Dive Brief:
- Florida-based MEDNAX is set to acquire one of the largest telemedicine companies in the U.S., Virtual Radiologic Corporation, for $500 million.
- Virtual Radiologic has an annual revenue of $185 million with a network of more than 350 radiologists and reads and interprets more than 5 million diagnostic imaging studies each year.
- This is MEDNAX's fourth acquisition this year, and will serve as a platform for its growth in tele-radiology and telemedicine. "Radiology is a large, fragmented industry with a total revenue of roughly $18 billion, and it is evolving rapidly to include teleradiology as an economic and clinical necessity for customers," said MEDNAX CEO Roger Medel.
Dive Insight:
Despite regulatory barriers that telemedicine faces in some states as physicians struggle to determine what constitutes an appropriate doctor-patient relationship, the market shows no signs of slowing. An IHS report predicted market growth to top $1.9 billion by 2018 from $240 million in 2014, and although Texas recently limited telemedicine services, Peter Kilbridge, a senior research director at the Advisory Board and a telemedicine expert, said that "telemedicine is going to be seamlessly integrated into care. It's going to be woven into the fabric of healthcare in such a fashion that nobody even thinks of it as being separate. It's just going to be one way that we do business."
The acquisition is expected to close in Q2.