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(Reuters) - PatientPoint said on Tuesday it had raised $140 million in a financing round, the latest healthcare technology company to attract investment as the pace of U.S. healthcare spending rises faster than inflation.
The funding for PatientPoint, which sells advertising in doctors' offices and hospitals, came less than a month after larger competitor Outcome Health raised over $500 million from investors such as Alphabet's growth equity fund CapitalG and Goldman Sachs (GS.N).
Spending on healthcare in the United States is about $3.5 trillion a year, representing about 18 percent of U.S. gross domestic product.
Cincinnati-based PatientPoint is one the players in the point-of-care industry, which puts advertisers and pharmaceutical companies in front of a captive audience in hospital waiting rooms and exam rooms. The company also develops health news and educational materials for patients.
Searchlight Capital Partners and Silver Point Capital were the investors in the latest financing round. L Catterton, which acquired the company in 2007, will remain an investor.
The new funding will be used to expand PatientPoint's digital content such as interactive touch screens, which currently makes up roughly half of its products, Chief Executive Mike Collette said in an interview.
"The possibilities are limitless in terms of the various types of content that physicians and patients can engage with," Collette said.
The most recent investment values the company at roughly $500 million, according to a person familiar with the matter, who did want to be named because the valuation of the deal was not disclosed.
PatientPoint says it delivers health-information content via print and digital devices at 1,000 hospitals and 31,000 physician offices across the country.
The company aims to double its digital footprint by 2018 and triple it by 2019, and the company also wants to expand into the realm of virtual medicine, Collette said.
Boutique investment bank Peter J. Solomon Company, a unit of Natixis SA (CNAT.PA), advised PatientPoint.
Reporting by Melissa Wen in San Francisco; additional reporting by Liana B. Baker in San Francisco; Editing by Andrew Hay