July 2, 2024

HEALWELL AI Announces Successful Closing of Two Strategic Acquisitions: VeroSource Solutions and BioPharma Services

  • HEALWELL has completed the previously announced acquisitions of both VeroSource Solutions Inc. and BioPharma Services Inc., which boosts HEALWELL’s proforma annualized revenue run-rate to be greater than $65 million and significantly improves HEALWELL’s profitability.
  • Serving five different provincial health clients across Canada, VeroSource is an end-to-end, customizable, cloud-based data interoperability platform that enables patients, care providers and administrators to seamlessly access and interact with healthcare data.  
  • BioPharma is one of the largest full-service Contract Research Organizations (“CRO”) headquartered in Canada.  BioPharma is focused on bioequivalence and early-stage clinical trials, with over 2,200 clinical trials completed to date with approximately 250 pharma clients since inception.  
  • Both businesses are expected to be financially and strategically accretive, significantly enhancing HEALWELL’s financial profile and core capabilities which will now include comprehensive data science offerings for large enterprise clients such as the public sector as well as expanded clinical research offerings serving the pharmaceutical industry.   HEALWELL intends to leverage its artificial intelligence (“AI”) capabilities and expertise to expand and accelerate both BioPharma’s and VeroSource’s roadmaps. 

TORONTO, ON, July 2, 2024 – HEALWELL AI Inc. (“HEALWELL” or the “Company”) (TSX: AIDX, OTCQX: HWAIF), a healthcare technology company focused on AI and data science for preventative care, is pleased to announce the successful completion of its acquisitions of VeroSource Solutions Inc. (“VeroSource”), a healthcare technology software company providing both products and consulting services, and BioPharma Services Inc. (“BioPharma”), a leading full service CRO specializing in early clinical trials. HEALWELL’s pro-forma annualized revenue run-rate is now expected to be greater than $65 million per year. The total consideration paid for VeroSource is $19.6 million in addition to a four year earn-out of up to $4.9 million.  The total consideration paid for BioPharma is $12.5 million in addition to a three year earn-out of up to $2.5 million. 

Dr. Alexander Dobranowski, CEO of HEALWELL, commented, “We are excited to welcome the talented VeroSource and BioPharma teams led by leaders Mark McAllister and Anna Taylor respectively to the HEALWELL family which now includes more than 400 team members. With the addition of VeroSource and BioPharma, HEALWELL is now a larger, more robust company capable of participating in the complete pathway from discovery and early detection of patients using AI and our cloud-based data interoperability and integrated electronic health record (EHR) systems to placing qualified patients into clinical trials for better support. We look forward to the collaborative potential and synergies expected to emerge from the integration of these new acquisitions with our existing business units. We now have the tools to help large enterprises such as provincial health systems to not only better manage their health data but apply Artificial Intelligence to conduct next-generation population health and value based care strategies at scale. To our knowledge, no other company in Canada and very few globally have similar capabilities available in one company.” 

Both transactions are expected to be financially and strategically accretive, significantly enhancing HEALWELL’s financial profile and core capabilities which now include comprehensive data science offerings for large enterprise clients such as the public sector as well as expanded clinical research offerings serving the pharmaceutical industry.  HEALWELL intends to leverage its AI capabilities and expertise to expand and accelerate both BioPharma’s and VeroSource’s roadmaps. 

VeroSource Acquisition

The acquisition of VeroSource results in HEALWELL acquiring a number of broad and unique capabilities for the public sector that includes digital front door and patient access solutions, International Patient Summary (IPS) solutions, FHIR interoperability and data solutions, and digital identity solutions. It also adds VeroSource’s provincial public sector customer base to HEALWELL’s existing network of pharmaceutical customers, boosting the Company’s position as a leader in the healthcare technology landscape. VeroSource’s platform exemplifies the practical use of data engineering and machine learning as it utilizes AI tools to help clients predict emergency room wait times with real-time HL7 data feeds, improves hiring processes for HR departments, and explores the use of Large Language Models for better client navigation to essential services. VeroSource’s suite of solutions is designed to drive down healthcare costs and improve patient outcomes by providing health system leaders with actionable insights derived from advanced data visualization.  

VeroSource has had well over one million users since inception, which includes both patients and providers, and is expected to generate over $8 million in revenues in 2024 with expected EBITDA1 margins over 10%. Historically, VeroSource has achieved over 80% gross margins, and consistently produced positive EBITDA1, and positive cashflows. Over 70% of its sales are high margin recurring revenue. This acquisition adds significant revenue, a robust pipeline of long-term enterprise grade contracts, and an innovative digital health platform to HEALWELL. The acquisition is highly accretive, cash conservative, and is expected to deliver significant value. HEALWELL is expected to benefit from VeroSource’s recurring high-margin software and services revenue, strong relationships with private and public sector stakeholders, and a talented team of healthcare technology entrepreneurs, engineers, and data scientists. This acquisition marks a significant milestone in the ongoing effort to enhance healthcare delivery and improve patient outcomes through cutting-edge technology. 

On June 28, 2024, the parties to the VeroSource transaction amended the definitive agreement to acquire 100% of VeroSource rather than the previously announced two-step acquisition for the same total consideration.  As a result, HEALWELL acquired 100% of the outstanding shares of VeroSource for the following consideration: 

(i) approximately $4.1 million in cash, subject to customary closing adjustments and a three-month holdback; 

(ii) $11.9 million satisfied through the issuance of 5,722,250 HEALWELL subordinate voting shares; 

(iii) the issuance of a non-interest bearing promissory note in the principal amount of approximately $3.6 million due January 2, 2025, secured by a pledge of approximately 49% of the voting common shares of VeroSource; and 

(iv) a four-year performance-based earn-out of up to $4.9 million, payable in cash, HEALWELL subordinate voting shares or a combination of both, at HEALWELL’s discretion, with any shares priced using the prior 20-day closing VWAP from the applicable payment date. The performance-based earn-out is driven by maintaining and enhancing VeroSource’s EBITDA growth. If the full earnout is paid, the implied multiple of EBITDA paid by HEALWELL would be less than a 5 times multiple. 

BioPharma Acquisition

The acquisition of BioPharma will significantly expand the Company’s clinical research offerings and capabilities, complementing its existing clinical research business operated through its subsidiary, Canadian Phase Onward (“CPO”), and creating synergistic opportunities to capitalize on HEALWELL’s AI and data management capabilities. BioPharma is focused on bioequivalence and early-stage clinical trials, with over 2,200 clinical trials completed to date with approximately 250 pharma clients since inception. HEALWELL’s current technology and AI capabilities can unlock tremendous value and create efficiencies in clinical trials by improving trial design and architecture, accelerating trial mechanics, improving candidate eligibility screening, and, as it expands into later-phase trials, enhancing patient recruitment and screening processes.  

This strategic acquisition also creates opportunities for HEALWELL subsidiaries, Khure Health and Pentavere Research Group, to harness the data generated and further expand real-world evidence (RWE) clinical study work. BioPharma is expected to generate between $35 to $40 Million of revenue in 2024 with approximately 5% EBITDA1 operating margins based on YTD performance and has generated approximately $31 million of revenue in the trailing 12-month period. 

HEALWELL acquired 100% of the outstanding shares of BioPharma for the following consideration: 

(i) $4.25 million in cash, subject to customary closing adjustments; 

(ii) $2.5 million paid by way of the issuance of a promissory note secured against the shares of BioPharma and maturing on the first anniversary of the closing; 

(iii) $4.5 million (as adjusted to reflect working capital at closing) paid by way of the issuance of 2,053,645 HEALWELL subordinate voting shares at a price of $2.29 per share, based on the 15-day VWAP on the day prior to signing the share purchase agreement; 

(iv) $1.25 million paid by way of the issuance of 545,851 HEALWELL subordinate voting shares at the above VWAP price, which have been placed into a four-month escrow for indemnity purposes; and 

(v) up to $2.5 million to be paid as an earn-out over the three years following the closing.  If the full earnout is paid, the implied multiple of EBITDA paid by HEALWELL would likely be less than a 6 times multiple. 


1. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) and EBITDA margin (EBITDA divided by revenue) are each Non-GAAP measures. EBITDA and EBITDA margin should not be construed as alternatives to net income/loss determined in accordance with International Financial Reporting Standards (“IFRS”). EBITDA does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. The Company believes that EBITDA is a meaningful financial metric as it measures cash generated from operations which the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives. For EBITDA reconciliation to Net income, please refer to the Company’s most recent Management Discussion and Analysis on www.sedarplus.com. EBITDA margin is EBITDA as a percentage of total revenue. 

Dr. Alexander Dobranowski  
Chief Executive Officer 


HEALWELL is a healthcare technology company focused on AI and data science for preventative care. Its mission is to improve healthcare and save lives through early identification and detection of disease. Using its own proprietary AI technology and competencies which include data science, electronic health records and clinical research offerings, the Company is developing and commercializing advanced clinical decision support systems that can help healthcare providers detect rare and chronic diseases, improve efficiency of their practice and ultimately help improve patient health outcomes. HEALWELL is publicly traded on the Toronto Stock Exchange under the symbol “AIDX” and on the OTC Exchange under the symbol “HWAIF”. To learn more about HEALWELL, please visit https://healwell.ai/. 

About VeroSource Solutions Inc.

VeroSource Solutions is a digital health company established in 2014 to empower people and unlock the potential in Canadian healthcare. Its team of professionals has extensive experience in the full lifecycle of healthcare IT solutions and offers healthcare providers the technology and support needed to go digital. VeroSource’s cloud-first multi-channel software securely connects people, data and systems to drive digital healthcare transformation. Founded in Fredericton, NB, VeroSource has grown to include team members across Ontario and the Atlantic Canadian provinces. Visit www.verosource.com for more details. 

About BioPharma Services Inc.

BioPharma Services is a leading contract research organization (CRO) based in Toronto, Canada, specializing in Phase 1 and Phase 2a clinical trials. With a focus on scientific integrity, operational excellence, and adaptive processes tailored to each client’s needs, BioPharma Services has established a reputation for delivering high-quality results in the pharmaceutical and biotech industries. BioPharma’s comprehensive services also include Bioanalysis at their GLP Certified Laboratory, Scientific and Regulatory Affairs, Biostatistics and Safety Data Analysis (CDISC), Data Management and Medical Writing.  Visit www.biopharmaservices.com for more details. 

Forward Looking Statements

Certain statements in this press release, constitute “forward-looking information” and “forward looking statements” within the meaning of applicable Canadian securities laws and are based on assumptions, expectations, estimates and projections as of the date of this press release. Forward-looking statements in this press release include statements with respect to, among other things, the anticipated performance of VeroSource and BioPharma, potential opportunities for the growth of VeroSource and BioPharma, the potential synergies between VeroSource, BioPharma and the Company, including expected accretion on a financial and strategic basis, and the intention to leverage AI capabilities and expertise to expand and grow. Forward-looking statements are often, but not always, identified by words or phrases such as “opportunity”, “potential”, “improve”, “expect”, “intend”, “create” or variations of such words and phrases or statements that certain future conditions, actions, events or results “will”, “may”, “could”, “would”, “should”, “might” or “can” be taken, occur or be achieved, or the negative of any of these terms . Forward-looking statements are necessarily based upon management’s perceptions of historical trends, current conditions and expected future developments, as well as a number of specific factors and assumptions that, while considered reasonable by HEALWELL as of the date of such statements, are outside of HEALWELL’s control and are inherently subject to significant business, economic and competitive uncertainties and contingencies which could result in the forward-looking statements ultimately being entirely or partially incorrect or untrue. Forward looking statements contained in this press release are based on various assumptions, including, but not limited to, the following: HEALWELL’s ability to integrate the VeroSource and BioPharma businesses into HEALWELL; HEALWELL’s ability to leverage AI, data management and other services and expertise to expand and accelerate VeroSource’s and BioPharma’s service offerings; trends in customer growth; HEALWELL’s ability to develop new technologies and the timelines on which they can be developed; new technologies functioning as expected; customers adopting and using new technologies and services as expected; the need to develop increasingly innovative products and services; competition in the industry; the stability of general economic and market conditions; HEALWELL’s ability to comply with applicable laws and regulations; HEALWELL’s continued compliance with third party intellectual property rights; and that the risk factors noted below, collectively, do not have a material impact on HEALWELL’s business, operations, revenues and/or results. By their nature, forward-looking statements are subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections, or conclusions will not prove to be accurate, that assumptions may not be correct, and that objectives, strategic goals and priorities will not be achieved. 

Known and unknown risk factors, many of which are beyond the control of HEALWELL, could cause the actual results of HEALWELL to differ materially from the results, performance, achievements, or developments expressed or implied by such forward-looking statements. Such risk factors include but are not limited to those factors which are discussed under the section entitled “Risk Factors” in HEALWELL’s most recent annual information form dated April 1, 2024, which is available under HEALWELL’s SEDAR+ profile at www.sedarplus.com. The risk factors are not intended to represent a complete list of the factors that could affect HEALWELL and the reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking statements. There can be no assurance that forward looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management’s expectations and plans relating to the future. HEALWELL disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law. All of the forward-looking statements contained in this press release are qualified by these cautionary statements. 

This news release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about HEALWELL’s expected increase in revenue, cash flow, EBITDA1 and EBITDA1 margin on a post-closing basis, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set out in the above paragraphs. The actual financial results of HEALWELL on a post-closing basis may vary from the amounts set out herein and such variation may be material. HEALWELL and its management believe that the FOFI has been prepared on a reasonable basis, reflecting management’s best estimates and judgments. However, because this information is subjective and subject to numerous risks, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, HEALWELL undertakes no obligation to update such FOFI. FOFI contained in this news release was made as of the date hereof and was provided for the purpose of providing further information about HEALWELL’s anticipated future business operations on a post-closing basis. Readers are cautioned that the FOFI contained in this news release should not be used for purposes other than for which it is disclosed herein. 

For more information:

Pardeep S. Sangha  
Investor Relations, HEALWELL AI Inc.
Phone: 604-572-6392