- Google is investing $100 million in Amwell, one of the biggest telehealth companies in the country, in a concurrent private placement with Amwell's initial public offering, the two companies announced Monday.
- As part of the multiyear partnership, Amwell will become Google Cloud's preferred telehealth platform and Amwell will migrate its video capabilities over to Google Cloud.
- The deal comes scant weeks after virtual care giant Teladoc announced it was acquiring chronic care condition manager Livongo for $18.5 billion in the largest digital health deal to date.
The pandemic has exponentially accelerated telehealth adoption in the U.S., and many digital health companies are pursuing big deals as a result, emboldened by surging demand and investor interest. Teladoc's massive snap-up of Livongo is one notable example. Though some analysts and shareholders were uncertain on the deal due to the hefty price tag and COVID-19 uncertainty, its size does hint at the potential of the growing virtual care market.
Amwell is now elbowing deeper into the action. Google's $100 million investment will help the 14-year-old vendor scale its footprint in virtual care and foray deeper in existing markets while pursuing opportunities in new ones. Amwell already counts some 2,000 hospitals and 55 health plans as clients, with more than 36,000 employers, giving it access to some 80 million covered lives.
Google seems a fitting partner for Amwell, given the tech giant's ongoing interest in healthcare, deep pockets and extensive client list. The two companies say they aim to combine their respective technologies and backgrounds for multiple use cases, such as streamlining the telehealth experience by automating waiting room intake and billing processes, translating languages in real-time, offering data analytics for population health and digitalizing routine tasks for payers and providers.
As part of the deal, Amwell will migrate parts of its business to Google Cloud from Amazon Web Services, which it currently uses. Payers and providers have been shifting to the cloud in droves from on-site hosting, sparking massive partnerships between tech firms and traditional healthcare companies looking to leverage more up-to-date technology in their operations. Google Cloud's existing healthcare clients include health systems like Mayo Clinic, Cleveland Clinic, Ascension and Kaiser Permanente, along with telehealth vendor Doctor on Demand.
Teladoc is on Microsoft's Azure cloud platform.
Amwell has seen a massive increase in volume amid COVID-19, CEO Roy Schoenberg told Healthcare Dive earlier this year, going up 4,000% in some cases. In May, Amwell raised almost $200 million in funding on the demand, bringing its total pot to $711 million across eight rounds.
In its IPO paperwork filed with the SEC on Monday, Amwell disclosed it has run more than 2.9 million telehealth visits in the first six months of 2020. That's more than half the total 5.6 million visits Amwell has conducted since inception.
The number of shares and the price range for the proposed offering have yet to be determined. But in its filing, Amwell said revenue had jumped 77% in the first half of 2020 on a year-over-year basis, from $69 million to $122 million. However, the Boston-based company's net loss nearly tripled over the same period, from $42 million in the first half of 2019 to $113 million this year.
Amwell has applied to list its common stock on the New York Stock Exchange under the ticker symbol AMWL.