Invitae scoops up consumer health tech firm Ciitizen for $325M

Mergers and acquisitions deals consolidation
By bringing in Ciitizen, Invitae will be able to develop a centralized hub for medical data, including consumers' genomic and clinical information, that can help drive research and improve healthcare decision-making. (Getty/Kritchanut)

Medical genetic company Invitae will acquire consumer health technology company Ciitizen for $325 million in a bid to make it easier for patients to collect their genomic and clinical information.

Ciitizen, a company backed by several investors including 16z, Section 32 and Verily, is focused on building a global platform to help patients collect, organize, store and share their medical records digitally.

Invitae is working to aggregate results from the world's genetic tests into a single, easy-to-use service that makes genetic information accessible to all who can benefit from it. Over the past five years, the company has completed 13 acquisitions that have expanded its testing menu, lowered the cost of its tests, improved its customer experience and enhanced its ability to attract partners, according to the company.

Invitae, which went public in 2015, raised more than $1.4 billion since the beginning of 2021, in part to identify and acquire key assets to expand its capabilities.

By bringing in Ciitizen, the company will be able to develop a centralized hub for medical data, including consumers' genomic and clinical information, that can help drive research and improve healthcare decision-making, company executives said.

In a blog post, Ciitizen co-founder Anil Sethi said the company's mission was to "put the power of medical data in the hands of the patient."

RELATED: Health tech startup Ciitizen acquires Stella Technology's HIE business to improve patient access to health records

"Our core value stays the same: that your data belongs to you and you get to decide how it is used and shared. Invitae, like Ciitizen, was founded upon a patient-first philosophy and is committed to helping you get the care you need while keeping your data private and secure. As always, we can only share your data with your explicit consent," Sethi wrote.

Sethi founded Ciitizen in 2017 following the death of his sister, Tania, who had metastatic breast cancer. He was driven to help put patients in control of their health data and connect cancer patients to potentially life-saving clinical trials.

He noted that patients "leave a breadcrumb trail of records behind them," and access to these real-world data is key to personalized therapeutics in the future.

"The combination of lifelong health history together with Invitae's world-class genetic and data services would enable a digital ecosystem of personalized services for each patient," Sethi said.

San Francisco-based Invitae launched in 2010 with a goal to bring comprehensive genetics into mainstream medicine to improve healthcare for billions of people, Sean George, Ph.D., co-founder and CEO of Invitae, told Fierce Healthcare.

"We are doing this by aggregating the world's genetic tests into a single service to make genetic information accessible to all who can benefit from it, and the acquisition of Ciitizen is a major step forward in our mission," he said.

The acquisition propels Invitae from being a testing company to a genetic testing, software and health information technology leader, George noted.

"This acquisition moves us closer to our vision of an open-ended network of genetic and clinical information controlled by patients and applied to the betterment of their health and that of their communities."

RELATED: Invitae's double deal day: A genomics buyout and $1.2B in SoftBank-led financing

Ciitizen’s platform turns documents into computable, digital, relevant data that can be used however patients wish and unlocks the benefit from their full range of health data, George said.

A cancer patient may be seen by dozens of specialists across institutions, many of which may not have the patient’s full health history and data—from their genetic testing results to previous treatments and family history. Yet there may be important details in those data that could extend their life. This is just one example of how thousands of patients, their families and providers can benefit from Invitae’s platform with the addition of Ciitizen.

"That patient-centric orientation also sets them and us apart from the other data companies emerging today, whose strategy is to aggregate data from various organizations and send that data to interested parties for their benefit—oftentimes without the input, permission or real transparency to the patients themselves," he said.

Financial terms of the deal

Under the terms of the deal, Invitae will acquire Ciitizen for $325 million, consisting of about $125 million in cash and 7 million shares of common stock based on average closing price before the agreement date. Invitae will also issue approximately $225 million in restricted stock units to Ciitizen employees who join Invitae as part of the acquisition. The RSUs, which will cover up to 8.1 million shares of Invitae common stock and vest in three tranches, will be given to 99 recipients, while Sethi will receive RSUs comprising 2 million shares of Invitae common stock.

RELATED: How Datavant's $7B deal with Ciox Health impacts the health data market

The deal comes as real-world patient data are becoming increasingly valuable in the healthcare industry. 

There have been several major deals in the healthcare and life sciences spaces focusing on advancing real-world data and clinical research. Venture capital-backed Datavant is combining with clinical data network Ciox Health in a deal valued at $7 billion.

Health IT giant Cerner acquired the health division of Kantar Group for $375 million to advance clinical research development. Cerner is setting its sights on building a $1 billion data business for the healthcare and life sciences industries based on the acquisition.

EHR competitor Allscripts also has put significant investment in its Veradigm business, which is the largest linked EHR claims patient database available for research sourced from and directly connected to clinical platforms.

Startups in the space also are attracting large investments. Healthcare "map maker" Komodo Health recently netted $220 million in new funding to build out its data analytics platform for healthcare and life sciences research. The funding round propelled Komodo Health to a $3.3 billion valuation, according to the company.