Acquisition broadens Ontrak’s addressable market and footprint to lower acuity populations enabling new interventions and remote patient monitoring.
Ontrak, Inc (NASDAQ: OTRK) ("Ontrak" or the "Company"), a leading AI-powered and telehealth-enabled, virtualized healthcare company, today announced that it has acquired LifeDojo Inc, a comprehensive, science-backed behavior change platform.
LifeDojo is a platform that makes transformative life changes possible for members in over 16 countries. Supported by decades of public health research, the LifeDojo approach to member-centric behavior change delivers lasting health improvement outcomes, high enrollment, and better engagement than traditional programs. Clients include Fortune 500 companies and high-tech, high-growth organizations who use LifeDojo’s 32 behavior change modules.
The Journal of the American Medical Association (JAMA) this month reported accumulating evidence of a "second wave" mental health surge that will present monumental challenges for an already greatly strained mental health system and individuals at high risk for mental health disorders such as anxiety, depression, and post-traumatic stress. A June 2020 survey from the Centers for Disease Control and Prevention of 5,412 US adults found that 40.9% of respondents reported "at least one adverse mental or behavioral health condition," including depression, anxiety, posttraumatic stress and substance abuse, with rates that were three to four times the rates one year ago.
With the coronavirus pandemic rapidly increasing demand for "telemental" health solutions, the acquisition of LifeDojo is expected to advance the Ontrak growth strategy in four ways:
First, the acquisition adds a technology-first, digital business deployed by blue chip customers in the employer space.
Second, LifeDojo enhances Ontrak’s market-leading behavioral health engagement capabilities for new and existing customers, with the addition of the LifeDojo digital tools that drive member value and lower cost. The combination of behavioral health coaching and digital app-based solutions meets accelerated payer demand for a comprehensive suite of behavioral health services and solutions.
Third, the LifeDojo platform increases the company’s addressable market by enabling the creation of lower cost, digital interventions across behavioral health and chronic disease populations.
Fourth, LifeDojo’s member-facing apps enable remote patient monitoring capabilities, initially focused on member reported data, that will feed Ontrak AI capabilities and further personalize Ontrak’s evidence-based coaching.
Mr. Terren Peizer, Chairman and CEO of Ontrak, stated, "As a public company and leader in virtualized healthcare, Ontrak is uniquely positioned to attract companies, products and technologies that expand our value proposition and footprint with health plan and employer partners. We will endeavor to make additional strategic purchases that expand our addressable market and maximize customer value. LifeDojo and these other intended acquisitions can possibly expand our total addressable $33.7 billion market by up to 100%."
LifeDojo Co-Founder and CEO Mr. Chris Cutter, added: "We are thrilled to be combining forces with Ontrak. We are proud to have built a trusted platform for some of the most demanding digital health clients and tech companies in the industry. Like Ontrak, we have engagement rates that are many times higher than the industry average and we look forward to delivering a comprehensive ecosystem of health solutions to high and low acuity Ontrak members."
Chris Cutter, Co-Founder and CEO, and Patricia Bedard, Co-Founder and CTO of LifeDojo, have joined the Ontrak leadership team.
About Ontrak, Inc.
Ontrak, Inc. (f/k/a Catasys, Inc.) is a leading AI and telehealth enabled, virtualized healthcare company, whose mission is to help improve the health and save the lives of as many people as possible. The company’s PRE™ (Predict-Recommend-Engage) platform predicts people whose chronic disease will improve with behavior change, recommends effective care pathways that people are willing to follow, and engages people who are not getting the care they need. By combining predictive analytics with human engagement, Ontrak delivers improved member health and validated outcomes and savings to healthcare payers.
The company’s integrated, technology-enabled Ontrak™ programs, a critical component of the PRE platform, are designed to provide healthcare solutions to members with behavioral conditions that cause or exacerbate chronic medical conditions such as diabetes, hypertension, coronary artery disease, COPD, and congestive heart failure, which result in high medical costs.
Ontrak has a unique ability to engage these members, who do not otherwise seek behavioral healthcare, leveraging proprietary enrollment capabilities built on deep insights into the drivers of care avoidance.
Ontrak integrates evidence-based psychosocial and medical interventions delivered either in-person or via telehealth, along with care coaching and in-market Community Care Coordinators who address the social and environmental determinants of health, including loneliness. The company’s programs improve member health and deliver validated cost savings to healthcare payers of more than 50 percent for enrolled members. Ontrak solutions are available to members of leading national and regional health plans in 30 states and in Washington, D.C.
Learn more at www.ontrak-inc.com
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Except for statements of historical fact, the matters discussed in this press release are forward-looking and made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect numerous assumptions and involve a variety of risks and uncertainties, many of which are beyond our control, which may cause actual results to differ materially from stated expectations. These risk factors include, among others, risks that the benefits we may expect from an acquisition may not be realized to the extent or in the time frame we anticipate. We may lose key employees, customers, vendors and other business partners of a company we acquire after announcement of acquisition plans. In addition, an acquisition may involve a number of risks and difficulties, including expansion into new geographic markets and business areas in which our management has limited prior experience, the diversion of management’s attention to the operations and personnel of the acquired company, the integration of the acquired company’s personnel, operations and technology systems and applications, changing relationships with customers, vendors or strategic partners, differing regulatory requirements including in new geographic markets and new business areas, and potential short-term adverse effects on our operating results. These challenges can be magnified as the size of the acquisition increases. Any delays or unexpected costs incurred in connection with the integration of an acquired company or otherwise related to an acquisition could have a material adverse effect on our business, financial condition and results of operations. An acquisition also may require a large one-time charge and can result in increased debt or other contingent liabilities, adverse tax consequences, deferred compensation charges, the recording and later amortization of amounts related to deferred compensation and certain purchased intangible assets, and the refinement or revision of fair value acquisition estimates following the completion of an acquisition, any of which items could negatively impact our business, financial condition and results of operations. In addition, we may record goodwill in connection with an acquisition and incur goodwill impairment charges in the future. Any of these charges could cause the price of our common stock to decline. An acquisition also could absorb substantial cash resources, require us to incur or assume debt obligations, or involve our issuance of additional equity securities. If we issue equity securities in connection with an acquisition, we may dilute our common stock with securities that have an equal or a senior interest in our company. An acquired entity also may be leveraged or dilutive to our earnings per share, or may have unknown liabilities. In addition, the combined entity may have lower than expected revenues or higher expenses and therefore may not achieve the anticipated results. Any of these factors relating to an acquisition could have a material adverse impact on our business, financial condition and results of operations.. You are urged to consider statements that include the words "may," "will," "would," "could," "should," "believes," "estimates," "projects," "potential," "expects," "plan," "anticipates," "intends," "continues," "forecast," "designed," "goal," or the negative of those words or other comparable words to be uncertain and forward-looking. For a further list and description of the risks and uncertainties we face, please refer to our most recent Securities and Exchange Commission filings which are available on its website at http://www.sec.gov. Such forward-looking statements are current only as of the date they are made, and we assume no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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