On Friday, Teladoc Health (NYSE:) announced in a press release the unexpected departure of its longtime CEO Jason Gorevic, effective immediately.
Meanwhile, the board appointed Mala Murthy, chief financial officer, as Gorevic’s interim replacement and also retained an executive search firm to search for a permanent CEO.
“We thank Jason for his many accomplishments and contributions during his 15 years leading Teladoc Health. We wish him success in his future endeavors,” Teladoc Chairman David Snow Jr. said in a statement.
Gorevic, who took the reins at Teladoc in 2009, helped guide the company through the challenges of the COVID-19 pandemic and helped drive the transition to virtual healthcare delivery.
“We suspect that the Board of Directors has given Gorevic a much longer leash than most executives would have been given, given the long relationship between CEO Gorevic and Chairman David Snow, which dates back more than 20 years to their managed care days at Empire Blue. Cross,” Deutsche Bank analysts said in their comments regarding Gorevic’s departure.
“We believe the company’s failure to capitalize on opportunities in chronic disease management and slowing behavioral growth may have been key points of contention between the CEO and board,” they added.
Going forward, Deutsche expects a shift in the company’s message toward a greater emphasis on profitability, a change that has already begun to emerge in recent quarters.
Reflecting on the same development, BTIG analysts said Gorevic’s departure is “not entirely surprising” given the significant decline TDOC has faced in recent years.
They believe that the telemedicine market has recently undergone significant changes.
In particular, the COVID-19 pandemic catalyzed enormous growth in telemedicine as patients and physicians sought safe methods to access care. However, the landscape has changed since then.
Health plans and employers are now prioritizing results, “which we believe means the bar for overall efficiency has been raised,” BTIG analysts said.