After Teladoc’s massive merger with Livongo, several of the digital health startup’s top leaders will depart. Livongo President Dr. Jennifer Schneider, who held a public role with the company, and often shared dual her perspectives as a physician and a type 1 diabetes patient, will leave the company. So will CEO Zane Burke, who joined the company last year after serving as a longtime Cerner executive, CFO Lee Shapiro and Senior Vice President of Business Development Steve Schwartz, according to a recent filing with the Securities and Exchange Commission.
“We have retained key leaders across Livongo’s clinical services, data science, product and human resource functions, who have been instrumental in Livongo’s significant growth and progress,” Christian Stenrud, Teladoc’s vice president of communications, wrote in an email. “Zane and Jenny have played a substantial role in shaping the leadership teams that will steer the successful integration of the two organizations. We wish them well in their future endeavors.”
The two companies announced plans for their $18.5 billion merger in August, creating ripples across the digital health industry. Livongo would offer continued engagement with patients with diabetes, heart disease and other conditions in between telehealth visits.
Teladoc CEO Jason Gorevic will lead the combined company, and much of its executive leadership, including its CFO, COO, and chief marketing officer, will come from Teladoc. Livongo’s Chief Human Resources Officer, Arnnon Geshuri, will stay on after the merger.
The board will consist of eight directors from Teladoc, including Gorevic, and five from Livongo, including founder and executive chairman Glen Tullman.
The companies will also merge their respective research and development teams, including chief engineers, data scientists, product officers and medical officers. A new leader will head up the combined company’s research and development efforts, but in the interim, they will be led by Teladoc’s innovation fellow, Yulun Wang.
The deal is expected to close by the end of 2020, with Teladoc acquiring Livongo’s shares for $158.98 in stock and cash, and assuming $550 million of its debt. Analysts continue to be bullish about the future prospects of the combination.
“We continue to believe in the long-term market share capture opportunity and think the merger with Teladoc will only enhance this given the limited customer overlap (merely 25%) and significant cross sell opportunity,” Lisa Gill, JP Morgan’s managing director of U.S. Healthcare Technology and Distribution Equity Research, wrote in an Oct. 14 research note.
It’s not clear what Livongo’s leadership has planned next, but some of them recently teamed up with General Catalyst to create a new special purpose acquisition company, with the goal of raising $500 million to take a healthcare company public. In recent months, a spate of digital health companies have gone public after being acquired by SPACs, including direct-to-consumer health startup Hims & Hers.
General Catalyst sponsored the new blank-check company, Health Assurance Acquisition Corp., according to an S-1 filing. General Catalyst Managing Director Hemant Taneja, who also had a hand in starting Livongo, established the new company along with Schneider, Tullman, and three other managers.
Photo credit: Dmitrii_Guzhanin, Getty Images