Practice Fusion Raises $70 Million to Fix Healthcare Using Data
Led by Kleiner Perkins Caufield & Byers, investment in nation's largest healthcare platform is biggest health tech equity deal of the year
SAN FRANCISCO, September 24, 2013-- Practice Fusion, the nation's largest and fastest-growing healthcare platform, today announced a $70 million Series D financing round. Led by Kleiner Perkins Caufield & Byers (KPCB) and institutional investors OrbiMed Advisors, Deerfield Management Company and Industry Ventures, with participation by its previous venture capital investors including Artis Ventures, the new funding brings the company's total capital raise to $134 million. The investment will accelerate Practice Fusion's continued leadership in the electronic medical record (EMR) market, expand its offerings to patients and power new clinical data research and development.
"In our mission to drive better health and save lives, Practice Fusion has successfully connected more doctors, patients, labs, pharmacies and imaging centers than any other company in the US," said Ryan Howard, founder and CEO of Practice Fusion. "Kleiner Perkins has a proven record of helping to reinvent industries, including retail, finance and biotech. They're the ideal choice for Practice Fusion at our stage of growth and, together, we are aligned in the pursuit of transforming US healthcare."
Practice Fusion's platform growth has accelerated significantly since its Series C funding in June 2012. More than four million patient visits each month are currently managed on the network, a growth of 75 percent year-over-year. This patient volume has driven expansion of the company's de-identified data platform, which is now the largest, most comprehensive real-time clinical dataset in the US. In a health technology market facing strong consolidation pressures, the company continues to scale quickly, with one in four doctors choosing an EMR selecting Practice Fusion as their solution. In addition, Practice Fusion has experienced significant revenue growth, increasing 300 percent from 2012.
Practice Fusion also announced today that Beth Seidenberg, MD, general partner at KPCB, has joined its Board of Directors. Dr. Seidenberg brings a successful career in life sciences as the founding CEO of two biotechnology companies and as the former senior vice president and chief medical officer of Amgen, Inc.
"Practice Fusion is a breakthrough for healthcare providers and patients," said Beth Seidenberg, MD, general partner at KPCB. "Through my career as a physician, executive and investor, I've witnessed the challenges that get in the way of optimal delivery of healthcare. Practice Fusion is a rare platform company, which we believe will have a real impact on health outcomes and cost. We look forward to supporting the company's efforts to improve the delivery of healthcare."
The fastest growing health tech company
Founded in 2005, Practice Fusion pioneered an innovative free, web-based model for electronic medical record technology. The flexible and affordable EMR quickly attracted attention from independent medical practices across the US. Today, more than 100,000 medical professionals use the EMR platform every month to document, prescribe, order labs, communicate with other providers and earn incentives.
The company has delivered $150 million in federal incentives to community doctors as part of the 2009 stimulus plan's Meaningful Use program (HITECH), an initiative designed to reward the use of certified EMR systems. Practice Fusion was named by providers as the highest rated EMR for family practice in the latest KLAS report and has been rated No. 1 for overall customer satisfaction by Brown-Wilson three years in a row.
In April 2013, Practice Fusion launched its consumer offering at PatientFusion.com. With 30,000 verified doctor profiles and more than two million reviews from patients, the site is the first to offer consumers the combination of online appointment booking, physician quality transparency, instant access to medical records and health spending tools.
A platform for fixing American healthcare
The US healthcare sector is in the midst of a transformational shift toward coordination of care, measurement of performance and cost efficiency. Named a "Technology Pioneer" by the World Economic Forum, Practice Fusion is uniquely positioned to enable national health reform objectives.
Practice Fusion's partnerships with life sciences companies are evolving beyond advertising into new population health management initiatives including compliance with public health guidelines and instant reports on market trends. The company has partnerships in place with 18 of the top 20 US pharmaceutical brands. The population health management market is predicted to exceed $60 billion by 2025.
In addition to life sciences, Practice Fusion has over 300 enterprise partners, including labs, imaging centers and billing services. The company facilitated over one million lab transactions and 2.7 million prescriptions in the past month through its APIs. Practice Fusion plans to expand the API platform in 2014 to reach emerging health developers and the 97,000 mobile health apps currently live on the market, an industry projected to grow to $26 billion by 2017.
Accountable Care Organizations (ACOs) are key drivers for health reform under the 2010 Affordable Care Act and another area of Practice Fusion innovation. Payers and hospitals seeking large platforms for communication, care coordination and clinical research are teaming with Practice Fusion to reach doctors and patients in their coverage areas.
With a clinical dataset four times larger than the Kaiser Permanente and Veterans Administration systems combined, Practice Fusion is developing new opportunities for big data to improve care. In June 2013, Practice Fusion launched Insight – a subscription clinical research tool for partners, medical professionals, reporters, analysts and pharmaceutical brands. With doctors, patients and data at the core of the business, Practice Fusion continues to develop new partnerships that drive revenue, sustainably connect healthcare stakeholders and improve health outcomes.
"OrbiMed believes that digital health offers the ability to personalize interaction between patients and their providers to improve the quality of care and reduce costs," said Steven Yecies, venture partner at OrbiMed. "We are impressed by the critical mass the Practice Fusion team has achieved and are excited about their ability to drive meaningful engagement between the patient and their physician to improve outcomes and build a large-scale business."
•The $70 million Series D round led by Kleiner Perkins Caufield & Byers more than doubles Practice Fusion's previous total funding of $64 million.
•Influential institutional healthcare crossover funds OrbiMed Advisors and Deerfield Management Company also joined this round as new investors, along with Industry Ventures.
•Return investors participating in this round include Artis Ventures, Morgenthaler Ventures, Felicis Ventures, Glynn Capital Management, Band of Angels Acorn Fund, H Barton Co-Invest Fund and Goldcrest Investments.
•Previous investors include Battery Ventures, Greylock Partners, Founders Fund, Western Technology Investment, SV Angel, Auren Hoffman, Hadi Partovi, Ali Partovi, Jed Stremel and Scott Banister.
•Dr. Beth Seidenberg, general partner at Kleiner Perkins and former senior vice president and chief medical officer of Amgen, is joining the Practice Fusion Board of Directors. Michael Harden, partner at Artis Ventures, is also being added to the Board.
About Practice Fusion
Practice Fusion is the largest and fastest-growing healthcare platform, with a mission of connecting doctors, patients and data to drive better health and save lives. A driving force in modernizing American health care, Practice Fusion is used by a community of 100,000 monthly active medical professionals serving 75 million patients. In April 2013, the company launched its consumer-facing platform, Patient Fusion, where patients can find and book appointments with doctors and access their medical records. The World Economic Forum recognized Practice Fusion as a Technology Pioneer for 2013. www.practicefusion.com
About Kleiner Perkins Caufield & Byers (KPCB)
Kleiner Perkins Caufield & Byers (KPCB) has backed entrepreneurs in more than 700 ventures leading to nearly 200 IPOs, over 375,000 jobs and a deep strategic network. The firm has helped build pioneering companies like Align, Amazon, Electronic Arts, Genentech, Genomic Health, Google, Intuit, Juniper Networks, Netscape, Symantec, VeriSign and WebMD. KPCB partners serve on the boards of Amazon, Apple, Bloom Energy, Flipboard, Foundation Medicine, Google, Hewlett-Packard, Nest, Square, Tesaro and Zynga, among others. KPCB accelerates the success of entrepreneurs with a team of partners delivering company-building services including strategy, operational scaling, recruiting, business development, product delivery and marketing communications. The firm invests in all stages from seed and incubation to growth companies. KPCB operates from offices in Menlo Park, San Francisco, Shanghai and Beijing. http://www.kpcb.com
About OrbiMed Advisors
OrbiMed is a leading investment firm dedicated exclusively to the healthcare sector, with approximately $7 billion in assets under management. OrbiMed invests globally across the spectrum of healthcare companies, from venture capital start-ups to large multinational companies. OrbiMed's team includes over 60 experienced professionals with offices in New York, San Francisco, Shanghai, Mumbai and Herzliya. OrbiMed manages a series of private equity funds, public equity funds, royalty and debt funds, and other investment vehicles. www.orbimed.com
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