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Heads of Commure, Augmedix share details about new acquisition
The health-care sector can't get enough of AI documentation tools. Just ask the chief executives of Commure and Augmedix.
Commure offers a suite of solutions, including an AI scribe and a revenue cycle service, designed to help lessen clinicians' administrative workloads. The company was co-founded in 2017 by Hemant Taneja, the CEO and managing director of the venture capital firm General Catalyst.
Earlier this month, Commure revealed a new addition to its portfolio: it's acquiring a separate AI scribing company called Augmedix.
Augmedix, founded in 2012, was one of the first companies to introduce AI-powered ambient medical documentation to hospitals and health systems. These tools help doctors save time by recording their conversations with patients and automatically turning them into clinical notes and summaries using AI. Augmedix specializes in deploying the technology in settings like emergency departments.
On July 19, Commure agreed to take Augmedix private in an all-cash deal. Commure will purchase all of Augmedix's outstanding common stock at a total equity value of about $139 million, according to a release. Augmedix shareholders will receive $2.35 per share. The company's board unanimously approved the deal, the release said.
CNBC caught up with Commure CEO Tanay Tandon and Augmedix CEO Manny Krakaris on Monday to learn a little more about the acquisition and what it means for both organizations.
Tandon said the two companies initially met to talk about partnership opportunities since they both are vendors for HCA Healthcare, one of the largest health systems in the U.S. But as discussions got underway, he said they realized the organizations could come together in a more comprehensive manner.
Commure already has an ambient documentation tool, but it specializes in ambulatory and outpatient settings, while Augmedix's offering specializes in acute care settings. The companies decided to bring the tools together to minimize the friction that can come from documenting separate pieces of a patient's care.
"You have to have documentation that covers the entire journey. It doesn't just stop when they leave the [emergency department], and then restart again when they're admitted into the hospital as an inpatient," Krakaris said."Today, there's a whole massive, labor intensive step to try to bridge those two worlds."
Tandon said there's a lot of noise in the AI scribe market, and he expects there will be segmentation between high-level scribes that automate simple tasks and enterprise-grade scribes that integrate more deeply with electronic health records and revenue cycles.
Commure is interested in building the latter, and Krakaris said the real value of the Augmedix acquisition will come from bringing the tools together and blending the back-end technologies under one platform.
"It's kind of beneath the surface, it's kind of like an iceberg, but that's where the value creation is," he said. "It's not something that's very visible from the application itself."
In the short term, Commure and Augmedix are working through the relevant approvals and finalizing the deal with shareholders. Once that is complete, they will begin planning new deployments and approaching customers with the combined solution.
The companies are still working out exactly what the acquisition will mean for the Augmedix brand, but it will likely look something like "Augmedix powered by Commure," Tandon said.
"If we do this integration well, and if we do our job well here, there will be a best in class product that actually solves many of these problems in the office, and then all the tasks that happen after the patient's gone as well," he said.
Read the full release about the deal here.
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