagher, CEO of Access Physicians and now a board member of SOC Telemed, said in a statement. "We sought out a company that would not only share our vision, but also broaden our combined capabilities to accelerate the realization of our vision."