Epocrates Inc. acquired Modality Inc. of Durham, N.C., for $13.8 million in cash.
Modality develops digital learning, assessment, training and reference applications for Apple iPad, iPhone and iPhone Touch mobile devices. Its acquisition will expand San Mateo, Calif.-based Epocrates’ product portfolio and Apple app-development workforce.
“We have the trust of more than one million healthcare professionals, and with Modality, a richer, advanced Apple development expertise,” Epocrates CEO Rose Crane said in prepared remarks. “Together, we will cultivate even more cutting-edge and indispensable apps for clinicians that directly impact patient care.”
Used by more than 175,000 U.S. physicians, Epocrates is the top drug reference application on Apple mobile technologies, the company said. With Modality’s Internetwork Operating System development expertise, Epocrates will try to churn out more new education and resource apps for clinicians.
Yesterday, Epocrates updated its registration statement for an initial public offering that could raise as much as $75 million. Epocrates plans to use the money raised through the offering to pay $28.6 million-worth of preferred stock dividends, as well as for working capital, research and development, sales and marketing and capital expenditures.
It’s the company’s second shot at an IPO. Epocrates filed for a $75 million initial public offering in 2008, then pulled the filing after the U.S. economic crisis began.
For the nine months ended Sept. 30, Epocrates had a net loss attributable to common shareholders of $1.5 million, or a loss of 16 cents a share, on revenues of $73.7 million. That compared to net income of $702,000 on revenues of $66.2 million, or 6 cents a share, in the same 2009 period. The company had 292 employees as of Sept. 30.