LATEST UPDATES:
- MAY 2, 2014 - Summit Partners releases press release stating that Summit Partners will Acquire MDVIP — CEO Dan Hecht of MDVIP says “Summit Partners shares my vision for MDVIP – to continue growing as a national leader in primary care.”
- APRIL 25, 2014 - According to The WSJ, Bloomberg Businessweek, LBO Wire and investment news watch site, SeekingAlpha.com, Piper Jaffray is out shopping MDVIP to interested parties. The WSJ story writes that GTCR of Chicago has been actively bidding for health-care assets recently. LBO Wire has reported that the firm is in the final round of the sale process for Procter & Gamble Co.’s personalized health-care unit, MDVIP. Insiders say a P-E firm will be the most likely buyer. (Source: WSJ, April 25, 2014; SeekingAlpha.com & Bloomberg Businessweek) — The Editors here at Concierge Medicine Today (CMT) have been regularly connecting with sources at MDVIP and no further information is available at this time. MDVIP has a national network of physicians and practices that extends to 700 physicians in 42 states with a membership price of $1.5K per year.[1 - Source: Bloomberg Businessweek] Please stay up-to-date on the LATEST news at ConciergeMedicineToday.com
- APRIL 24, 2014 – GTCR, of Chicago, has been actively bidding for health-care assets lately writes Amy Or and Shasha Dai in the WSJ in late April 2014. LBO Wire, citing a person familiar with the situation, reported last week the firm is in the final round of the sale process for Procter & Gamble Co.’s personalized health-care unit, MDVIP. (Source: By Amy Or and Shasha Dai, WSJ, April 24, 2014)
- MAR. 5, 2014 - Concierge Medicine Today (CMT) has learned that insiders say a P-E firm will be the most likely buyer. The Procter & Gamble Company (NYSE:PG) (P&G) is known to be looking at divesting its MDVIP concierge business unit. Last week the company reaffirmed that it would exit ventures that won’t help it grow. The Wall Street Journal reported citing unnamed sources that P&G has retained Piper Jaffray & Co. as its adviser on the sale. (Source: SeekingAlpha.com & Bloomberg Businessweek)
- FEB. 25, 2014 - Concierge Medicine Today (CMT) has learned that Procter & Gamble Co. (NYSE: PG) has hired Piper Jaffray & Co. to find a buyer for MDVIP, a Boca Raton, Fla.-based provider of personalized healthcare services for the wealthy, according to Dow Jones.
- FEB. 24, 2014 - Concierge Medicine Today (CMT) has learned that earlier in February 2014, Procter & Gamble Co. was rumored to be seeking a buyer for its MDVIP Inc unit, a Boca Raton-based provider of medical and health services, according to sources at TheMiddleMarket.com.
NOTE: Concierge Medicine Today (CMT) is attempting to reach out to several physicians, industry business resources, and others, including MDVIP leadership, for comment and will continue to follow this developing story and apprise you of any comments, statements and/or developments. Thank you for reading Concierge Medicine Today (www.ConciergeMedicineTODAY.COM)
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By Amy Or, The Wall Street Journal
P&G bought a minority stake in MDVIP in January 2007 and acquired full ownership in 2009. The terms of the transaction weren’t disclosed then. P&G said at the time of the investment that the proactive approach leads to lower hospitalization rates and significant cost savings to patients, employers and the health-care system as a whole.
Feb. 24, 2014, 9:41 a.m. EST - Procter & Gamble PG +0.51% Co. is seeking to sell MDVIP, a personalized health-care operator catering to the wealthy, in what would be the latest divestment by a consumer goods and health-care company, people familiar with the situation said.
P&G has mandated investment bank Piper Jaffray PJC +1.15% & Co. as its adviser on the sale, one person said.
Corporate makers of health-care products that have aggressively expanded over the past few years are getting a reality check on their various business units, as they seek to cut costs and enhance efficiency amid slow global economic growth. A few have started to cut ties with operations that aren’t star performers.
Peer Johnson & Johnson JNJ +0.13% last month sold its blood-testing unit, Ortho-Clinical Diagnostics, to Washington, D.C., private-equity firm Carlyle Group in a $4.15 billion deal as part of its plan to shed slow-growing products and businesses.
Boston-based buyout shop Thomas H. Lee also bought online contacts lens company 1-800 Contacts Inc. from U.S. health insurer WellPoint WLP +2.51% Inc. last month. WellPoint, which bought the Draper, Utah-based contact lens retailer for close to $900 million just 18 months ago, said it would record an impairment charge of $153 million to $168 million as a result of the divestment.
Just Released! On Sale Now $9.95
Potential buyers for P&G’s MDVIP unit would likely be private-equity firms, a person familiar with the situation said, as the business may not be a good fit with health-care operators, which either aren’t interested in such a niche segment of the market or find it hard to grow a network of independent doctors willing to focus on a smaller number of patients.
Boca Raton, Fla.-based MDVIP is what is often referred to as a “concierge health-care operator.” It offers personalized health care to the wealthy at a time when insurance reimbursements have squeezed primary-care doctors to take on a large number of patients.
P&G said MDVIP‘s network of 700 MDVIP-affiliated physicians—which span 42 states and the District of Columbia—each care for 600 patients or fewer, much lower than the average of more than 2,000 patients among traditional primary care practitioners. It added that the doctors also provide preventive, personalized health-care to patients, not just the detection and treatment of disease. MDVIP—founded in 2000—currently serves more than 215,000 patients, up from 50,000 when P&G first invested in MDVIP in 2007, the consumer goods giant said.
The memberships don’t come cheap. MDVIP said on its website memberships start at $1,500 a year.
The person familiar with the situation said MDVIP posted $16 million in earnings before interest, taxes, depreciation and amortization last year.
P&G declined to comment on the sale process, noting only that “MDVIP is highly valuable, rapidly growing, and the undisputed leader in personalized and preventive health care.”
At this point, it is unclear how the health-care overhaul passed in 2010, which began its rollout last year, could affect demand for personalized physician-care networks such as MDVIP, which charge anywhere from $100 a month to $25,000 a year for services not covered by insurance companies.
While insurance costs are likely to increase, squeezing household spending for additional health-care services such as concierge medicine, consumers may look to take better care of their health to prevent punitive measures that employers could impose for various conditions such as high blood pressure and thick waistlines. Concierge health-care providers, which pride themselves on knowing their patients so well they can detect medical conditions early on, hope to meet that need.
Trade publication, Concierge Medicine Today tells The Wall Street Journal in November of 2013 that it estimates there to be approximately 5,500 doctors in the U.S. now run such boutique practices, charging an average $135 a month for such services.
P&G bought a minority stake in MDVIP in January 2007 and acquired full ownership in 2009. The terms of the transaction weren’t disclosed then. P&G said at the time of the investment that the proactive approach leads to lower hospitalization rates and significant cost savings to patients, employers and the health-care system as a whole.
Sources:
- http://www.marketwatch.com/story/pg-seeks-to-sell-health-care-operator-2014-02-24-94494120
- http://online.wsj.com/news/articles/SB10001424052702303426304579402841866668148
