OptimizeRx, a software company that enables digital health messaging between pharmaceutical companies and providers, plans to acquire New York-based RMDY Health for $16 million.
Shareholders of RMDY Health—a software as a service platform for digital therapeutics products—will receive $8 million in cash and $8 million in equity when the transactions closes, according to a release. RMDY Health’s estimated annual revenue for 2019 is $3 million.
OptimizeRX reported $21.2 million in revenue in 2018, up 75% from $12.1 million in 2018.
The RMDY Health platform is used by pharma, payers, medical technology companies and medical associations. The acquisition adds three new client segments to OptimizeRx’s existing patient engagement platform—payers, medtech and medical associations—further simplifying chronic disease management and drug adherence for healthier results at lower costs, the company said in a press release.
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OptimizeRx's platform integrates with electronic health records and e-prescribing systems to deliver direct messaging between pharmaceutical companies and providers and patients. The addition of RMDY Health expands OptmizeRx's reach by using patient apps and web access as an additional channel for digital health messaging, according to the company.
The deal marks the second patient engagement-focused acquisition for the Rochester-based company within the last year. OptimizeRx acquired CareSpeak Communications, a medication adherence and care coordination messaging company, for $9 million last year.
According to OptimizeRx, the addition of RMDY further diversifies the company’s recurring revenue stream and scales its solution set to better address larger opportunities in digital health.
"This acquisition is especially timely, given how stakeholders are increasingly shifting their budgets to digital delivery as the preferred method of communicating to physicians and patients," William Febbo, CEO of OptimizeRx, said in a statement.
Adding RMDY Health’s capabilities to OptimizeRx's platform extends the company's ability to engage doctors and patients for its pharmaceutical clients, Febbo said. "We can now further bridge the critical communication gaps between pharma, healthcare providers, payers, medical associations and patients," he said.
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Digital therapeutics offer several intervention tools to treat chronic conditions, including diabetes and heart disease. Patient programs can include treatment information, lifestyle and condition trackers, Internet device connectivity, forms and surveys, supported by communications delivered via live chat, bots, audio, and telehealth.
The global market for digital therapeutics is growing at a compounded annual growth rate of 21% and is expected to hit $9.4 billion by 2025, according to Grand View Research.
“DTx programs are widely considered highly effective, yet such solutions usually require expensive and complex implementations,” RMDY Health CEO and co-founder Dr. Amir Kishon said in a statement. “RMDY was built to help eliminate this cost and complexity. Our technology platform makes it possible for any health stakeholder to rapidly and effortlessly digitize their programs and connect directly with patients, which is increasingly becoming the standard delivery format."
RMDY's technology team will remain in Tel Aviv, Israel while U.S.-based staff will join OptimizeRx at its New Jersey headquarters.