DaVita's (DVA) Latest Partnership to Improve Kidney Care
DaVita Inc. DVA recently announced that it has collaborated with Google Cloud, Alphabet Inc.’s GOOGL Google business’ segment. The tie-up aims to create a new clinical operating system, Center Without Walls (CWOW), that sets a foundation for streamlined kidney care for DaVita’s patients.
DaVita's CWOW, built on Google Cloud infrastructure and utilizing artificial intelligence (AI) and analytics tools co-developed by the two companies, is now live across the organization's dialysis centers nationwide.
With the deployment of DaVita's CWOW, the company has moved from a decentralized clinical documentation system to a unified platform that leverages data from more than 30 million dialysis treatments per year to generate insights designed to help improve clinical outcomes.
The latest collaboration is expected to significantly boost DaVita's business across the nation and solidify its foothold in the niche space.
Rationale Behind the Partnership
Per DaVita's estimates, chronic kidney disease (CKD) currently affects more than one in seven adults in the United States and an estimated 37 million Americans. However, nine in 10 adults having CKD are not aware they have the disease.
Also, presently, an estimated 50% of people diagnosed with kidney failure start dialysis treatment without warning in an emergency situation (known as crashing). Crashing not only causes physical and emotional stress for patients but also it costs, on average, an additional $53,000 per patient in the first year of dialysis treatment.
Per DaVita's management, CWOW is expected to provide caregivers access to the right data at the required time to improve. Management believes that since CWOW is custom-built for kidney care, Alphabet’s Google Cloud infrastructure will likely allow DaVita to connect with its physician and hospital partners to establish a consistent flow of information from the beginning of a patient's kidney care journey.
Alphabet’s Google’s management believes that working with DaVita will enable it to develop and deploy CWOW and bring together Google Cloud's advanced AI and analytics capabilities with DaVita's aim of treating and preventing kidney disease.
Industry Prospects
Per a report by Precedence Research, the global end-stage renal disease market was estimated to be $105.22 billion in 2022 and is anticipated to reach $372.31 billion by 2032 at a CAGR of approximately 13.5%. Factors like the increase in kidney failure patients and the introduction of technologically advanced products are expected to drive the market.
Given the market potential, the latest tie-up is expected to significantly boost DaVita's business.
Notable Development
In August, DaVita announced its second-quarter 2023 results, wherein it registered an uptick in its overall top line and dialysis patient service revenues. An increase in total U.S. dialysis treatments during the quarter was also recorded. DaVita also opened several dialysis centers within the United States and overseas, which was promising.
Comparison With Peers
A notable name in the renal care space is Fresenius Medical Care AG & Co. KGaA FMS. In August, FMS announced the receipt of the FDA’s 510(k) clearance for VersiHD with GuideMe Software. VersiHD is Fresenius Medical’s chronic home hemodialysis system that was first introduced in 2017.
The same month, FMS announced its second-quarter 2023 results, wherein it recorded improving treatment volumes as well as a stabilizing labor environment in the United States. Overall price improvements also supported growth in the Care Enablement segment and its international sales improved. Fresenius Medical’s newly implemented operating model also led to operational improvements.
Addus HomeCare Corporation ADUS is another peer of DaVita. In August, ADUS completed the acquisition of the entities comprising Tennessee Quality Care, a Franklin, TN-based provider of home health, hospice and private duty nursing services. This is expected to expand Addus HomeCare’s market coverage to all three levels of home care in Tennessee.
In June, ADUS announced its second-quarter 2023 results, wherein it recorded a solid uptick in its net service revenues. Per management, the company’s strong volume trends in personal care (its largest segment) were a significant driver of its growth for the quarter. The demand for ADUS’ personal care services also continued to grow, reflecting a greater awareness of the value of home-based care as the preferred and most cost-effective option for many individuals.
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DaVita Inc. (DVA) : Free Stock Analysis Report
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