After Strong First Quarter, Validic Raises $12.5 Million Series B

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Durham, NC-based digital health startup Validic announces that it has closed a $12.5 million Series B led by one of its major customers Kaiser Permanente, through its investment arm, Kaiser Permanente Ventures. The round also saw contributions from SJF Ventures and Greycroft Partners. In total, the new funding brings Validic’s total to more than $20 million since its 2010 launch.

Validic is coming off an impressive first quarter as its flagship product, an interface engine that captures and normalizes patient-generated health data, gains traction among health systems and EHR vendors. The company’s product is entering a market with sudden demand and virtually no competition. EHR vendors are scrambling to incorporate patient-generated health data, such as fitness data from activity trackers or, more importantly, clinical metrics such as blood glucose levels from glucometers, into both their patient portal offerings as well as into their clinical applications and population health tools. Demand for patient-generated health data started as health systems began to shift from fee-for-service to value-based reimbursement models. Now that there is an incentive to keeping patients out of secondary care facilities when possible, organizations are looking at ways of monitoring patients’ daily activities and disease states remotely.

While the number of health systems sophisticated enough to be capturing and interpreting patient health data in pursuit of true population health management may be low, the need, and therefore demand, to incorporate patient-generated health data is only going to intensify because preliminary Meaningful Use Stage 3 rules include requirements that mandate this functionality:

“Patient generated health data or data from a non-clinical setting is incorporated into the certified EHR technology for more than 15 percent of unique patients discharged from the eligible hospital or CAH inpatient or emergency department.” – MU3 Proposed Rules

As a result, Validic has signed both MEDITECH and Cerner as new customers, both of which will use Validic’s integration engine to consume patient-generated data into their respective EHRs and patient portals. The company also announced that it has signed a number of health systems, wellness companies, and pharmaceutical companies this quarter. In total, Validic’s integration engine is transferring data for 160 million patients in 47 countries. The company is also expanding its integration engine to connect with more traditional inpatient medical devices so that hospitals will be able to turn to a single vendor for both inpatient and patient-generated health data interfaces.

The company reports that its new funding will be used to scale as it works to meet the markets growing demand.


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