TTA’s New Year First: Digital health’s funding, utilization soars–so does CoronaDepression; Haven shutters, CES and JPM open next week

 

Our first postings for 2021 focus on digital health’s funding Boom Town, also confirming that utilization gains made during the worst of 2020 are sticking. Haven, the three-headed hydra that was going to slay the ‘hungry tapeworm’, is closing. But never fear–CES and JPM are next week, with plenty of news to be expected.

Digital Health as Boom Town: 2020’s dizzying funding rounded up by Mercom Capital, StartUp Health (Funding fiddles merrily while COVID burns)
Telehealth claims rose 3,060 percent to October, settling in to over 5 percent of all claims–led by mental health (US) (Telehealth utilization sticks–but so is CoronaDepression)
New Year’s Deal and Event Roundup: Optum-Change Healthcare, Walgreens-Amerisource Bergen, December’s deal potpourri, CES and JPM (No sign of deal cooldown, and big events go virtual)
Haven finds no haven in healthcare, will close in February (Where lack of focus and an embarassment of egos will get you)

A few last thoughts for a year like no other in Modern Times. There was some news, including a big raise plus an IPO filing for a US payer and unavoidably on COVID for the Abbott antigen/telehealth test. And warm your heart with the visit of Liverpool FC to Alder Hey in West Derby.

We wish you a Merry Christmas and a Happier 2021! (No matter where you’re locked down, and lucky you if you’re not!)
4 min 40 seconds of holiday cheer: Liverpool FC visits Alder Hey Children’s Hospital (Made possible by a telehealth robot)
News roundup, lockdown edition: Oscar Health’s $140M raise, IPO filing; Centene’s Diameter Health investment; Abbott’s telehealth-guided COVID antigen test

Telehealth getting the big US push between the Milken Institute report and a consortium of industry groups pressing Congress for national reimbursement. Even Amazon gets into the act–sort of. Contact tracing and vaccination get a customized notification approach. More confirmation of the ubiquity of ‘lockdown loneliness’, spiking for the already depressed and anxious. For those developing new products, we introduce you to an R&D resource.

Developing a medical, healthcare, or life sciences product? Here’s a R&D resource. 
News roundup: Milken Institute’s telehealth brief with ATA push on Congress, GoodRx confirms 62% are CoronaDepressed, Johns Hopkins’ COVID mortality risk study and calculators (Big US telehealth push, more isolation depression confirmation, and calculate your COVID risk)
AI-powered contact tracing as part of an ‘application ecosystem’ for COVID-19 information and vaccination (A customized approach much better than constant annoying calls)
Amazon’s feint into large employer telehealth; HealthLake dives into structured health data analytics (Stick to your AWS knitting, Amazon)

Is the festive season really upon us? While it doesn’t feel like it at all, it’s a relief to look forward with Laurie Orlov’s latest report on the future of remote care and an example of how telehealth integrates into modern UK supportive housing. Unfortunately, reality bites with more ‘lockdown loneliness’ effects on older adults, making this a dud of a holiday for most. We also catch the most recent top financings, tech-enabled COVID testing, and finish with a rousing list of top tech influencers.

Who are the top tech influencers in UK, Germany, and France? Tyto PR compiles a ‘Tech 500 Power List’. (Hancock #1, ORCHA makes #3)
Weekend Must Read: The Future of Remote Care Technology and Older Adults 2020 (COVID-19 upended it, like everything else)
Lockdown Loneliness feared more than COVID-19 by nearly 1 in 6 over-65 Britons: study (More research on the mental health effects on the vulnerable)
News roundup: Cera hits £89.5M revenues, Alcove Carephone in new elder housing, Everlywell home test kits raise $179M; FDA clears Lucira’s all-in-one COVID test kit, Apple Watch new ECG feature (All enabled–even testing–by apps and telehealth)

As autumn builds up to winter and the holidays–and the close of a year that felt like a high-tech combination of Medieval Times and the Spanish Inquisition–health tech deals and VC action stack up, the first tranche of the Walgreens Boots-VillageMD alliance opens for business, and we slog through CMS’ 2021 telehealth and RPM rules so you don’t have to.

Global deals roundup: bubbly Butterfly blank check, Imprivata-FairWarning, Virta Health, OTV, WithMe Health, Perfood, Sofía (A whole lot of M&A, funding, and VC fund action worldwide)
Walgreens and VillageMD kickstarting the ‘Go Big’ strategy of over 500 co-located primary care offices (Bucking up Walgreens’ retail and pharmacy business with a huge physician group operation)
CMS expands telehealth, RPM in 2021 Physician Fee Schedule, creates post-pandemic temporary category (updated) (This weekend’s Big Read if you’re in the US telehealth or RPM business. Some wins for telehealth, but repeal for geographic restrictions isn’t one of them.)

Despite more pandemic lockdowns, it’s Thanksgiving in the US and in approaching the holidays, it’s time to give thanks. Theranos’ legal maneuvering never fails to amuse and amaze. A headset using brain stimulation may relieve the depression resulting from ‘lockdown loneliness’. CVS Aetna is helping low-income Medicaid recipients with SDOH. The investment bubble around health tech enriches two more companies. And another digital thanking wall goes up courtesy of the UK’s Thank and Praise.

The Theranos Story, ch. 68: the texts told the tech failure–and please omit Holmes’ ‘luxurious lifestyle’ and profane meeting language from trial (The continuing soap opera)
Flow depression treatment headset/app addresses UK ‘lockdown loneliness’ of as high as 27% (UK/EU) (It’s more relevant than ever)
Health tech M&A moves: Well Health’s $45M Series C, GigHealth2/UpHealth’s $1.35 bn ‘blank check’ acquisition (Ka-ching!)
Thank and Praise thanking wall adopted by United Lincolnshire Hospitals NHS Trust 
CVS Aetna testing social determinants of health with Medicaid HealthTag pilot (Meshing efforts as part of Destination: Health)

Have a job to fill? Seeking a position? Free listings available to match our Readers with the right opportunities. Email Editor Donna.


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Telehealth & Telecare Aware: covering the news on latest developments in telecare, telehealth, telemedicine and health tech, worldwide–thoughtfully and from the view of fellow professionals

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Donna Cusano, Editor In Chief
donna.cusano@telecareaware.com

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Digital Health as Boom Town: 2020’s dizzying funding rounded up by Mercom Capital, StartUp Health

BOOM! Mercom Capital Group published their Q4 and 2020 roundup of global digital health investment and, no surprise, the investment picture for just about anything digital health was in sharp contrast to most of the COVID-afflicted world economy.

The topline:

  • Global VC funding (private equity and corporate venture capital) was $14.8 bn across 637 deals. It was a 66 percent increase in funding compared to 2019’s $8.9 bn in 615 deals. The modest increase in deal number and huge increase in funding points to the acquisition of more established companies requiring Big Deals.
  • Total corporate funding, including VC, debt, and public market financing, totaled $21.6 billion

 

In a stunning change, telemedicine was Top Of The Pops, with $4.3 bn in investment, 139 percent over 2019’s $1.8 bn. It was over double the former star categories of data analytics and mHealth apps.

The top five disclosed M&A transactions in 2020 they tracked were:

  • Teladoc’s acquisition of Livongo Health for $18.5 bn
  • Blackstone’s acquisition of a majority stake in Ancestry.com for $4.7 bn (despite the ‘bloom off the rose’ of consumer genetic testing)
  • Philips’ acquisition of BioTelemetry in cardiac monitoring for $2.8 bn
  • Invitae’s acquisition of ArcherDX for $1.4 bn
  • WellSky’s acquisition of Allscripts’s CarePort Health (CarePort) for $1.35 bn

The Executive Summary is available for free download at the link in the release. The full report will set you back $599 – $999, depending on the version.

StartUp Health has slightly different numbers but in total investment tracks almost to Mercom Capital’s estimate at $21.5 bn. For telemedicine, it still triples year-over-year but StartUp’s totals are lower: 2019’s $1.1 bn to 2020’s $3.1 bn. Part of the difference may be remote monitoring, which StartUp considers separately. It doubled from $417 million to $941 million. Their deal counts were also higher: 764 in 2020 compared to 716 in 2019. Another fun fact in their tracking are their city leaders in health innovation funding: Beijing, Tel Aviv, and London, confirming that New York and the San Francisco metro no longer have money, interest, or their former attraction. A fuller list would have been interesting. More is in their Part 1 study. Part 2, to be released next week, will cover their dozen ‘health moonshots’.

Considering 2019’s digital health investment picture: leveling off may be a Good Thing

2019 proved to be a leveling-off year for digital health investment. The bath may prove to be more cleansing than bubbly.

We noted that the always-fizzy Rock Health engaged in some revisionist history on its forecasts when the final numbers came in–$7.4bn in total investment and 359 deals, a 10 percent drop versus 2018. When we looked back at our 2019 mid-year article on Rock Health’s forecast [TTA 25 July], they projected that the year would end at $8.4 bn and 360 deals versus 2018’s $8.2 bn and 376 deals. That is a full $1bn under forecast and $0.8 below 2018. Ouch!

In their account, the 10 percent dip versus 2018 is due to average deal size–decreasing to $19.8M in 2019–and a drop in late-stage deals. Their analysts attribute this to wobbliness around some high-profile IPOs, citing Uber, Lyft, and Slack, as well as the near-collapse of WeWork right before its IPO towards the end of 2019.

New investors and repeat investors increased to 627 from 585 in 2018, with no real change in composition.

The headliners of 2019 were:

  • Amazon’s acquisition of Health Navigator adding symptom-checking tools to its health offerings
  • Google’s buy of Fitbit
  • Optum’s purchase of Vivify Health, which gives it a full remote patient monitoring (RPM) suite (right when CMS is setting reimbursement codes for RPM in Medicare)
  • Best Buy’s addition of Critical Signal Technologies for RPM
  • Phreesia, Livongo’s and Health Catalyst’s IPOs. For Livongo and Health Catalyst, current share prices are off from their IPOs and shortly after: past $25 for LVGO and $31 for HCAT. Phreesia closed today at a healthy $33, substantially up from PHR’s debut at $15. (Change Healthcare, on the other hand, is up a little from its IPO at $16, which isn’t bad considering their circumstances on their financing.)

Rock Health only counts US deals in excess of $2 million, which excludes the global picture, but includes some questionable (in this Editor’s estimation) ‘digital health’ players like Peloton, explained in the 25 July article.

Rock Health’s analysts close (and justify their revisions) through discussions with VCs expecting further headwinds in the market–then turn around and positively note the Federal backing of further developments in building the foundation for connected health as tailwinds. No bubbly forecasts for 2020–we’ll have to wait.

Is this necessarily bad? This Editor likes an occasional dose of reason and is not displeased at Rock Health’s absence of kvelling.

Confirming the picture is Mercom Capital’s analysis which also recorded a 6 percent dip 2019/2018: $8.9bn with 615 deals, dropping from the $9.5bn and 698 deals in 2018. Their ‘catchment’ is more global than Rock Health, and encompasses consumer-centric and patient-centric technologies and sub-technologies. Total corporate funding reached $10.1bn.

Global HIT, digital health VC funding falls 35% in 1st Q 2015: Mercom Capital

Mercom Capital Group, a research and communications group, tracks global VC funding, mergers and acquisitions in the digital health area and notes a distinct slowing of activity, except for mobile health. They tracked $784 million in 142 deals in Q1 2015 compared to $1.2 billion in 134 deals in Q4 2014. Leading are consumer health companies with $437 million in 98 deals, then healthcare practice-centric companies, with $347 million in 44 deals–both dropping over $200 million each versus the previous quarter. Mobile health companies had $282 million in 56 deals; app companies accounted for $220 million. In transactions, mobile health led with $578 million, with UnderArmour’s acquisitions of MyFitnessPal and Endomondo. Since 2010, digital health companies have raised almost $10 billion. Mercom Capital release (the full study will run about $300-500). mHealthIntelligence notes that M&A activity is steadily rising in the healthcare sector. Also iHealthBeat.

Health IT funding bubble seen by veteran investor

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2012/12/crystal-ball.jpg” thumb_width=”120″ /] How is health tech like the 1990s ‘dot-com’-ers? Veteran Silicon Valley investor (HealthTech Capital) and former entrepreneur Anne DeGheest projects a ‘Series B crunch‘ in funding health tech and IT in an interview with The Wall Street Journal’s Venture Capital Dispatch. The key factors: angels and ‘unsophisticated investors’ are pouring money into all sorts of devices, apps and related services in seed and Series A stages just to get on board in a hot sector. When the founders of these companies get to Series B and present to more demanding investors, the lack of a true value proposition and a detailed business plan that answers basic questions leave them standing on, as aptly put, ‘a pier to nowhere’ or as Joe Hage termed it last month, ‘insolvent with a great idea.’

Ms. DeGheest’s view that we are reprising the elements of the ‘dot-com’ bubble is confirmed by the numbers in Rock Health‘s and PwC‘s funding reports throughout 2013:   (more…)