Dive Brief:
- ResMed has closed its €958.6 million ($997.5 million) takeover of home health software provider Medifox Dan.
- The takeover, ResMed’s first investment in a software-as-a-service business in Europe, gives the company control of a 700-person operation that offers similar solutions to its existing U.S. brands MatrixCare and Brightree.
- Germany-based Medifox supports out-of-hospital providers with care documentation, personnel planning, administration and billing, and has slotted into ResMed’s SaaS business segment.
Dive Insight:
Talking to investors on a conference call in August, ResMed CEO Michael Farrell called Medifox “the leading provider of end-to-end software solutions for home health and for nursing home providers in Germany” and outlined the thinking behind the deal.
“We've been closely watching the evolution of the German digital health system and the associated outside-hospital health care system for many years. And we've actually been closely watching Medifox Dan for a number of years. This is our first investment in a pure-play SaaS business in Europe, and it's a great opportunity to expand our reach in this business globally,” Farrell said.
ResMed picked Germany as the starting point for its global SaaS expansion because its core sleep and respiratory care business is vertically integrated in the country, and because it is a large market in which the government is investing in digital health reimbursement.
The SaaS business is currently growing in the high single digits, with sales increasing 9% in the most recent quarter, and ResMed sees opportunities to innovate and grow in lower-cost, lower-acuity care settings. ResMed expects the business to maintain high single-digit growth throughout fiscal year 2023.
ResMed is expanding its SaaS business while racing to capture the device sales put in play by the woes of its chief competitor Philips. Sales across the business grew 5% year over year to $950.3 million in ResMed’s most recent financial results.
