TTA’s summer #10: Google shuts NHS’ Streams app, Headspace and Ginger merge for their mental health, healthcare too much for Big Tech, Cerner’s CEO pay packet, more!

 

 

Weekly Update

Google continues shedding Health initiatives with shutdown of NHS’ Streams clinical support app. But is health care too much for Big Tech accustomed to monetizing clicks and ads? Headspace and Ginger decide to merge rather than be bought, as digimental health stays hot. Beth Israel Deaconess shows how hospital IT can get its skates on with telehealth. And Cerner’s pay package for its new CEO shows you that crime does not pay, but healthcare certainly does!

Editor’s Note: We’ll be on hiatus from 31 Aug to 14 Sept for an extended end of summer holiday. Articles will resume around the 14th-15th and Alerts on 18 Sept. Enjoy the rest of summer and your holiday!

Mental health apps Headspace, Ginger to merge into $3B Headspace Health (Better to merge than to be bought? The sprint of digital mental health continues.)
Another Google termination: Google Streams clinical support app used by NHS (Another broken healthcare toy)
Amazon’s Chime telehealth solution rang Beth Israel Deaconess Medical Center’s bells–case study (How hospital IT can innovate under pressure)
Is healthcare too much for Big Tech’s Google and Apple? Look at the track record. And David Feinberg’s $34M Cerner package. (Too much, too soon?)

Our weekend lead news is Google Health’s shutdown, with its head graduating to the Big Job at Cerner. Rockley Photonics may be revolutionizing the smartwatch with its photonic vitals sensors. Sharecare expands health ed and enters the once-sleepy home care biz. Humana also bets big on home care with Kindred, SDOH heats up, Maven’s a unicorn, and Carrots are on the healthcare plate with the trimmings.

Breaking: Google Health shutting down, most employees scattered to other divisions (And its head is now Cerner CEO)
Deal and news roundup: Humana closes $5.7B Kindred at Home buy, Unite Us SDOH buys Carrot Health for data, Carrot Fertility raises $75M, Maven Clinic at $1B value, Privia partners with Babyscripts for moms, Tyto Care and Prisma Health
Sharecare expands health education capabilities, acquires CareLinx home care for $65M (updated) (A healthcare conglomerate in the making?)
Comprehensive “clinic-on-the-wrist” digital health sensor system debuts. Apple Watch of future? (UK/US) (Rockley Photonics’ big leap)

The news isn’t taking a Summer Holiday, neither are deals. Honor just rocked the sleepy home care world with its buy of Home Instead. UnitedHealth will have to wait till end of year for Change. Morgan Health debuts with $50M in Vera Health. The Telehealth Teeter-Totter continues with Amwell’s gloomy forecast, Teladoc’s Aetna deal. And Voices Carry with stress testing and a neuroprothesis that may give communication back to those who cannot speak. 

Home care rocked: Honor Technology acquires home care provider Home Instead (It’s all about the caregivers and hospital-at-home)
News roundup: update on UnitedHealth/Change Healthcare DOJ check, Tunstall adds new CTO, Amwell’s gloomy second half, Teladoc’s Aetna deal, Fitbit and LifeScan diabetes
Hearing voices: Cigna-Ellipsis AI-powered voice stress test; UCSF/Weill neuroprosthesis decodes attempted speech (Giving speech to the speechless in the future)
News and funding roundup: patient outreachers Relatient, Radix merge; health apps top 350,000; Morgan’s $50M in Vera Health; Communicare247, Doro, TeleAlarm join Scottish Digital Telecare’s list

A short one this week in the rollup to HIMSS. Funding and deals aren’t taking the summer off despite it being August, and this year’s first half just beat full year 2020.

News and funding roundup: BioIntelliSense ‘stickers’ $45M, Exo ultrasound scans $220M, Enovation gets Scotland OK, WellSky snaps up Healthify, Cerner’s good quarter despite VA (And summer is supposed to be quiet?)
2021’s bubbly $14.7 billion in digital health funding–six months that beat all of 2020 (Rock Health’s rock’n’rolling 1st half)

Telehealth Wars teeter-totter with now Amwell and national expansion on the upside. NHS England’s changing of the guard–Roy Lilley’s insightful interview with Sir Simon. Telemental health prospers. Alcuris gets the cyber-OK from Scotland. And Cerner needs to get it right with the VA, right quick.

The Roy Lilley-Sir Simon Stevens ‘Health Chat’ interview (As the order changes at NHS England)
News and deal roundup: another big mental health app funding, Happify Health’s prescription therapy app debuts, Alcuris approved by Scottish Digital Telecare for cybersecurity (Mental health continues to be the It of Digital Health)
Telehealth Wars: Amwell’s raises game with buys of SilverCloud and Conversa Health; Teladoc’s slow member, hospital growth lead to $133M Q2 loss (The seesaw goes up for one, down for the other)
Cerner execs to VA Congressional committee: “We are committed to getting this right” (After $16 billion, One. Would. Hope. So.)
Over 400 telehealth groups urge Congress to retain CARES Acts gains on remote care (Obsolete law change long overdue)

The big news for UK GPs this week was that the GPDPR’s extraction scheduled for 1 Sept is stopped for a Big Rework. Big Blue’s Watson Health dying in pieces, reportedly up for sale. But SPACs and investments have slowed only a bit for the summer with Owlet’s $1bn SPAC and digital health’s torrid $15bn first half. 

Softly, softly: GPDPR comes to screeching halt, indefinitely, to be reworked (Don’t hold yer breath!)
News and deals roundup: Owlet’s $1B SPAC, Carbon Health’s $350M Series D, Series Bs by Woebot Health and b.Well, digital health rakes in $15bn (Owlet ‘socks it’ to the market, behavioral health and digital health match the hot weather)
Oh, MAMA! The Medical Alert Monitoring Association meeting, 28-29 September, Chicago (They’ll need the alerts in Chi-Town)
IBM Watson Health’s stumble and possible fall (The World Was Not Theirs, leading to Death By A Million Cuts)

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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

Thanks for asking for update emails. Please tell your colleagues about this news service and, if you have relevant information to share with the rest of the world, please let me know.

Donna Cusano, Editor In Chief
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Mental health apps Headspace, Ginger to merge into $3B Headspace Health

Two acquisition prospects, Headspace and Ginger, decided to beat the heat and merge. The two companies, currently headquartered in Santa Monica and San Francisco, will combine into Headspace Health. From the context of the release, the Ginger brand will be sunsetting. The merger is expected to close in Q4 subject to the usual regulatory and financial approvals. Financial terms were not disclosed. The combined company claims a valuation of $3 billion.

Leadership will combine from both companies. Russell Glass, Ginger’s present CEO, will be CEO of Headspace Health. CeCe Morken will remain CEO of Headspace and take on the additional role of President for the combined entity. 

Digital mental health continues to be hot in a hot August. Headspace, which started as a mindfulness and meditation app in 2010, then sidled into behavioral coaching to mitigate stress and aid in sleep, to date raised $216 million through a Series C (Crunchbase). Ginger, a cognitive therapy service with both self-guided coaching and psychiatric video consults, was founded in 2011 and raised $220 million through a Series E. Headspace has a direct to consumer focus with business partnerships with Google, Roche, and employers, while Ginger has developed into a benefit for payers like Cigna and Amerihealth Caritas. The combined company claims it will cover 100 million lives direct-to-consumer and through its more than 2,700 employers and health plan partners.

It is obvious from the management setup and the overpadded release (sorry, but it’s true!) that the lead company in this is Headspace. Can an IPO be far away? Release, Healthcare Dive

Funding roundup: new unicorn Capsule’s $300M, $100M for Caresyntax, Sesame Care’s $24M, UCM Digital Care’s $5M; MD Ally brings telehealth to 911

This week’s (so far) Big Raise is virtual pharmacy Capsule. Their new funding of $300 million, added to a previous $270 million in five rounds through a 2019 Series C (Crunchbase), now, according to CEO Eric Kinariwala, puts his company into $1 bn unicorn territory. Founded in New York City in 2015, Capsule now covers the NY metro plus a dozen markets in same-day delivery plus the option for pharmacist chat/text via mobile phone. Their goal is to reach 100 million people nationally by the end of this year. The fresh funding will be used for expansion and to upgrade technology. Durable Capital Partners led the funding round and was joined by new investors Baillie Gifford, T Rowe Price, and Whale Rock.

Capsule is in a hot niche sector of fast prescription delivery that has players large (CVS, Walgreens’ AllianceRx), Amazon (PillPack, Amazon Pharmacy), and smaller or local services like Blink Health, FetchMyRx, Medly, and your local pharmacy. Uber is also partnering with some for delivery. Earlier this year, Capsule partnered with Ginger to fill and deliver medications prescribed by their board-certified psychiatrists in metro New York City, Chicago, Minneapolis, Boston, and Austin. FierceHealthcare, Mobihealthnews, Bloomberg (may be paywalled)

Mobihealthnews also rounded up three additional digital health fundings from the seed to Series C range:

  • Surgery data/AI plus virtual consult platform Caresyntax, closed a $100 million Series C funding round led by PFM Health Sciences LP. Release.
  • NYC-area direct-pay healthcare marketplace Sesame Care added a $24 million Series B, for a total of $47.6 million to date (Crunchbase). Sesame offers in-person and telehealth care to patients, allowing them to compare prices and providers before booking and paying the provider directly. 
  • UCM Digital Health, a provider of emergency telemedicine and virtual health, announced today it closed a $5.5 million Series A funding round. Armory Square Ventures led the round with additional participation from Contour Ventures and River Park Ventures. Based in Troy, NY, UCM has a “digital front door” platform with a 24/7 telehealth treat, triage and navigation service marketed to employers, insurers, and providers. Release
  • Last but certainly not least, MD Ally added a modest $3.5 million in a seed round led by General Catalyst with participation from Seae Ventures. MD Ally triages 911 emergency services calls, rerouting non-emergency calls to telehealth services and expanding their scope of services. It integrates into existing dispatch systems with a unique range of codes that confirm for the dispatcher that the call can be safely routed to a telehealth provider. TechCrunch, release

Deals and news roundup: Ginger’s $100M, myNEXUS to Anthem, Everlywell snaps up PWN, Amwell’s banner year for revenue–and loss, VA reviews Cerner rollout, voice visits for MA, GE’s vScan goes wireless, uBiome founders indicted

Deals–and news–are piling up like Easter eggs before the hunt. Mental health and cognitive digital therapy scored another raise with Ginger‘s $100 million Series E to fund expansion into health plan and government partnerships. Blackstone Growth led the round. Total funding to date is $220 million. It’s entered unicorn status with a valuation just north of $1 bn. Ginger to date has concentrated on corporate mental healthcare. From being an ugly duckling only a few years ago, digital mental therapies are this year’s ‘it’. But competition is fierce: the traditional telehealth companies such as Teladoc, Doctor on Demand, and Amwell are closing in on the early entrants such as AbleTo. Direct-to-consumer models like Talkspace; UK/Ireland’s SilverCloud Health; and Lyra, Spring Health, and Happify, which just closed a $73 million Series D, all step out with slightly different ‘differentiators’ but target the same companies, health plans, and health systems. FierceHealthcare, Ginger release

Home health is also another former ugly duckling transformed into a swan. Anthem is acquiring home health/nursing management company myNEXUS, which manages home-based nursing services for 1.7 million Medicare Advantage members across 20 states. Their digital authorization and visit management couples with a nationwide network of providers and nursing agencies for local care. Exiting myNEXUS are private equity investors led by New York’s WindRose Health Investors, after four rounds and a conservative $31 million in funding (Crunchbase). Neither terms nor management transitions were disclosed. myNEXUS will join Anthem’s Diversified Business Group. FierceHealthcare, release.

Home testing+telehealth company Everlywell (not connected with the Everly Brothers) has a different take on home health. They are now integrating their self-test kits with fully owned lab testing. New acquisitions PWNHealth and its subsidiary Home Access Health Corporation will join Everlywell in Everly Group. PWN was Everlywell’s main telehealth partner and diagnostic testing partner since 2016. It will become Everly Health Solutions with their testing data kept separate from Everlywell’s. Home Access was PWN’s self-collected lab test company. Everly Health now will support more than 20 million people annually in all 50 U.S. states, Canada, and Puerto Rico. Acquisition terms were not disclosed. PWN’s CEO will take a seat on the Everly Group board to assist integration. Valuation is now estimated at $2.9 bn.  Mobihealthnews, Everly release, Bloomberg News

And in other news…

Amwell reported a Very Good Year in their telehealth services, with visits growing to 5.9 million from 2019’s 1.1 million. Total revenue was up over 65 percent to $245.3 million. However, profitability continues to be elusive, with net loss almost equaling revenue. Release

The Department of Veterans Affairs (VA) finally announced a review of the Cerner-Leidos EHR integration. Back in February, VA was hanging tough on the rollout after the GAO report questioning its wisdom and recommending postponement until high severity issues were corrected. Secretary Denis McDonough, new VA head, has directed the undertaking of a 12 week strategic review without pausing the project. Taking bets on that 12 weeks! Healthcare Dive

Payers and their lobbyists are supporting a newly reintroduced House bill that would permit telephonic-only telehealth visits to be reimbursed for their Medicare Advantage plans after HHS closes the pandemic period. There is considerable information that video/audio virtual visits still have limitations with the 65+ group, clustered around high-speed internet or good data connections, smartphones, and computers with cameras, making video visits difficult or impossible. Which begs the question about continuing coverage for those on Original Medicare. Healthcare Dive

Those readers with long memories will recall GE Healthcare’s heralded introduction of the VScan handheld clinical-grade ultrasound device–back in 2010, complete with Eric Topol rave and demo. Not much has been heard from GEHC since till this month, and other competitors, such as the Butterfly IQ from 4Catalyzer, have made handheld ultrasound common and affordable. GEHC announced Vscan Air, a fully wireless version that connects to iOS or Android. It was FDA cleared in November 2020 and will be shipping its dual-headed probe and accessories starting 1 April for a US-listed target price of $4,495. GEHC page (with the cute domain vscan.rocks), Mobihealthnews

And in our Scandal Sheet section, a Federal grand jury in the Northern District of California has indicted the founders of now-bankrupt uBiome on 40-odd counts encompassing conspiracy to commit securities fraud, conspiracy to commit health care fraud, money laundering, and identity theft. Separately, the Securities and Exchange Commission (SEC) also filed charges. Between 2016 and 2018, uBiome had raised $100 million through a Series C, and was likened to Theranos, after its fall, in the Big Claim (‘inventing the microbiome industry’). Its business was analyzing the DNA of fecal and other biological matter to sequence the bacteria of the body’s microbiome. Starting with low-cost, limited data comparison for at-home tests, the founders progressed to claiming to doctors that their diagnostic tests were clinical-quality and would be reimbursed by payers. Payers did–for awhile–and the investors piled in. By 2019, the wheels fell off their scheme and the FBI came knocking at their Silicon Valley offices after the founders cashed in. Chapter 7 followed in late 2019. The Register reports that the two married founders are on the run, whereabouts unknown. US Attorney’s Office release, SEC filing (PDF)

 

Drug discounter GoodRx plans US IPO; Ginger mental health coaching raises $50 million

The bubble bath got soapier with more IPOs and big raises on tap. 

GoodRx, the relentlessly advertised prescription discount scheme with spokespeople Martin Sheen and son Charlie, has filed initial paperwork with the US Securities and Exchange Commission (SEC) for a potential initial public offering (IPO). This has been in the rumor mill for a while. Timing would be about 4th Quarter or early in 2021, according to Reuters.

It may at least a partial exit for Sand Road PE giant Silver Lake Partners, which took a one-third interest in GoodRx in August 2018, creating an estimated value at $2.8bn. CNBC  Both their growth since then and key hires have indicated preparation for going public. According to MedCityNews, their revenue is up by 55 percent since 2018 and they now employ 350 people. As mentioned above, they advertise heavily on TV with celebrity endorsers. In June, two IPO-experienced executives joined the company (release): new president Bansi Nagji, McKesson’s former chief strategy officer who was on Change Healthcare’s board during its IPO; and CFO Karsten Voermann from acquisition company Mercer Advisors and who led Mercury Payment Systems through its 2014 IPO.

Ginger, formally known as Ginger.io, raised $50 million in Series D funding. Lead investors are Advance Venture Partners and Bessemer Venture Partners, with participation from Cigna Ventures, Kaiser Permanente Ventures, and LinkedIn Executive Chairman Jeff Weiner. Ginger provides on-demand mental health coaching as part of employee benefits within the US. Their release claims 200 companies, health plans Optum Behavioral Health, Anthem California, and Aetna Resources for Living, and tripled revenue in the past year. According to Crunchbase, this is their ninth funding round with a raise total of $120 million. Mobihealthnews