WellDoc, developer of a prescribable Type 2 diabetes management smartphone app (BlueStar), announced today a $20 million Series A round from Merck Global Health Innovation Fund and Windham Venture Partners. The interest by Merck is understandable in several ways. Pharma companies are moving beyond the meds into other management models as blockbuster drugs become scarce (those cuts in R&D do hurt down the line), operating costs higher and profitable drugs go off patent. Because it is prescribable, BlueStar is reimbursable by US insurers (not disclosed by WellDoc); it is currently offered as a pharmacy benefit by Ford Motor and major drugstore chain RiteAid. In addition to these, WellDoc has developed strong partnerships (AT&T, Alere) since their founding in 2005 (see below). BlueStar also can be considered a strong fit for a Merck subsidiary, Vree Health. Vree had previously (2011-2) developed its own in-house iPhone diabetes management app which did not gain traction, then pivoted to care transition and weight management. (One wonders if the Alere partnership will continue as they may be considered a competitor to Vree.)
The hefty Series A comes fairly late in WellDoc’s development and deliberately so. Half of their $35 million debt/equity angel funding to date came from Stewart Greenebaum, a patient of Dr. Suzanne Sysko, an endocrinologist and sister of founder/CEO Ryan Sysko, and one of its earliest users. According to Forbes, Mr. Greenebaum advised avoiding VCs because they did not understand products which blend life science and technology. A look at CrunchBase reveals December activity of $4.15 million in venture round funding leading up to the Series A. With this under the belt, Mr. Sysko now welcomes further investment. Forbes, Dow Jones VentureWire
Previously in TTA: We’ve been alert to WellDoc since the 2009 Connected Health Symposium–which demonstrates how long their development process has been even with FDA approval in 2010 (a message to the ‘develop fast and get out’ crowd). What is notable are their many partnerships, including Ford Motor, AT&T ForHealth, Alere and others just during 2012-13: Ford and WellDoc give a new meaning to mobile health (US), Alere, WellDoc, AT&T ForHealth deliver diabetes management (US), more coverage here.