Commure and Athelas to Merge to Gain Scale and Drive Efficiency; Consolidation an Increasing Trend in Healthcare IT
Commure, a leading healthcare technology provider, is set to merge with Athelas, a fast-growing provider of healthcare workflow automation software and revenue cycle tools. The merger aims to combine the strengths of both companies, with Athelas’ expertise in healthcare workflow automation and revenue cycle tools complementing Commure’s AI-enabled workflows platform. The merged company will continue to operate under the Commure name and will be led by Athelas co-founder and CEO Tanay Tandon.
Commure was founded in 2017 to establish a common healthcare infrastructure and modernize healthcare technologies globally. Over the past three years, Commure has achieved significant growth, with over 550% growth in Annual Recurring Revenue (ARR) and serving more than 500 health facilities including large names like HCA Healthcare, Boston Children’s Hospital and Jefferson Health. The company is on track to achieve $100 million in contracted annual recurring revenue by January 31, 2024. Commure’s unified platform connects various point solutions in healthcare, making data accessible to clinicians and optimizing the efficiency of healthcare businesses.
Athelas, founded in 2016, specializes in software and sensor products that enhance healthcare workflows, save administrative time, and improve patient outcomes. The company has experienced 450% revenue growth over the last three years and provides AI-powered revenue cycle, remote monitoring, and patient engagement tools.
The merger of Commure and Athelas aims to drive operational efficiency in health systems by offering advanced solutions that streamline processes and enhance patient care. Commure will continue to pursue growth opportunities aligned with its vision of powering advanced health systems.
Ashwini Zenooz, MD, the current CEO of Commure, will transition into a non-executive director role on Commure’s board and serve as a senior advisor to the company. Tanay Tandon, Athelas’ co-founder and CEO, will take over as Commure’s incoming CEO. The merger is expected to close by the end of October 2023, pending customary closing conditions and regulatory approvals. The financial terms of the deal were not disclosed.
There have been concerns of oversaturation of entrants given the number of healthcare IT companies that raised substantial funding over the last few years, especially in the peak of the venture market in 2021. Scale matters in the healthcare IT market, as was seen with the advent of electronic medical records, as hospital systems want to work with sustainable, comprehensive providers. Therefore, consolidation within the industry will likely be a continuously emerging trend especially as access to capital becomes more challenging.