Veradigm Inc.’s leaders have beefed up the company’s technological capacities by buying a five-year-old Boston company that uses artificial intelligence to organize and analyze masses of healthcare data.
Chicago-based Veradigm has paid $140 million for large language model company ScienceIO, which is home to about 20 people and has in the past been backed to the tune of more than $8 million by an investor group that includes Section 32 and Sea Lane Ventures. ScienceIO’s technology can be used in patient cohort selection—a potential sweet spot for Veradigm, which has amassed a data set of more than 200 million patients—and patient care plans as well as more administratively with revenue cycle management and insurers’ workflows.
The cash acquisition of ScienceIO includes about $44 million in deferred payments that will be made over the next three years. Veradigm interim CEO Yin Ho and interim CFO Lee Westerfield earlier this year said they were looking at acquisitions that Westerfield said would help “modernize” the company’s product mix.
“We will be able to extract greater and more accurate insights from [Veradigm’s] data set and build an AI center of excellence,” Ho, who also is a Veradigm director, said in a statement announcing the ScienceIO purchase. “We will be able to provide more highly differentiated and advanced products to provider, payer and life sciences customers that ultimately result in higher-quality, lower-cost care for patients.”
Shares of Veradigm (Ticker: MDRX) fell on news of the ScienceIO deal as well as word a day later that the Nasdaq stock market officials had notified Ho and her team that the stock will be delisted as executives continue to fix the fallout from shortcomings in Veradigm’s audit and financial controls functions.
But the stock has since recovered some ground and was changing hands at $7.50 in midday trading March 11. Over the past six months, however, the shares are still down about 40 percent, which has cut Veradigm’s market capitalization to about $800 million.
