#GoodMarkets_02: Digital Health
Original Publish Date: Aug 8, 2022 on Revue
TL;DR 💚
We cover everything from digital health diagnostics in sleep, to IP strategies specific to this market. We briefly wade into lab-on-a-chip opportunities to publicly sourced questions around excitement and skepticism.
Digital Health Market
The pandemic created massive opportunities for Digital Health startups serving people working and living remotely. And this trend will likely continue, given the adaptation of mHealth, telemedicine, wearables, including smart phone apps, and implant technologies (see: lab-on-a-chip) for both treatment and monitoring with the advancement of highly accurate tinier chips.
The global digital health market was valued recently at $175.6B, and is projected to grow at a compound annual growth rate (CAGR) of 27.7% to 2030. According to GrandView Research. Telehealth is expected to capture more than 80% of the market.
Increasing smartphone penetration, improving internet connectivity, advancing healthcare IT infrastructure, growing healthcare expenditure, rising prevalence of chronic diseases, increasing demand for remote patient monitoring services, and increasing accessibility of virtual care are driving market growth.
There are many overlaps within Digital Health relevant to impact verticals such as mHealth, wearables, smart devices and apps, telemedicine, and implant technologies. Globally, the mHealth market size was valued at $50.7B in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 11.0% from 2022 to 2030, according to GrandView Research. The wearables market is on track for $380.5B by 2028, and a CAGR of 18.5%, according to CB Insights. Within the implant market — where some technologies have a digital health offering, $147B market is expected by 2027, with a CAGR of 7.2%. Within telemedicine, the market is expected to grow to $397B in 2027 at a CAGR of 25.8% according to Fortune Insights.
Opportunities & Issues
What are the moats in the digital health market?
There are many patent, copyright, and trademark approaches worth looking at. This article by Lexology, points to many of the nuances for Founders looking to adapt their startups to an evolving competitor set.
A key patentability consideration of digital health inventions is subject matter eligibility under 35 USC § 101. The Supreme Court has held ‘abstract ideas’ are not patentable, but ‘inventive concepts’ are. Subject matter eligibility under section 101 remains in flux with the USPTO and federal courts seemingly contradicting one another or themselves at times.
In regards to ethics, impact, and potential threats to the market. These are the crowdsourced issues which have been associate with Digital Health:
- The ownership of health data issue
- Misinterpretation of data
- Institutional ageism
- Digital divide
- Bio-surveillance
- Lack of existing regulation
WIKI: Digital Health
The ownership of health data seems to be interesting, as we move to web3 opportunities and real time analytics. We may need to see an increase in L2 technologies at scale — e.g., on the Etherium network. Another variation on the misinterpretation of data is the OHCHRs discussion of the-right-to-health
- Accessibility: Health facilities, goods and services must be affordable, within reach physically and on the basis of non-discrimination.
- Availability: Functioning public health and health-care facilities, goods and services must be in sufficient quantity.
- Acceptability: The facilities, goods and services should respect medical ethics, and be gender-sensitive and culturally-appropriate.
- Good quality: Health facilities, goods and services must be scientifically- and medically-appropriate, and in good working condition.
- Participation: Health care beneficiaries should have a voice in designing and implementing health policies which affect them.
- Accountability: Providers and States should be held accountable for meeting human rights obligations for public health. People should have the possibility of seeking effective remedies for violations such as the denial of health services.
- Freedoms: People must be free from non-consensual medical treatments, such as medical experiments or forced sterilization; torture; and other cruel, inhuman or degrading treatment or punishment.
- Entitlements: People are entitled to the opportunity to enjoy the highest attainable level of health; the right to prevention, treatment and control of diseases; access to essential medicines; and maternal, child and reproductive health, among other entitlements.
Based on my initial research here, I started thinking more about implant technologies and this emerging area of lab-on-a-chip, and sent out a poll to users about this area. Could be interesting to explore this topic in full in future articles.
Fell across one opportunity in the sleep diagnostics space, Onera Health (Lab-on-Chip), recently closing it’s Series B within the implant market.
Major Exits
The majority of larger exits happened within the market around the start of 2019, with the most recent sizable exit by ViaCyte at $320M in July of 2022 — note their diabetes implant technology. The exit of Livongo in 2019 of $18.5B by Teladoc Health (now valued at $6.7B market cap), and is an awesome win for the industry — within the areas of diabetes, blood pressure, and weight. I think we’ll continue to see new entrants scale in the healthy eating and weight categories.
Recent Closes
- Diversity: Women Founded
- Verticals: Fitness, Health Care, Wellness
- Description: A nationwide telehealth platform of clinical pharmacists delivering comprehensive medication management.
- Top 5 investors: Cardinal Health, Dreamit Ventures, SeedFunders Orlando, SpringTide Ventures
- Total Raised: $8,7M
- Series A close $5M (7/26/2022)
- Founded in 2017
- Verticals: Fitness, Hardware, Rehabilitation, Sports Fitness & Physical
- Description: Rehabilitation technology designed to optimize movement using 3D resistance training and analytics.
- Top 5 Investors: Blake Griffin Enterprises, John Lester, Hospital for Special Surgery, Lauder Partners, Harris Blitzer Sports & Entertainment
- Total Raised: $15.3
- Series A close $8.5M (7/20/2022)
- Founded in 2016
- Verticals: Fertility, Health Care, Wellness
- Description: Posterity Health educate, engage, and encourage couples to approach the conception process together as an integrated unit.
- Top 5 Investors: Distributed Ventures, Laurie McGraw, Gerry McCarthy, Don Holzworth
- Total Raised: $6M
- Seed close $6M (7/12/2022 )
- Founded in 2021
- Diversity: Women Founded, Women Led
- Verticals: Personal Health, Wellness, Women’s
- Description: August is a lifestyle period brand dedicated to reimagining periods to be powerful.
- Top 5 Investors: SoGal Ventures, The Fund, Bullish, Rose Street Capital, Hannah Grey
- Total Raised: $5.6M
- Seed close $3.7M (5/25/2022)
- Founded in 2020
Exit Data Source: Crunchbase
Thanks!
Copyright 2022, All rights reserved, Zecca Lehn @posi2ive. No advice given here (e.g., financial / legal / business / other). All views expressed represent those of the author personally at the time of writing, and not those of any external business entity nor organization.
