LogistiCare, a broker of non-emergency medical transportation services, has entered an agreement to acquire Boston-based Circulation, a NEMT-focused startup.
Through the deal, which is expected to close in the next 30 days, LogistiCare hopes to further its mission of reducing transportation as a barrier to healthcare access.
Together, the entities will seek to offer a platform that makes additional growth possible.
“By integrating and deploying Circulation’s technology platform across the scale of LogistiCare’s nationwide operations, we are targeting synergies in excess of $25 million on a run-rate basis within the first 24 months, while also meaningfully upgrading the entire experience for our customers and their members/patients,” LogistiCare CEO and Circulation director Jeff Felton said in a statement.
LogistiCare is a subsidiary of The Providence Service Corporation, which made an investment in Circulation last year. Put simply, LogistiCare assists state governments and managed care organizations in running transportation and integrated care programs.
On the other hand, Circulation works with health systems and payers to provide on-demand ride options for patients to get to and from appointments. Through the startup’s approach, a variety of parties — such as call centers, caregivers, patients and others — can schedule rides. The company was founded in 2016.
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.
“Combining with LogistiCare allows us to accelerate our impact on the healthcare ecosystem,” Circulation co-founder and CEO Robin Heffernan noted in a statement.
Last summer, the Boston startup announced a $10.5 million Series A round co-led by The Providence Service Corporation and Flare Capital Partners. Other participants included Boston Children’s Hospital, Humana, Echo Health Ventures, NextGen Venture Partners and Intermountain Healthcare Innovation Fund. It planned to use the capital to expand across the country and hire talent for product development.
In December, the company inked an agreement with Lyft for NEMT services. The deal gave Lyft access to Circulation’s clients, and Circulation users gained the ability to schedule Lyft rides directly through Circulation’s HIPAA-compliant platform.
LogistiCare’s acquisition of the Boston company comes as the NEMT space is hot with activity. In addition to traditional rideshare companies like Lyft and Uber making moves, organizations like Veyo and Roundtrip have done their own work. Even automaker Ford Motor Company launched its own non-emergency medical transportation service.
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