Athenahealth’s Expanding Product Roadmap

According to a report by MarketsandMarkets, the electronic medical record (EMR) and electronic health record (EHR) industry in the U.S. is estimated to be worth $6 billion by 2015. The report projects an annual growth rate of 18% over the five-year period 2010 through 2015.

Athenahealth’s Financials
Athenahealth’s (NASDAQ:ATHN) Q1 revenues grew 30% over the year to $125.6 million, ahead of the Street’s target of $122 million. Revenues included $5.5 million from the acquisition of Epocrates made last quarter. EPS of $0.16 was also ahead of the market’s projections of $0.12 for the quarter.

By segment, revenues from business services grew 30% over the year to $121.5 million, and revenues from implementation and others grew 37% to $4.1 million.

Among operating metrics, use of athenaCollector by medical providers grew 21% over the year and that of physicians 20%. The use of athenaClinicals by medical providers and physicians grew 64% each over the year. The utilization of athenaCommunicator grew nearly two and a half times to 16,296 medical providers.

For the current year, athenahealth projects revenues of $580 million-$615 million, with adjusted EPS of $1.05-$1.15.

Athenahealth’s Product Expansion
Athenahealth has been focusing on product and service expansion through tie-ups with other service providers to grow their market share. During the last quarter, they added athenaClarity to their EHR solutions. athenaClarity is a comprehensive cloud-based service that is designed to help clients manage their network of physicians and patients and converts raw data into meaningful and actionable information. The service helps providers measure the performance of their practice by geography or specialty.

They also tied up with Mashery, a provider of application programming interfaces (API) management technology and services. Through the tie-up, the two will work together to provide new web services–based APIs for the health care IT developer market segment. Athenahealth hopes to leverage the relationship to deliver turn-key connectivity to their cloud-based platform of services and to their existing network.

They also entered into an agreement with another health care service provider, iTriage. iTriage provides the ability to customize health care treatment by offering a symptom-to-provider pathway through platform and mobile/website applications to their eight million consumers. As part of the agreement, athenahealth’s medical provider network will be connected to iTriage’s customers and will enable providers and patients to connect with each other sooner for treatment through the Internet or the iTriage app.

Earlier this month, the company launched athenahealth Marketplace, a stop for health care provider organizations and physician practices to browse and shop for health care IT solutions (HIT) that will augment and complement athenahealth’s suite of cloud-based services. The Marketplace offers several workflow efficiency and care coordination solutions from leading HIT vendors. Athena believes the services is to “what Amazon.com is for consumers” for the health care service providers. Athenahealth plans to extend the marketplace to be able to create an open, cloud-based platform that will leverage APIs, connectivity, and multiple applications to deliver efficient solutions to the health care industry.

Athenahealth’s stock is currently trading at $84.72 with a market capitalization of $3.1 billion. It touched a 52-week high of $99.79 in March 2013.