Hybrid primary care company One Medical has announced its plans to acquire Medicare-focused provider Iora Health for $2.1 billion. The company plans to use this M&A to gain a foothold in the Medicare space.
- Better clinical opportunities: Like One Medical, Iora Health offers brick-and-mortar clinician offices as well as digital tools. Geared at the 65-and-older population, Iora assigns each member a provider, nurse, and health coach. Both patients and their families can be connected to caregivers through the company’s platform.
- Enhanced expansion: “Together we will expand our addressable market to serve more members in more geographies with digital and in-person care across every stage of life, with further capabilities to deliver care within full-risk models. Together with Iora Health, we can deliver better health, better care, and lower costs for children, adults, and seniors,” Amir Dan Rubin, chair and CEO of One Medical, said in a statement.
- New partnership benefits: One Medical said this new acquisition will help it expand its full-risk models, as well as expand into new populations. The transaction is expected to close in late Q3 or Q4 of 2021. After the acquisition closes, Iora Health’s CEO Rushika Fernandopulle will join One Medical as chief innovation officer. Additionally, after the close, the joint company will be able to hit 28 markets across the U.S.
- The rise in Stocks: Both One Medical and Iora Health have been in the digital health space for some time. Iora was founded in 2010, and One Medical has been around since 2007. In early 2020, One Medical went public. The stock is now trading for roughly $35 per share on NASDAQ. In its SEC filing, One Medical said there is an $870 billion market opportunity across commercial and Medicare segments. According to the companies, Iora Health currently provides care to 38,000 Medicare patients across 47 clinics.
- Profitable memberships: “One Medical has proven its ability to drive profitable membership growth, engage with members, improve health outcomes, and lower costs. I am excited at the prospect of creating even more differentiation by adding Iora Health’s Medicare-focused capabilities, expanding our reach to 28 markets, and offering our service experience to the parents and grandparents of our 598 thousand members,” Bjorn Thaler, the chief financial officer of One Medical said in a statement.
