Roche, the global pharmaceutical company from Switzerland, today announced it will scoop up Flatiron Health, a startup analyzing real-time oncology data to help cancer patients and doctors, in a $1.9 billion deal.
Flatiron has also confirmed the deal to TechCrunch.
Two years ago, Roche led a $175 million deal in the startup at a $1.2 billion valuation. At the time of the deal, Roche agreed to buy several of Flatiron’s subscription-based software products, positioning the company for an eventual initial public offering.
Flatiron CEO and co-founder Nat Turner said back then he planned to IPO in “two to three years,” according to The New York Times. The plan was to raise yet another round of funding before doing so. However, it seems Roche has other plans.
“This is an important step in our personalised healthcare strategy for Roche, as we believe that regulatory-grade real-world evidence is a key ingredient to accelerate the development of, and access to, new cancer treatments,” Roche CEO Daniel O’Day said in a press release regarding the acquisition today. “As a leading technology company in oncology, Flatiron Health is best positioned to provide the technology and data analytics infrastructure needed not only for Roche, but for oncology research and development efforts across the entire industry.”
O’Day mentioned in a company release the need to preserve Flatiron’s autonomy as a subsidiary. Turner also mentioned to CNBC that all employees, including the founding team, would stay on with the company.
Founding members Turner and Zach Weinberg both hailed from Google before pitching into healthcare, and it’s important to note this is the first big return for GV’s healthcare bets. In total, Flatiron was able to raise more than $313 million before Roche offered to buy the startup.
The $1.9 billion deal, which will be on a fully diluted basis and subject to certain conditions, is expected to close in the first half of this year, according to Flatiron.