Monday’s auction for the assets and intellectual property of bankrupt telehealth company HealthSpot didn’t last long, nor was it “frothy,” as the bankruptcy trustee had predicted.
Pharmacy chain Rite Aid won with its initial $1.15 million bid after a local investment group declined to raise its “stalking horse” bid of $1 million from last week, according to Columbus Business First. A potential third bidder dropped out last week.
That price is a bargain compared to the $5.2 million valuation Dublin, Ohio-based HealthSpot placed on its assets and IP when the Columbus, Ohio, bankruptcy court accepted its liquidation plan in March. HealthSpot said that $3.5 million of those assets were in the form of 191 telemedicine kiosks, just 54 of which had ever been deployed.
Rite Aid was HealthSpot’s biggest customer. The chain, which is being acquired by Walgreens, had telemedicine kiosks in 25 stores in three Ohio markets before HealthSpot abruptly ceased operations at the end of 2015.
Camp Hill, Pennsylvania-based Rite Aid didn’t have a whole lot to say. “We are happy to obtain the assets as we very much believe in telehealth as a healthcare solution,” company spokeswoman Ashley Flower told MedCity News in an email. She did not elaborate.
Unknown is whether Rite Aid or Walgreens has a plan to make the pricey kiosks more cost-effective, or if the winning bidder simply was interested in building on HealthSpot’s technology.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
HealthSpot raised about $48 million in venture capital in its four years in business, but only generated $1.1 million in sales during three years of telehealth operations. The company reported liabilities of $23.3 million.
Photo: HealthSpot
