Health IT, Startups, Startups

Private equity firm 37celsius co-founder talks about its connected health priorities

The company expects to add strategic investors in the second quarter and will use a $300 million fund to provide complete solutions to payers, providers and pharma companies spanning remote monitoring, care management and population health.

Kempe NewThis post has been updated from an earlier version.

The co-founder of a private equity firm looking for connected health companies with revenues of $5 million to $50 million to invest in and scale said he views these businesses as essential for the progression of healthcare reform not just in North America but in Europe and the Middle East as well. In an interview with Alexander Kempe, a Swedish national with a soft accent who is one-third of 37Celsius’ management team, he talked about its strategy.

Its Milwaukee location speaks to the shifting assumptions about where healthcare companies are sprouting. Wisconsin has a formidable startup community, especially in Madison where electronic medical record giant Epic Systems calls home and former employees have started new businesses.

Connected health is a priority because so much of transforming healthcare will depend on it. Reducing re-admissions requires providers and patients to have ways to follow up with each other that not only fits into the workflows of hospitals but also is intuitive to patients. If patients are expected to improve the way they manage their chronic condition to lower healthcare costs, then they have to be given access to technology that they’ll find useful, affordable and fits into their lives easily. If physicians are expected to identify a patient’s deteriorating condition in the early stages, they need to have a way of receiving that data and checking it that keeps clicks to a minimum, isn’t time consuming and makes that task easy.

“Providers, payers, and pharma companies are overwhelmed with a fragmented connected health market which is unable to deliver complete solutions that are scaleable, while being forced to address more pressing issues such as moving from fee for service to meaningful use, large consolidations and extracting ROI from the next pill. We fulfill a function to help these strategic players in acting on their behalf moving the market to the next stage and giving them access,” Kempe said.

Among the segments that get the firm’s attention are:

  • remote patient monitoring and diagnosis;
  • medication adherence and patient engagement;
  • remote data, IT integration and management;
  • care coordination;
  • telemedicine and telehealth;
  • clinical workflow and process re-engineering.

The company expects to add strategic investors in the second quarter and do its first close for its $300 million fund this year. It will start investing while it continues to raise the rest.

Prior to 37 Celsius, Kempe worked at GE Healthcare for 16 years and held a number of leadership roles in operations and finance, including director of strategic alliance and vice president for home health. He was also CFO at GE Healthcare for Europe, Middle East and Africa.

Kempe also helped set up telehealth company Care Innovations in 2010. The joint venture between GE and Intel develops smart sensor technology to support care givers, remote monitoring for patients, and fall risk assessment by assessing gait patterns and works with healthcare providers.

37 celsius image 1

It has built a team that draws from healthcare IT, pharma and health systems. It has also formed relationships with providers in North America and the European Union. It plans to identify and work with suitable companies around the globe.

“In Asia and the Middle East they like our value proposition. The need in those countries [to manage healthcare access] has become much more pressing in areas such as diabetes. The healthcare community in those regions is interested in applying connected health to improve the quality of care and accelerate access to healthcare,” Kempe said.

“We can’t afford not to be connected to the patient or to be part of the ecosystem in an integrated way, which we haven’t before.”

Kempe’s responsibilities at 37Celsius entail business expansion and integration of portfolio companies.

Its board has some recognizable names in the world of healthcare. Tommy Thompson, a former secretary of Health and Human Services and a four-term governor of Wisconsin; Dr. David Albert, the founder and chief medical officer for AliveCor and who at one stage worked as Chief Scientist for GE Cardiology; David Ataide, the CEO of DRA Medical Advisors; and Chris Wasden, the executive director of the Sorenson Center at the University of Utah.

 

 

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