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Two of the nation’s largest membership-based primary care groups are joining forces.
San Francisco-based One Medical announced yesterday it is acquiring Iora Health, headquartered in Boston, in a stock transaction valued at about $2.1 billion. The combined company will have approximately 600,000 members and locations in 28 geographic markets, with access to about 40% of the U.S. market.
“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,” Amir Dan Rubin, chair and CEO of One Medical, said in a press release announcing the acquisition.
“We are excited to take this next exciting step with One Medical,” said Rushika Fernandopulle, MD, MPP, co-founder and CEO of Iora Health. “Together we can drive even greater impact for our patients, our teams, and our investors, and most importantly, our shared vision of transforming healthcare.”
Under terms of the agreement, Fernandopulle will become One Medical’s chief innovation officer, and one representative of Iora will join One Medical’s board of directors. The transaction is expected to close in the third or fourth quarter of 2021.
According to the news release, the combined company expects to earn about $350 million annually by 2025, and envisions “potential market opportunity” of $860 billion among patients covered by commercial insurers and Medicare, including Medicare’s recently-unveiled Global and Professional Direct Contracting Model.
“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,” said Bjorn Thaler, One Medical’s chief financial officer.