Covera Health, an AI-enabled diagnostic technology company focused on radiology, has finalized its acquisition of CoRead, an AI quality assurance company, the organizations announced last week. In addition, Covera Health has secured up to $50 million in additional Series C funding.
New York City-based Covera Health works with providers to help them improve the quality of their radiology care and works with payers and employers to ensure that members and employees are directed to the best radiology provider for their needs. Its customers include Walmart, Premera Blue Cross and Nuance. CoRead, based in Cary, North Carolina, offers a solution that helps radiologists identify blindspots and misdiagnoses. Its solution has been validated on data from more than 2,000 hospital sites in the U.S.
The terms of the deal have not been disclosed. Through the acquisition, CoRead’s services will be integrated into Covera’s platform. Covera chose to acquire CoRead because of the “synergies” between the two companies, said Ron Vianu, founder and CEO of Covera Health. In addition, acquiring CoRead helps Covera grow its operations.
“It will allow us to scale fairly dramatically the tools that we’re able to deliver to our provider community… For us, it’s about speed to market,” Vianu said in an interview. “How do we deliver more and more quality insights around errors and omissions that practices are committing back to those practices so they can incorporate that into their learning programs? And similarly, we can take those insights and understand what impact they’re having when looking at claims data and other sorts of data on patient outcomes, and then work with payers to build programs to mitigate poor outcomes related to these sorts of errors.”
For CoRead, joining Covera allows the company to deepen its relationship with payers.
“We were primarily working with providers and in order to do big things within healthcare, we were missing a huge stakeholder there. … Making sure all three parties — patients, providers and payers — are aligned and aligned in the right direction, making sure that quality of care is better, is critical,” said Lawrence Ngo, former CEO of CoRead, in an interview. Ngo will become senior vice president of the quality assurance platform at Covera.
In addition to the acquisition news, Covera announced up to $50 million in additional Series C funding that was led by Insight Partners. In total, Covera has raised more than $100 million. The company plans to use this funding to reach more employers and payers, as well as to deploy more tools to providers, Vianu said.
The deal and the financing come at a time when there is a lot of variability in patient diagnoses, according to Vianu. This is a problem both Covera and CoRead are trying to solve.
“You can go to two different imaging centers to get a prostate MRI and walk out from one center and the MRI will be absolutely normal and say, ‘You’re fine, you don’t have prostate cancer.’ Another center can send you down this path to have a biopsy,” Vianu said.
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