The deal, a combination of stock and cash, will beef up Accolade’s platform that helps employees of its customers understand their health plans and benefits.
“Both companies have built deep relationships with employers and health plans by helping employees navigate the increasingly complex and inconsistent healthcare system,” Accolade CEO Raj Singh said in a statement. “With the addition of 2nd.MD, we’ll nearly double our total addressable market while providing the most comprehensive, integrated healthcare navigation experience available.”
Shares of Accolade were up more than 10% in after-hours trading Thursday.
Accolade will integrate 2nd.MD into its platform, offering users a way to get another opinion when facing high-cost and complex medical decisions. Some studies show that getting a second opinion can lead to completely new diagnoses.
2nd.MD says it can provide advice within three to five days, versus the industry average of several weeks. It will continue to be offered as a standalone service. The company, founded in 2011, analyzes medical records and has more than 900 medical specialists that cover various adult and pediatric specialty conditions. It has more than 300 employers as customers, in addition to health plans, and reported about $35 million in revenue last year.
Interest in virtual healthcare is on the rise amid the pandemic as people look for medical advice without going to a physical doctor’s office. Global VC funding to digital health companies reached a record $10.3 billion through the first nine months of 2020, up 43% year-over-year, according to Mercom Capital Group.
Accolade, which went public in July, report