Mercom Capital Group Reports Funding and Merger and Acquisition Activity on Healthcare IT for First Quarter 2011

VC funding in the healthcare IT sector in Q1 2011 was up with $35 million raised in seven deals compared to $11 million in five deals in the previous quarter. VC funding for the same quarter last year came to $45 million in five deals.

The top five VC funding rounds included an $11.8 million raise by lifeIMAGE, $10.8 million by Doximity, $4.5 million by Telcare, $3.25 million by Ingenious Med and $2.4 million by HealthTap. In terms of technology, Health Information Management companies accounted for three funding rounds; Personal Health Record and Mobile Health companies received two rounds each. Fourteen different VC investors participated in healthcare IT funding rounds.

M&A activity slowed down in the healthcare IT sector in Q1 2011 amounting to $306 million in 14 transactions compared to $860 million in 30 deals during Q4 of 2010. M&A activity in the same quarter of last year came to $618 million in 27 deals.

Major M&A transactions included the acquisition of Carefx by Harris Corporation for $155 million, System C by McKesson for $142 million, LifeBeyond by Acropetal Technologies for $5 million and Optech Consulting, also by Acropetal Technologies for $5 million.

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