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Tuesday, April 16, 2024

Cary-based CoRead sold to New York biotech

New York-based biotechnology firm Covera Health has acquired CoRead, a diagnostic technology firm based out of Cary.

Terms were not disclosed.

Lawrence Ngo, a Duke University School of Medicine alum and radiologist, cofounded CoRead alongside University of Wisconsin-Madison alum Dr. Jacob Johnson in 2018 with the aim of finding radiological screening misdiagnosis at scale using artificial intelligence.

Radiology is becoming increasingly important as physicians begin to depend more on X-rays, CT scans and MRIs to make diagnoses, Ngo says.

But radiologists are currently reimbursed on the quantity of work rather than the quality of their work, he says — something he hopes Covera and CoRead are able to change by restructuring the incentives by which radiologists do their work. Covera’s platform supports the end-to-end delivery of clinical-grade, AI-powered quality insights for providers and insurers, according to Covera Health.

“So now if they’re potentially reimbursed based on the quality of their work as opposed to purely the volume of their work, then everyone’s incentives are aligned for the patient,” Ngo says. “To the radiologists, to the insurance company to the government — everyone is moving in the same direction.”

Ngo says that Covera and CoRead are two of the only firms working at the intersection of AI and radiology, making the partnership strategic in that Covera Healthcare will be able to reach more stakeholders including patients, insurers and employers.

“I think it really comes down to this strategic opportunity where it’s the confluence of the rise of radiology, the rise of AI and certainly the tremendous traction and relationships that Covera has built to date,” he says. “Together, we’re servicing all three stakeholders in a way that I think no one else can.”

He said CoRead’s acquisition comes as the Durham firm has already deployed its tool at over 2,000 hospital sites and looks to scale its impact.

Ngo said that CoRead will continue to have a presence in in the area.

All CoRead employees will be retained, he said, and the group will now be in charge of what Ngo says Covera is calling a “quality assurance platform.”

“The idea is that we’re building out this platform that’s comprehensive,” he said. “It’s every type of study, typology.”

Covera Health also announced on Wednesday up to $50 million in additional Series C funding led by Insight Partners, of which $25 million has already been committed.

“There are over 1,300 imaging exams performed every minute in the U.S. These studies serve as the backbone of our healthcare system and are central to a patient’s diagnosis, but their impact is often underestimated,” said Ron Vianu, the founder and CEO of Covera Health, in a release. “Enhancing the field’s ability to quantify and improve diagnostic quality is essential to both improve patient outcomes and ensure providers are compensated for the value they provide.”

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