Demand for online doctors creates a $39-bn titan

Two decades ago, Itaru Tanimura ended a 12-year run at McKinsey & Co to lead M3 Inc, an online provider of medical information and services backed by entertainment giant Sony Corp.

What followed was a flurry of acquisitions that turned the Tokyobased company into a $39 billion global behemoth.

M3 now has about 40 subsidiaries and affiliates, including MDLinx Inc. in the US and Britain's Doctors.net.uk.

M3 helps pharmaceutical companies, doctors and their patients access information online over its platforms, removing the need for in-person visits -- something that proved important in the time of Covid-19. Its shares have almost doubled this year, surging the most of any company in the Nikkei 225 Stock Average and taking the fortune of Tanimura to $1.2 billion, according to the Bloomberg Billionaires Index.

"Online doctor capabilities are in the spotlight with Covid, as people are staying home," Jefferies Japan Ltd analyst Hiroko Sato said in an interview. "It's really a theme stock."

A rush by smaller pharma companies to digitalize marketing materials after the coronavirus outbreak helped boost sales, with inquiries skyrocketing. M3's operating profit climbed 26 per cent in the quarter ended in June.

The company's name stands for "the three Ms of Medicine, Media and Metamorphosis," and its goal is to change medicine by "making full use of the power of the Internet," according to its website.

Its acquisition-spree started in 2002, when M3 bought the Japanese unit of US medical portal site WebMD. MDLinx was acquired in 2006 and Doctors.net.uk in 2011. M3, which gets about three-quarters of its revenue from Japan, also has units in China, India and France. One of its US subsidiaries was selected to take part in Moderna Inc's Covid-19 vaccine study.

Tanimura, 55, is president and holds a 2.9 per cent stake in M3. Sony owns about a third of the company. M3 declined to comment for this story, while Sony didn't respond to phone calls and an email seeking comment.

The pandemic has produced vast wealth gains amongst both tech and pharma titans. Amazon.com Inc's Jeff Bezos has amassed more than anyone else, with his fortune hitting $200 billion, while Tencent Holdings Ltd's Pony Ma and Jiang Rensheng, the chairman of vaccine maker Chongqing Zhifei Biological Products Co, have added more than $11 billion each.

While M3 said in its earnings report that Covid-19 disrupted some of its business, it always has Sony to lean on. The entertainment giant unveiled a $100 million relief fund to help tackle the outbreak in April and funnelled some of that cash toward M3.

"Sony and M3 will be able to bring unprecedented ideas to the medical community," Tanimura said.