Amwell is acquiring two digital health companies for $320 million to expand its services beyond telehealth visits.
The virtual care company is scooping up SilverCloud Health, a digital mental health platform, and Conversa Health, which offers automated virtual healthcare.
The addition of the two companies' technology will help to differentiate Amwell from other telehealth players, company executives said.
"Each company brings unique, proven capabilities that will position Amwell to materially advance the reach and impact of care teams on patients’ lives through the use of interactive tools that strengthen the cohesion between physical and virtual care," Amwell executives said in a press release.
“We believe that future care delivery will inevitably blend in-person, virtual and digital care experiences and as such, we are uniquely building a global platform to support such advanced, coordinated care,” said Ido Schoenberg, chairman and co-CEO of Amwell, in a statement.
“By integrating SilverCloud Health and Conversa Health into our platform we are demonstrating Amwell’s fundamental and repeatable design to continually scale digital healthcare services across the different sites of care. These acquisitions will amplify the presence and reach of care teams and reaffirm that as the needs of the healthcare marketplace evolve, so too will the Amwell platform," he said.
Boston-based SilverCloud Health was born out of over a decade of research, according to the company. Launched in 2012, SilverCloud provides a range of digital cognitive behavioral health programs for healthcare systems and providers, health plans, and employers. The company's digital self-guided mental health programs provide patients with customized content programs and support to treat more than 10 specific conditions including anxiety, depression, chronic stress, sleep insomnia and grief and loss.
The Irish Times reported that Amwell paid in excess of $250 million for Dublin-based SilverCloud Health, citing informed sources.
Through real-world results and randomized control trials, SilverCloud has shown clinical effectiveness on par with face-to-face therapy. Up to 85% of patients who use SilverCloud showed clinical improvement in depression and anxiety symptoms and 65% of patients showed clinically significant improvement, the company said.
Used globally by more than 300 organizations including Kaiser-Permanente, Optum, Providence Health and over 80% of the U.K.’s National Health Service mental health services, Amwell will leverage SilverCloud Health’s platform to scale up its own behavioral health offerings, as well as to develop new digital specialty care programs, according to executives.
Portland, Oregon-based Conversa Health offers an AI chatbot for virtual care. The startup provides automated and personalized digital check-ins with patients, such as asking how they feel and asking if they’re taking their medications. It works with health systems such as Northwell Health, UCSF Health, UNC Health, University Hospitals and Prisma Health to remotely engage patients by delivering automated text-based conversations to support a wide range of clinical needs—from pre-admission patient education and preparedness to post-acute monitoring to chronic care management.
Amwell plans to leverage Conversa Health’s proprietary patient profiling and health signals engine and library of evidence-based digital pathways to advance initiatives aimed at longitudinal care, clinical quality and population health, the company said.
With the addition of SilverCloud Health and Conversa Health's capabilities, Amwell plans to develop new digital care workflows and programs to improve patient engagement and care team reach, as well as to advance care delivery outcomes. Initial efforts will focus on virtual care automation and patient companionship to advance longitudinal care, behavioral health and other specialty and chronic care segments.
The acquisitions also accelerate Amwell's growth opportunities in new markets and expand its current client base to include hospital, health system, health plan and employer clients of Conversa Health and SilverCloud Health.
Amwell also benefits from SilverCloud Health's international footprint as the startup has headquarters in London and Dublin and is used by the national health systems in the U.K. and Ireland.
“There is a tremendous unmet need for mental health solutions in today’s world. While SilverCloud Health’s mental health programs have been used to support over 750,000 people to date, in partnership with more than 300 organizations globally including The Irish Health Service Executive and over 80% of the U.K.’s NHS mental health services, our work has only just begun,” said Ken Cahill, CEO of SilverCloud Health in a statement.
Amwell's market reach provides SilverCloud Health with the access and resources to become the "true global leader of digital mental health care delivery," Cahill said.
"Blending physical, virtual, and automated care is a game-changer for patients and providers alike. This is a big step for Conversa, and a giant leap for healthcare," said Murray Brozinsky, CEO of Conversa Health.
Amwell's 2020 revenue reached $245 million, up 65% from $149 million in 2019 but the company losses also soared as it recorded a net loss of $229 million for the full year, compared to an $88 million loss in 2019.
Amwell went public in August after raising $742 million with the sale of 41.2 million class A shares at $18 apiece.
Amwell expects to fund the transactions using a mix of stock and cash. On a standalone basis and excluding any deferred revenue write-downs, aggregated 2021 calendar revenue of Conversa and SilverCloud is expected to be approximately $15 million with an anticipated revenue growth rate of approximately 100% in 2022, the company said.
The deal is expected to close in the third quarter of 2021.
Barclays acted as exclusive financial advisor and Ropes & Gray LLP acted as legal counsel to Amwell on both Transactions. Cantor Fitzgerald & Co. Acted as exclusive financial advisor to Silver Cloud Health.