A Chevy Chase venture capital firm has invested $50 million in a company that sells mail-order diabetic supplies.
New Enterprise Associates made the investment in Simplex Diabetic Supply Inc. of Brentwood, Tenn.
Chip Linehan, one of NEA’s general partners, said the firm was drawn to the company because of successful marketing by its chief executive, Larson Douglas.
“He’s particularly good at leveraging new technologies like the Internet, as well as more efficiently leveraging older media like television,” Linehan said.
Linehan also said many more diabetics have been turning in recent years to mail-order companies for supplies such as glucose meters, which Simplex sells.
Simplex has been operating for only six months but has grown to become the industry’s 12th-largest supplier.
Diabetes affects nearly 21 million Americans, or 7 percent of the U.S. population, and that number is expected to grow, according to a 2005 report from the Centers for Disease Control and Prevention, the most recent available.
Diabetes patients account for more than 15 percent of the country’s drug spending, according to Simplex.
Simplex said Monday it will use the capital for future acquisitions.
NEA invests 40 to 45 percent of its funds in health care, Linehan said, with the rest going largely to information technology companies.
