SKANEATELES FALLS — With its recent acquisition of a Nebraska–based medical software firm, Welch Allyn, Inc. is making a bet on medicine’s move toward telehealth — monitoring and treating patients remotely with digital technologies. The Skaneateles Falls–based manufacturer of medical-diagnostic equipment announced Dec. 8 that it has acquired substantially all the assets of HealthInterlink, LLC […]
SKANEATELES FALLS — With its recent acquisition of a Nebraska–based medical software firm, Welch Allyn, Inc. is making a bet on medicine’s move toward telehealth — monitoring and treating patients remotely with digital technologies.
The Skaneateles Falls–based manufacturer of medical-diagnostic equipment announced Dec. 8 that it has acquired substantially all the assets of HealthInterlink, LLC of Omaha, from its investment-firm parent Prairie Ventures.
Financial terms of the all-cash deal were not disclosed. The transaction closed on Nov. 7, according to Welch Allyn.
HealthInterlink is a developer of a software-based remote patient vital-signs monitoring system. This is Welch Allyn’s first foray into remote patient vital-signs monitoring, the company said.
How the deal came about
Welch Allyn recently identified the telehealth space as a potential new growth lever for the company. A dedicated team spent several months studying and researching the emerging telehealth market, including networking with leaders in the field and identifying partnership opportunities, Scott Gucciardi, Sr., vice president of new healthcare delivery solutions at Welch Allyn, explained in an email.
“Our intent was to identify opportunities for Welch Allyn to add value by helping healthcare delivery stakeholders adapt to the growing challenges they are facing due to budget and reimbursement cuts, increasing prevalence of chronic diseases, and the need to move toward population health management,” he said.
Remote patient monitoring provides a solution for managing the increasing rise and cost of chronic disease, Welch Allyn contends.
The Welch Allyn team first met officials from HealthInterlink, including one of its founders, at the American Telemedicine Association international meeting and trade show in May of this year, Gucciardi recounted. The event took place in Baltimore.
The market and the product
A report from information and analytics firm IHS a year ago estimated that the U.S. teleheath industry will grow to $1.9 billion in total revenue by 2018 from $240 million last year, according to a Dec. 22, 2013 article on Forbes.com.
HealthInterlink’s telehealth product incorporates wireless patient-monitoring devices and a mobile gateway device, (like a tablet or smartphone) that transmits vital-signs data, answers to patient-care plan questions, and patient messages to a HIPAA-compliant, cloud-based, web portal for patient-data management by health-care professionals, Welch Allyn explained in a news release.
The acquisition of the HealthInterlink assets offers Welch Allyn a “unique opportunity to better serve its U.S. customers by offering them [a technology] solution optimized for cost-effective collection and delivery of remote health information,” according to Welch Allyn President and CEO, Stephen Meyer.
“The acquisition of HealthInterlink’s assets is exciting news for Welch Allyn and is in keeping with our vision to help transform care wherever patients and healthcare professionals connect,” Meyer added in the release. “As healthcare delivery becomes decentralized and extends beyond the traditional acute and ambulatory care locations where our offerings are used today, we intend to provide solutions that enable providers to deliver high quality care, regardless of location.”
During a transition period, that will end on or before June 30, 2015, HealthInterlink’s current product will continue to be developed, sourced, and sold by the Nebraska firm’s existing workforce, according to Welch Allyn.
HealthInterlink has five direct employees in Omaha who work in software development, sales, and product management. Those employees, along with others who work in support functions for the former parent company, Prairie Ventures, will provide services to Welch Allyn under a transition services agreement, according to Welch Allyn’s Gucciardi.
The five direct employees have been asked to remain with the company in their current capacity at least through the transition period. And, Welch Allyn may end up offering them permanent positions depending on business needs, he added.
Welch Allyn says its acquisition integration team is currently determining which business processes — such as kitting of home vital-signs devices, sales order management, and customer and technical service — will be shifted to other Welch Allyn facilities, including the Skaneateles Falls headquarters.
Welch Allyn employs more than 2,600 people in 26 different countries. It has 1,300 employees in Central New York. The Business Journal News Network estimates Welch Allyn’s annual revenue at about $700 million.
Prairie Ventures, based in Omaha, says it’s a private investment firm with investments in health-care technology and services.
“We are very pleased that another of Prairie Ventures’ start-ups has been acquired by an industry leading commercial partner,” Craig Tuttle, president of Prairie Ventures, said in a news release announcing the deal. “HealthInterlink is a great example of a software technology company that we funded from start-up through to early product sales, which a very large and successful healthcare company recognized and then acquired.”
Contact Rombel at arombel@cnybj.com