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New Health-care Fund Invests in RFID

The Heritage Healthcare Innovation Fund has invested $7.5 million in RTLS company Awarepoint, which also received an additional $6.5 million from its existing investors.
By Claire Swedberg
Jun 08, 2012Heritage Group, a venture-capital firm specializing in the health-care industry, has completed the first two investments in its new Heritage Healthcare Innovation Fund Limited Partnership, with real-time location systems (RTLS) provider Awarepoint receiving $7.5 million from the fund's total account of $157 million.

According to Paul Wallace, the Heritage Group's managing director, the investment in Awarepoint signals the fund partners' interest in the benefits that RTLS technology provides to the health-care industry. In addition, he says, the ZigBee-based RFID solution offered by Awarepoint made it a desirable choice for RTLS end users, since the system is less expensive to install than many others, and is less likely to pose an interference problem with existing communication systems, such as Wi-Fi.

Awarepoint's CTO, Matt Perkins
The Heritage Healthcare Innovation Fund was established in January 2011, to identify and finance innovative businesses that deliver improved quality, service and efficiency for the health-care market, and to develop companies focused on solving problems identified by investors. The fund is also intended to enable its investors to benefit from the commercialization of innovative solutions they have been developed internally, through the development and launch of new companies. Its nine limited partners include some of the United States' leading hospital systems and health-care companies, which provide guidance to the fund's managers via four advisory committees: clinical, technology, finance and operations.

The fund's participants, Wallace says, intend to invest up to $15 million apiece in 10 to 15 companies that provide not just a financial return, but strategic benefits for the funds' limited partners, six of which operate hospitals. "We have a diverse group of investors," he states. The four latest partners are home health-care and hospice company Amedisys, pharmaceutical and medical product firm Cardinal Health, insurance company Health Care Service Corp. and Memorial Hermann Healthcare System. The other investors are Community Health Systems, Iowa Health System, LifePoint Hospitals, Trinity Health and Vanguard Health Systems.

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