Telehealth market for women draws Well Health into $51m deal

hamed shahbazi
Well Health CEO Hamed Shahbazi | Photo: Chuck Chiang, BIV

While Canadians still can’t drive into the U.S., that’s not stopping one Vancouver telehealth provider from heading south of the border.

Well Health Technologies Corp. (TSX:WELL) revealed Thursday it’s acquiring a majority stake (53%) of San Francisco-based Wisp Inc. in a deal worth up to $51 million.

Wisp specializes in telehealth services for primary care and prescription medications geared towards women.

The company got its start offering what it describes as discreet treatments for herpes and has since branched out into offering access to treatments for yeast infections and urinary tract infections, among others.

“We are very pleased to report that this proposed transaction is expected to position Well as an emerging provider of women’s health services in the United States and that we plan to leverage the impactful success and know-how of the Wisp operations in the U.S. to launch similar services in other countries, starting with Canada,” Hamed Shahbazi, Well’s CEO and chairman, said in a statement.

The initial part of the deal comes in the form of a mix of cash (about $35 million) and stocks (about $8 million).

The remainder of the $51 million is dependent on Wisp maintaining its revenue performance for multiple years after the close of the deal, which is expected to be completed before the end of 2021.

Wisp’s annualized revenue run-rate currently sits at US$30 million — growth of about 100% year over year. Since its founding in 2018, the company has served about 200,000 patients.

The Wisp deal is just the latest in an ongoing acquisition spree for Well.

Shahbazi told BIV in May that his company has made 20-plus acquisitions over the past few years with the intent of offering services to medical practitioners typically accustomed to navigating a fragmented market for digital technologies within health care.

Since the pandemic, the company’s shares have more than doubled as practitioners have been forced to rapidly accelerate their adoption of digital technologies in medical clinics.

It’s last monster acquisition came in June, when Well acquired Toronto-based electronic medical records provider MyHealth Partners Inc. in a $206-million cash-and-stock deal. 

Shahbazi said his company has been able to capitalize on the medical industry’s lack of digitization as many practitioners still rely heavily on physical paperwork.

“As new doctors float in as Millennials, when we talk to them we could just sort of hear the frustration in their voices about how it's crazy that there isn't more digitization in the marketplace,” Shahbazi told BIV this past spring.

“Then the pandemic hit, of course, and it was a multi-year kind of accelerator that was quite dramatic.”

Note: External representatives from Well Health provided BIV with a press release on an embargoed basis on Wednesday (September 1) — to be issued early Thursday morning (September 2) — that had not been fact-checked. The story first published on Thursday was based on inaccurate information provided to BIV. Following a new press release distributed about seven hours after the story was first published, the story has been updated to reflect the acquisition deal is worth about $51 million, not $50 million; the revenue run-rate stands at US$30 million, not US$28 million; the stock portion of the deal accounts for about $8 million, not $6 million; and Wisp has served 200,000 patients, not 355,000 patients. BIV regrets publishing the inaccurate information provided to it.