Telehealth provider Doctor On Demand announced plans last week to merge with Grand Rounds to form a new company centered around virtual care. Doctor On Demand provides a full suite of personalized Total Virtual Care services including primary care, integrated behavioral health, everyday and urgent care, chronic condition management, and prevention. The company delivers services through employers, health plans, Medicare Part B, and directly to consumers. Grand Rounds provides care coordination and expert medical opinions, and it helps clients understand and navigate health care insurance benefits.
No terms for the merger were disclosed, but the two companies had a boost in funding from investors last year. In July, Doctor on Demand secured $75 million in Series D financing led by General Atlantic, a leading global growth equity firm. Grand Rounds secured a $175 million round led by investment funds affiliated with global investment firm The Carlyle Group (NASDAQ: CG) back in September to help the company expands its clinical navigation and virtual primary care platform. We expect these funding rounds were driven by a surge in demand of telehealth services due to Covid-19.
The new company will combine Grand Rounds’ data-driven clinical navigation platform and patient advocacy tools with Doctor On Demand’s preeminent virtual care, hoping to help people address the $300 billion problem of uncoordinated care in the U.S. Owen Tripp, CEO of Grand Rounds, will serve as the CEO of the expanded business. The deal is expected to close in the first half of 2021.
According to search results in our Healthcare Deals Database, the demand for virtual care targets in the M&A market has not slumped compared with 2020, where telehealth demand surged. In February, Evernorth, a division of Cigna (NYSE: CI), bought MDLive Inc., which offers convenient, affordable and contagion-free virtual healthcare services to more than 60 million members nationwide. The new Doctor on Demand and Grand Round company has a lot of competition in the space going forward it seems, so the increased size as a result of the merger should give the company an advantage.