AVP’s Investment in Boulder Care
The Advance Venture Partners (“AVP”) team has been pursuing a long-term thesis centered around “digital health” businesses utilizing technology to meaningfully: a) improve treatment outcomes in specific healthcare verticals, b) reduce the cost of care for patients and payors, and c) expand access to care across relevant populations and demographic groups. This journey began with our 2016 investment in Curology, now a leader in the telemedical dermatology space, and continued with our subsequent investments in Ginger (now Headspace) in the behavioral health space and Parsley Health in the functional medicine space. We are excited to announce our most recent digital health investment: AVP is leading the Series C financing for Boulder Care, backing Co-Founder and CEO Stephanie Strong and her team in building a category-leading platform for high-quality telemedical treatment in the substance use disorder (“SUD”) space.
SUD, and particularly opioid use disorder (“OUD”), has become an impossible problem for us to ignore. Every day, more than 210 Americans die as a result of an opioid overdose. Following an initial wave of deaths in the 1990s (driven by the aggressive marketing of highly-addictive prescription opioids like OxyContin), and a second, deadlier wave in the early 2010s (driven by the greater availability of illegal semi-synthetic opioids like heroin), the American opioid epidemic took a dark turn in the mid-2010s, when illegal synthetic opioids like fentanyl (which is 50x more potent than heroin and 100x more potent than morphine) began to flood the U.S. market. Between 2015 and 2020, the annual rate of U.S. opioid overdose deaths more than doubled from 10.4 to 21.4 per 100K Americans. By 2017, the U.S. Department of Health and Human Services was forced to declare the opioid epidemic a public health emergency. The epidemic was further exacerbated by the adverse mental health effects of the COVID-19 pandemic in 2020 and beyond. In 2023, a record 112K Americans died of drug overdoses and approximately 70% of these deaths were attributable to fentanyl / synthetic opioids. Despite concerted law enforcement efforts, illegal opioid drugs remain cheap and widely available.
A staggering 2.7% of Americans over the age of 12 — more than 8MM in total — are estimated to have been affected by OUD. The existing network of roughly 17K drug rehabilitation and treatment centers across the U.S. is often described as a “Wild West” of expensive, poorly-regulated, and poorly-evidenced programs. Approximately 75% of these centers only offer abstinence-based, non-medical care, which means people experiencing addiction can’t get help until they are ready and able to stop taking drugs. These dynamics, coupled with a variety of other barriers such as clinician shortages, stigmatization, high costs of care, and transportation challenges in rural areas, have driven over 87% of the Americans affected by OUD to not seek out any form of treatment for their condition.
Medication-Assisted Treatment (“MAT”) has been clinically proven to be the most effective method of treating OUD. Studies have shown that MAT (utilizing buprenorphine and other similar drugs) can drive a 128% reduction in OUD-related hospitalizations, a 70% reduction in overdose risk, and an 80% reduction in all-cause hospitalizations. However, accessing MAT in-person has still proven to be challenging for many Americans, despite several peer-reviewed studies having established that virtual OUD MAT delivers equivalent or better outcomes than in-person care. Additionally, a recent survey of OUD-affected Americans actually showed that over 75% of this population prefers telemedicine-based OUD care to in-person care.
When AVP met Stephanie Strong in early 2024, it didn’t take us long to realize that she and her team were building something special at Boulder Care. As a former healthcare public policy consultant and investor / operator in the SUD treatment space, Stephanie had recognized a unique opportunity to bring a patient-centric, MAT-based telehealth model to a chronically underserved Medicaid patient population. Given the socioeconomically disproportionate impact of the opioid crisis on lower-income and minority Americans, over 40% of OUD-affected Americans are covered by Medicaid. However, this population faces a variety of barriers to accessing high-quality OUD care. This is where Boulder Care enters the picture. Alongside clinically-robust MAT protocols, which optimize for same-day / next-day appointments (vs. weeks-long wait times for in-person treatment) and rapid prescriptions of often life-saving medications, Boulder delivers care tailored to meet the diverse needs of Medicaid patients. By integrating peer recovery support specialists, care navigators, and case managers (many of whom have deep ties to their patients’ communities) into their care model, Boulder is able to take a truly holistic approach to serving their patients. Boulder’s care teams collaborate with emergency departments, inpatient groups, and hospital discharge managers to ensure that patients have adequate support after an episode, while working hand-in-hand with primary care practices, federally-qualified health centers, and other community health organizations who do not have the ability to treat complex addiction in their practices, thereby filling some of the “care gaps” that lead to the system failing this patient population. Via their “Keep Our Cure” campaign, Stephanie and the Boulder Care team have been champions for OUD patients in Washington D.C. and many U.S. state capitals, calling awareness to the compelling value and outcomes of MAT-based telemedical OUD care for regulators and policymakers alike.
Untreated OUD-afflicted patients are believed to cost the American economy over $1.5 trillion annually. An untreated OUD-afflicted member costs U.S. health plans approximately 5.5x the medical costs of an average member annually (driven by their substantially higher rate of emergency department visits). This problem has affected state Medicaid Managed Care Organizations (“MCOs”) in particular, given the Medicaid member-heavy impact of the opioid epidemic. After years of demonstrating outstanding outcomes, including 12-month patient retention levels that are 3x the industry average, Boulder has become capable of offering Medicaid MCOs a unique solution to this problem: value-based care contracts. Moving beyond the mis-aligned incentive structures of traditional fee-for-service care models, Boulder has been able to work with an attractive roster of Medicaid MCOs under value-based care models that have enabled some of these payors to reduce their cost of care for OUD patients by over 70%.
The AVP team is excited to lead Boulder Care’s Series C financing and partner with Stephanie and the Boulder Care team to expand and improve care for an underserved population of Medicaid-covered OUD patients with a holistic, evidence-based telehealth care model and a value-based contracting approach. We are thrilled to work with Stephanie and her team in the years to come as they expand their care model nationwide and, in turn, help tackle the American opioid epidemic head-on.
Please visit the websites for Boulder Care or AVP for more information. The official press release can be found here.
