Healthcare IT sector gets USD 858 mn VC funding in Q1: Mercom

New Delhi: Venture capital funding in the healthcare information technology (IT) sector continued at a record pace, with USD 858 million raised in 163 deals in the first quarter of 2014, says a report.

According to global communications and consulting firm Mercom Capital Group, VC funding in the sector increased 154 per cent from USD 337 million raised in Q4 of 2013. This was the highest dollar amount raised by the sector in a single quarter to date, Mercom Capital Group said. "Funding into the healthcare IT sector continues at an astonishing pace. Venture capital funding in healthcare IT has reached almost USD 5 billion in about 1,000 deals since 2010," said Raj Prabhu, CEO and Co-Founder of Mercom Capital Group.

The top VC funding deal in Q1 2014 was USD 89 million raised by the Dedalus Group, a healthcare IT systems company. Healthcare practice-focused technology companies received half of all the VC investments in the first quarter of 2014, with USD 460 million in 60 deals. Besides, mergers and acquisitions in the healthcare IT sector was at its highest level, totalling 53 transactions, compared with 44 transactions in Q4 of 2013.

Two healthcare IT IPOs in the first quarter raised a combined USD 304 million, it said. Castlight Health, a provider of healthcare transparency solutions, brought in USD 204 million through its IPO in March and Everyday Health, a digital health and wellness solutions provider, launched an IPO that raised USD 100 million. Total corporate funding in the healthcare IT sector, including VC, accelerator, incubator, debt and public market financing in the first quarter came in at USD 1.2 billion. Mercom Capital Group is focused on healthcare IT, cleantech and financial communications.