Healthcare Software Provider Phreesia Preps for $125 Million IPO

This Monday, healthcare software provider Phreesia announced the terms for its upcoming IPO. The New York-based patient-intake healthcare software platform provider aims to raise $125 million through offering 7.8 million share (15 percent secondary) at a range of $15 to $17. Assuming the midpoint of the proposed price range, Phreesia’s implied market value will stand at $658 million.

Founded in 2005, Phreesia has developed a patient-intake management platform that allows healthcare providers to automate the patient check-in process. According to the company’s SEC filing, Phreesia aims to develop and bring to market healthcare solutions that boost efficiency, lower costs and increase clinical effectiveness.

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In its preliminary prospectus filed with the SEC in late June, Phreesia stated that it assisted with over 54 million patient bookings for about 50,000 individual healthcare practitioners across 1,600 healthcare organizations nationwide in fiscal year 2019. The firm’s platform also processed over $1.4 billion in patient payments in the same time frame.

Phreesia’s SEC filing also revealed the company’s strong financial growth over the past two fiscal years. The firm generated nearly $100 million in revenue in the last fiscal year, a growth of almost 25 percent year-over-year. Adjusted EBITDA also increased in the same time period, from a $4.1 million loss in fiscal 2018 to income of $3.5 million in the last fiscal year.

The company estimates that the size of the current market for its platform is around $7 billion, predicated on the possible subscription-based revenue that can be generated from approximately 900,000 U.S. ambulatory care providers.

In 2014, Phreesia raised $30 million in funding in a financing round led by private equity firm LLR Partners. A second funding round in late 2017 led by Echo Health Venture raised an additional $34 million. Both HLM Venture Partners and Polaris Venture Partners have also provided funding for Phreesia.

J.P. Morgan, Wells Fargo Securities, William Blair, Allen & Company and Piper Jaffray are jointly underwriting the deal, which is expected to price during the week of July 15. Phreesia plans to list on the NYSE under the ticker PHR.