Medsphere Systems on Tuesday secured $12 million in venture funding.
The funding round, a combined private equity and debt financing, was led by Azure Capital Partners, Epic Ventures, Thomas Weisel Venture Partners, and Western Technology Investment. Capital from this investment will be used to expand Medsphere System’s national operations.
Medsphere Systems, of Carlsbad, California, is a provider of open-source health care technology that serves domestic hospital markets, including the federal government’s Indian Health Service. The company’s Electronic Health Record (EHR) platform is known as Medsphere OpenVista. OpenVista is a commercialized version of the Linux-based open-source U.S. Veterans Administration's public domain EHR, known as Vista.
According to Medshpere Systems, the Obama administration’s American Recovery and Re-investment Act will place funding of up to $19 billion dollars into healthcare's IT industry, creating the need for an Electronic Health Record system like that of Medsphere's OpenVista.
“The nationwide push for healthcare reform and the focus on electronic health records as a key component in reform are having a measurable impact on health IT demand,” Irv Lichtenwald, chief financial officer at Medsphere, said in a statement.
In a study published in the March 2009 online edition of the New England Journal of Medicine, nearly 3,000 hospitals were surveyed, 74 percent of which cited a lack of capital was hindering them from implimenting a much needed EHR system.
With federal stimulus underway, these hospitals are likely to turn to technology from the likes of Medsphere and others.