Teladoc to Buy InTouch for $600 Million in Telemedicine Bet

(Bloomberg) -- Teladoc Health Inc. agreed to buy closely held rival InTouch Health for $600 million in cash and stock, betting that demand will increase for digital medical consultations, or telemedicine.

The deal will expand Purchase, New York-based Teladoc’s reach into more specialized virtual discussions between physicians at a hospital or health system, facilitating consultations as well as care in areas that lack specialists like neurologists or neuronatologists to treat strokes or sick babies.

“Our vision is to be there, providing virtual care solutions at every front door of the health-care system, and this really helps to take a giant step forward,” said Teladoc Chief Executive Officer Jason Gorevic.

Read: Bloomberg Intelligence’s take on online medical consultations

Virtual medical consultations, such as those provided by Teladoc, allow patients to see doctors without having to travel or endure long waits. As a result, they’re regarded as a way to improve patient access to care while reducing costs, though the area has proven slow to take off among patients.

Even so, hospitals have increasingly embraced the trend in recent years, and Gorevic said the InTouch acquisition reflects that shift.

InTouch works with well-known names like HCA Healthcare Inc., the Mayo Clinic and Kaiser Permanente, with 3,600 care locations and nearly 15,000 doctors using its platform. It brought in roughly $80 million in 2019 revenue, according to early financial results.

The deal consists of $150 million in cash and the remaining $450 million in Teladoc stock. It is expected to close in the second quarter.

To contact the reporter on this story: Emma Court in New York at ecourt1@bloomberg.net

To contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, James Ludden

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