Investment firms Spectrum Equity and Cressey & Co have agreed to acquire a majority stake in Verisys Corporation, a U.S. provider of data and software that help healthcare providers with regulatory compliance, people familiar with the matter said.
The roughly $75 million investment will help Verisys accelerate its expansion plans by building out its sales and marketing division, the people said on Monday. Verisys' chief executive officer, John Benson, is also investing alongside Spectrum and Cressey, the people added.
The sources asked not to be identified because the deal is not expected to be announced before Tuesday. Verisys, Spectrum Equity and Cressey offered no comment.
Verisys operates a database called the Fraud and Abuse Control Information System (FACIS), which helps healthcare providers, payers, and pharmacies avoid compliance mishaps by providing detailed background screenings for suppliers and employers.
FACIS aggregates data from more than 3,500 sources dating back to 1992.
Verisys also offers several software programs aimed at helping healthcare providers and pharmacies.
About 10 percent of Medicare and Medicaid spending is wasted on fraud and abuse, according to a 2015 report by the U.S. Government Accountability Office.
This is Verysis’ first major outside investment. The company has previously been wholly self-funded.
For Spectrum, the investment allows it to build on its existing portfolio in healthcare technology and regulatory compliance. Its holdings include Ancestry.com, GoodRx and Definitive Healthcare.
(Reporting by Carl O'Donnell in New York)