Saturday, December 3, 2022

Wheel to buy GoodRx’s backend virtual care tech for $19.5M

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Telehealth staffing and services company Wheel will acquire GoodRx’s backend virtual care technology for $19.5 million in cash. 

The deal, which is expected to close at the end of the month, includes GoodRx Care’s EHR, clinical management tools and patient experience software. 

Wheel will integrate the tech into its virtual care offerings, though GoodRx will continue to own and operate its consumer-facing telehealth website and mobile app. About 20 GoodRx employees will receive offers to join Wheel. 

The companies have worked together since 2020. GoodRx, which is best known for its drug price transparency offerings, said the acquisition will give it flexibility to continue offering telehealth tools. 

“We believe Wheel is the ideal strategic partner for this acquisition,” Doug Hirsch, co-CEO and cofounder of GoodRx, said in a statement. “Wheel has provided technology and clinicians for GoodRx Care for several years, giving us high confidence in their ability to operate and grow the platform. By entering into a long-term strategic arrangement, we look forward to deepening our mutually-beneficial relationship. We are excited to see how Wheel continues to leverage the amazing tools our team developed.”

THE LARGER TREND

This deal marks Wheel’s first acquisition. Founded in 2018, the startup launched two years later alongside a $13.9 million Series A raise. In early 2022, Wheel announced it had scooped up $150 million in Series C funding

However, in August, Insider reported Wheel had laid off 35 employees, or about 17% of its workforce. A number of digital health and health tech companies have announced layoffs this year as investment dries up compared with the booming funding environment seen in 2021.

GoodRx reported its third quarter earnings this week, posting $187.3 million in revenue compared to $195.1 million during the prior-year period. Net loss was $41.7 million compared to a net loss of $18.1 million in 2021, which GoodRx attributed to a previously mentioned issue with a national grocery chain and expenses related to its vitaCare acquisition.

Adjusted EBITDA was $52 million compared to $61.8 million in the prior-year period, which GoodRx said was largely driven by the grocer problem.

The company also laid off workers this year, cutting approximately 16% of its staff. GoodRx recently launched a provider-facing drug cost transparency platform that will also feature strategic partnerships with pharmaceutical companies.



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