Fresenius enters three-way merger to create new kidney care company

Fresenius Medical Care announced Monday that it entered into an agreement to form a new independent company focused on providing "value-based kidney care" in the US. The three-way merger involving Fresenius Health Partners, InterWell Health and Cricket Health, is expected to close in the second half, and will operate under the InterWell Health brand, with a value of $2.4 billion and Fresenius Medical Care as the majority owner.

Rice Powell, CEO of Fresenius Medical Care, called the move an "important next step in executing [our] growth strategy 2025 to further expand along the renal care continuum and to refine and grow our future operating model in care delivery." Bill Valle, head of the company's North America division and future care delivery segment, suggested the combination will help by "reducing hospital admissions and readmissions, slowing disease progression, increasing transplant referrals and rates, accelerating the transition to home dialysis, and improving clinical outcomes…for patients with lower overall costs for payors."

Expanding addressable market

The merger brings together Fresenius' existing presence in the US kidney-care space, InterWell's clinical care models and network of 1600 nephrologists, and Cricket's technology-enabled care model that uses its proprietary StageSmart informatics along with its patient engagement platforms. The new company aims to handle the care of more than 270,000 patients with kidney disease and manage around $11 billion in medical costs by 2025. Fresenius Medical Care estimates the deal will boost its total addressable market in the US from about $50 billion to roughly $170 billion.

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