As investors wait and see which way the digital health barometer will go with Castlight Health’s initial public offering, the medical price transparency company filed an amended filing with the Securities and Exchange Commission for its IPO registration. It now calls for the sale of 11,100,000 priced from $9 to $11 per share. The inclusion of registration fees pushes it up to $140 million.
The company is about increasing price transparency in healthcare. It offers its service to employer health plans with the idea that consumers will opt for less expensive medical procedures if they can see that the quality does not suffer with a lower price. The company makes the case that misaligned economic incentives have meant that employees have been insulated from direct financial responsibility for healthcare costs. Employees paid about one-quarter of healthcare costs with employers on the hook for the rest in 2012, according to a joint survey by NBGH and Towers Watson cited by Castlight Health.
Investors have expressed surprise at the company’s lackluster sales performance and that Walmart accounts for 13 percent of its revenues. Although Castlight revenues rose from $1.9 million in 2011 to $13 million in 2013, it has operated at a loss each year, with net losses totaling $62.2 million last year. On the plus side, it has a backlog of customer agreements valued at $108.7 million as of December 31, 2013.
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