Cost transparency company Castlight Health has filed paperwork for an initial public offering with the SEC, according to a report by Dan Primack over at Fortune.
The report also says Castlight is expected to seek a valuation upwards of $2 billion. Goldman Sachs is slated to lead the offering and Morgan Stanley is expected to serve as underwriter.
The company's IPO has been expected for just under two years. In May 2012, Castlight raised $100 million from T. Rowe Price, Redmile Group and two unidentified mutual funds and at the time Castlight cofounder and CEO Giovanni Colella said he expected the company to IPO next in the face of increasing competition from similar tools coming out from health plans.
Other investors include Morgan Stanley Investment Management, The Wellcome Trust, U.S. Venture Partners, Cleveland Clinic, Maverick Capital, Oak Investment Partners and Venrock. Castlight's total funding to date is $160 million.
Castlight Health offers employers a personalized platform, online and on iOS or Android, to compare prices of healthcare services and keep track of healthcare spending so that employers can reduce that spending over time. The company also integrates prescription drug information into the platform so that they can also track medication cost.
Some of Castlight’s customers include Kraft Foods Group, Life Technologies, Honeywell, CVS Caremark, and Liberty Mutual.
Since Colella made his IPO prediction in 2012, many different companies such as Healthcare Blue Book and Health Sparq have launched cost transparency tools.
Just in the past month, four companies with cost transparency products have made news. UnitedHealth, an insurer, launched a cost transparency tool for its members along with an appointment booking system. Medlio launched an app that acts as a virtual insurance card, but aims to eventually offer cost transparency estimates. Healthcare Blue Book, which has been around since 2007, raised $7 million from The Martin Companies. Finally, HealthSparq acquired ClarusHealth Solutions, an online provider search tool.
In November 2012, Venture capital firm InterWest Partners' survey of 100 entrepreneurs working in digital health suggested that Practice Fusion, Castlight Health and ZocDoc could be the next companies in the sector to go public. Twenty six percent of the group surveyed thought Practice Fusion would IPO, followed by 21 percent for Castlight Health and 19 percent for ZocDoc.
