Sector Update: Health Care Stocks Advance Late Afternoon

Health care stocks rose late Wednesday afternoon, with the NYSE Health Care Index and the Health Care Select Sector SPDR Fund (XLV) each up 0.6%.

The iShares Biotechnology ETF (IBB) shed 0.4%.

In corporate news, Accolade shares gained 104% after it agreed to be bought and delisted by Transcarent in a $621 million deal.

Accolade, Inc. (ACCD) is currently at $6.86, up $3.51 or 104.63%

• Would be highest close since June 6, 2024, when it closed at $6.88
• Would be largest percent increase on record (Based on available data back to July 2, 2020)
• Currently up three of the past four days
• Up 100.44% month-to-date
• Up 100.44% year-to-date
• Down 88.52% from its all-time closing high of $59.72 on Dec. 10, 2020
• Down 54.36% from 52 weeks ago (Jan. 10, 2024), when it closed at $15.02
• Down 54.36% from its 52-week closing high of $15.02 on Jan. 10, 2024
• Up 117.62% from its 52-week closing low of $3.15 on Nov. 4, 2024
• Traded as high as $6.92; highest intraday level since June 3, 2024, when it hit $7.25
• Up 106.57% at today's intraday high; largest intraday percent increase on record (Based on available data back to July 2, 2020)

All data as of 3:14:18 PM ET

Source: Dow Jones Market Data, FactSet

Accolade agreed to be acquired and delisted by Transcarent in a $621 million deal that's expected to deliver a more personalized healthcare experience for people.

Transcarent, which recently launched a WayFinding artificial intelligence chatbot that promises instant and trusted health information, will pay $7.03 per Accolade share, according to a joint statement released Wednesday. The cash consideration represents a premium of about 110% over Accolade's closing price on Tuesday.

Accolade provides access to primary care, mental health support and expert medical opinions.

Following close, Accolade will operate as a private company. The combined entity will have 1,400 employer and payer clients. Shares of Accolade more than doubled intraday on Wednesday.

"The two companies share a focus on embracing AI and advanced technology to change the way consumers experience the healthcare system," Accolade Chief Executive Rajeev Singh said in the statement. The companies plan to create a more personalized healthcare experience that will drive down costs for people, he said.

Transcarent will finance the transaction through equity financing led by General Catalyst, led by Hemant Taneja, and 62 Ventures, owned by Transcarent CEO Glen Tullman.

"We are excited to double down on creating a powerful AI platform enabling consumers to take charge of their care," Taneja said. "Since Glen and I created Transcarent, our vision has been to transform healthcare at scale and this acquisition brings us closer to that vision."

The transaction is expected to close during the second quarter of 2025, pending approvals from regulators and Accolade' shareholders.

"Transcarent and Accolade have complementary solutions and the two companies merging creates cross-sell opportunities," Truist Securities said in a note. "Employers are increasingly looking for 'one stop' solutions and have been focused on consolidating digital health vendor partnerships."