Reuters: Change Healthcare retains investment banks for future IPO
- Change Healthcare has reportedly hired a team of underwriters to lead an initial public offering, potentially signaling the end of the two-year IPO drought in the digital health space.
- Citing sources familiar with the matter, Reuters identified the IPO underwriters as Goldman Sachs Group, Barclays and J. P. Morgan Chase. McKesson, Change Healthcare and Goldman Sachs did not respond to Healthcare Dive's requests for comment on the potential IPO preparation. Barclays and J.P. Morgan declined to comment.
- The IPO could be valued as high as $12 billion, according to the report. A recent regulatory filing by McKesson Corp., which has a majority stake in Change, shows $856 million in revenue for the revenue cycle management and analytics outfit during the three months ended June 30.
While details are scarce, sources told Reuters a Change IPO is expected in the first half of next year. That timeline would mesh with what McKesson CEO John Hammergren told investors at J. P. Morgan's healthcare conference in January.
Created as a 70%-30% joint venture between McKesson and RCM firm Change Healthcare in 2017, the Nashville-based Change has been busy adding products and services and lining up partnerships.
Last fall, the company teamed up with Google Cloud to develop imaging solutions for healthcare providers. It also introduced an enterprise-scale blockchain technology for RCM in hospitals and health systems. That was followed by January's rollout of Intelligent Health Network.
Then in May, Change partnered with Microsoft and Adobe to develop a tool to help providers understand how their patients like to engage, such as email or a patient portal.
And just last month, Change announced the availability of Intelligent Health Network on Amazon Web Services. The service will allow hospitals and insurers to track the status of patient billings from submission to payment in real time.
If Change were to go public, it would be the first digital health IPO since 2016. On Oct. 20, 2016, continuous cardiac monitoring platform iRhythm Technologies raised $107 million in an initial public offering on the NASDAQ stock exchange under the ticker symbol IRTC.