Membership-based primary care company One Medical filed for an IPO. The company allows patients to book appointments and communicate with their providers online.
Primary Care startup One Medical made its public debut on Friday, raising $245 million in its IPO. The company’s stock began trading on Nasdaq as ONEM, priced at $14 per share, on the lower side of its initial $14 to $16 guidance.
Parent company 1Life Healthcare offered 17.5 million shares for its IPO, with an option for underwriters to buy an additional 2.62 million shares of stock in the next month. By Friday afternoon, One Medical’s shares had already jumped to $21.
“Today we mark a milestone on One Medical’s journey to transform health care with our public listing on Nasdaq,” One Medical CEO Amir Dan Rubin wrote in a blog post. “Publicly raising funds will allow us to widen our reach and impact. It also creates an opportunity for a broader group of investors to participate in our vision to delight millions of members with better health and better care, while lowering costs.”
In 2018, One Medical raised $350 million from private equity investor the Carlyle Group, valuing the company above $1 billion. In total, One Medical had raised more than $530 million as a private company, with investors including Alphabet’s GV, Benchmark, J.P. Morgan Asset Management and Redmile Group.
The San Francisco-based startup essentially offers concierge primary care services, but at a more modest price. One Medical offers its services at about $200 per year, giving patients access to its offices in most major metros, from Los Angeles to Boston. The company has also been focused on building out its corporate customer base; it currently serves 6,000 employers, Rubin wrote.
The company also has a tech component: it built its own health record and practice management system, as well as a front-facing app that lets patients book appointments and contact their provider.
One Medical had a total of 422,000 members at the end of December, a 22 percent increase from last year, according to an amended prospectus. The company brought in a total of $227.4 million in revenue, up 30 percent from 2018. It also added six new offices in early 2019.
However, the company also saw its costs grow as it continued its rapid expansion. One Medical reported a net loss of $52.45 million, an increase from its $45 million net loss last year. The company’s cost of care increased to $168.6 million, though it represented a slightly smaller chunk of One Medical’s overall revenue, at 61 percent.
One Medical chalked up the costs to the new offices, and salaries and benefits as it grew its workforce and prepared for the IPO.
J.P. Morgan and Morgan Stanley served as the lead underwriters for the deal. One Medical’s offering is expected to close on February 4.
Photo credit: One Medical
