Doximity Acquires AI Startup Pathway Medical for $63M to Boost Clinical Tools

TL/DR –

Doximity is acquiring AI startup Pathway Medical for $63 million to enhance its clinical reference offering for doctors. Pathway’s AI-powered tool provides answers synthesized from medical literature on guidelines, drugs, and trials and is expected to bring robustness to the data Doximity has on its backend. The deal, which closed in late July, involved a cash consideration of $26 million and up to $37 million in additional equity grants.

Doximity Expands AI Capabilities with $63M Acquisition of Pathway Medical

Healthcare professionals’ network Doximity is expanding its artificial intelligence offerings through the acquisition of medical startup Pathway Medical for $63 million. Known for an AI-driven clinical reference tool that answers physicians’ queries on clinical guidelines, drugs and trials, Pathway Medical is touted by Doximity as one of the largest structured medical datasets.

Doximity is often compared to LinkedIn for doctors, providing services such as medical news updates, telehealth appointment facilitation, paperwork management, and referral finding. With Pathway Medical’s inclusion, Doximity aims to extend its platform as a go-to resource for answering doctors’ clinical inquiries.

Doximity CEO Jeff Tangney stated that the acquisition is an ideal match to enhance the platform’s AI capabilities. The deal, which finalized in late July, comprised a $26 million cash consideration and up to $37 million in additional equity grants.

The amalgamation of Doximity and Pathway Medical is in advanced stages, with a combined product already under testing with several physicians.

AI Health Tools Gain Traction as Doximity Boosts Data Robustness

As AI tools and chatbots increasingly field health-related questions from patient, Doximity already hosts a free AI product, Doximity GPT, that assists doctors in generating insurance letters and summarizing patient charts. Adding Pathway will augment the robustness of Doximity’s backend data, according to Dr. Amit Phull, Doximity’s Chief Clinical Experience Officer.

Phull emphasized Pathway’s extensive backend data set, which connects dosages, guidelines, literature, and citations, as a key advantage to the merger. Pathway’s model achieved a 96% score on the U.S. Medical Licensing Examination benchmark, a testament to its applicability of medical knowledge.

Public since 2021, Doximity has enjoyed a 10% stock increase this year after a 90% surge in 2024. This has boosted the company’s market cap to around $11 billion. Doximity’s stock rose 6% in extended trading on Thursday on the back of fiscal first-quarter results exceeding expectations. Revenue rose by 15% to $145.9 million, surpassing the anticipated $139.5 million, while earnings per share posted 36 cents, higher than the average 30-cent estimate.

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