Whatever you think of mobile health – too little doctor care, too much do-it-yourself but just right (fewer) doctor visits – it’s certainly making a lot of money.
Brian Dolan reports that in July alone, $138 million in investment deals were done: $61 million for ClearPractice’s parent company, $35 million for a sleep device maker, and a $25 million investment by Dr. Patrick Soon-Shiong and Toumaz. And that’s not even including the $1.1-billion acquisition of MModal by a JPMorgan Chase & Co. (JPM) equity unit this week.
A new survey from health apps incubator Rock Health found that venture capital interest in digital health is “skyrocketing” since 2010, when there were 138 healthcare technology investment deals – up from 52 such deals in 2005, Dolan wrote.
The survey also found that early stage digital health entrepreneurs aren’t building business-to-business (B2B) companies, but are selling directly to consumers, even with all the investment millions flowing to B2B. Sixty percent of the startups plan to have consumers pay for their product, while 30 percent said hospitals would, according to Dolan.
Another 26 percent expect employers to pay, and 22 percent have advertisers pay for it.
One hesitation on the part of investors was “a lack of regulatory guidance from the FDA.” But the FDA is now proposing a rule to establish a medical device identifier, called unique device identifiers, or UDIs. Reports said the FDA said device makers, like Boston Scientific Corp and Medtronic Inc., now will need to put a special code – much like the bar codes we see in the grocery store – on most of their products, “starting with the riskiest, like implants or pacemakers,” according to the source.
According to another story by Dolan, investors pumped $100 million into the industry in first quarter. Medcitynews.com noted that Rock Health’s survey, which brought together all the digital health companies receiving at least $2 million in investment, shows those deals are up 73 percent at this point compared to 2011, culminating in $675 million in digital health investments through June, relative to $390 million at this point last year.
Edited by
Braden Becker
