Friday, January 22, 2016

Practice Fusion Said to Hire JPMorgan Chase to Explore I.P.O. - The New York Times

"SAN FRANCISCO — Practice Fusion, an electronic health records start-up, hired JPMorgan Chase last year to explore an initial public offering in 2017, according to people with knowledge of the matter, though the discussions are now in flux because of market volatility.
At the time, JPMorgan estimated that Practice Fusion could get a public market valuation of around $1.5 billion if it went public next year, according to a document prepared by both companies that was reviewed by The New York Times. The valuation was based on estimated revenue of $181 million for 2018."
Practice Fusion and Ron Howard (founder) and I have known each other since 2005. I was a founder of the Inland Empire Health Information Exchange.  Don Berwick, the initial ONCHIT head mentored me through the startup process of what was then called a Regional Health Information Exchange (RHIO)  We worked in an unknown landscape, more enigmatic than Pluto.  We spent most of our time educating physicians, hospitals and other providers.  Pioneers are never prophets in their own lands. I was greeted with skepticism, and quickly dismissed by most of my peers.
Ryan Howard presented a webinar for our group, which was at the time a seldom used medium for presentations.  Our medical society boardroom had a broadband internet connection and a large projection system.  At the same time we set up a voice conference using our tabletop conference phone.  For the time we were on the cutting edge.  Although we did not purchase Practice Fusion for the HIE the presentation turned heads and was a major factor in promoting our ideas..
The Practice Fusion model was one of the first attainable cloud EMR solutions and had the potential to work as the 'node' for any practice using Practice Fusion, and serve a dual purpose for hosting an EMR in the cloud as well as linking medical practices as a health information exchange.
It also was about the first subscription EMR solution,  breaking the standard client-server hardware configuration.  The advantages were enormous, easier non disruptive updates for all users. Elimination of software maintenance.  Minimal expense for hardware, and a GUI based on browsers (html).  
I would not be suprised if many other health information exchanges have an IPO offering. It suits the public service and would produce the capital outlay for further HIT development.  Federal and state grants are not reliable and often cease after the first two years.  This caused many other HIE's to fail.   The IHIE business model was to be self-sustaining from the first day.  In our region we were fortunate to have two or three 'anchor' users and build upon that base.
Some regions are not so fortunate and an IPO may well serve a purpose in those circumstances.
The outcome of the Practice Fusion IPO may fortell the potential. It will certainly be an excellent exit strategy for Mr Howard.  
The success of failure of an IPO depends upon many other factors, including market timing, other simultaneous IPO offerings and investor knowledge, 

Practice Fusion Said to Hire JPMorgan Chase to Explore I.P.O. - The New York Times

1 comment:

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