Summit-backed concierge-medicine provider returns to market

Summit Partners is exploring the sale of MDVIP Inc, the country’s largest provider of so-called concierge medicine, Buyouts has learned.

The Boston investor has owned the provider of customized healthcare services on two separate occasions. Summit first invested in MDVIP in 2004, eventually selling the Boca Raton, Florida, company to consumer-products giant Procter & Gamble in 2009. Summit repurchased MDVIP in 2014.

Piper Jaffray, which advised MDVIP on its 2009 sale, is advising on the sales process, a source familiar with the matter said.

The company is projecting around $40 million of adjusted EBITDA in 2017, this person said. The Wall Street Journal in February 2014 reported that MDVIP generated about $16 million in EBITDA the prior year.

The company is likely to garner interest from both sponsors and strategics, with a sale to PE viewed as a more likely outcome, sources said.

MDVIP, which manages a network of 900-plus physicians in more than 40 states, charges patients an annual fee ranging from $1,650 to $2,200. The company is understood to be significantly larger than other providers of concierge-medicine services.

MDVIP-affiliated practices offer preventative medicine and customized primary care. The idea is that patients get more face time, preferential services and immediate access to doctors. Doctors at MDVIP-affiliated practices see an average of about 8 to 10 patients a day, as opposed to about 18 patients in a typical internal and family practice, MDVIP states on its website.

Members also get access to various services that aren’t covered by commercial insurance or Medicare, including a wellness plan created through advanced health screenings and diagnostic tests that aren’t typically covered by insurance.

While the concept is perceived by some to be tailored to the high-income population, the model is likely to become more attractive for a larger population base as high-deductible healthcare plans become increasingly common, one of the sources said. In other words, as patients spend more out-of-pocket dollars, the concierge segment becomes more attractive.

MDVIP is led by Chairman and CEO Bret Jorgensen, who rejoined as an executive in June 2014 after Summit repurchased the company. The industry veteran also served as CEO prior to MDVIP’s December 2009 sale to P&G.

The Summit team leading the MDVIP investment includes Managing Directors Mark deLaar and Martin Mannion.

For Summit, the process for MDVIP comes on the heels of its sale of DuPage Medical Group. Ares Management said last week that it was investing in the Chicago-area medical group in a deal valued at about $1.45 billion.

Representatives of Summit, MDVIP and Piper Jaffray did not immediately return requests for comment.

Action Item: Reach out to Summit’s Mark deLaar at mdelaar@summitpartners.com

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