Rock Weekly – NEW

Who hasn’t been frustrated by medical billing, long hospital stays, or impersonal care models? The paradox consumers face is that healthcare companies don’t compete on experience—but we need the care they supply.

The scoop came last week that Amazon Care has its first enterprise contract with Precor, a Washington state subsidiary of Peloton. Amazon Care will provide Precor employees virtual primary and urgent care access, plus home visits down the line. Not to be outdone, Walmart shared its intent to move further into the D2C digital health market via acquisition of telehealth provider MeMD. Seems we cannot go a week without a significant flare up in the platform wars, this time pitting the US’ two largest companies against an already crowded field. We’re excited to see if either—or both—of these Big Retail giants can flip the normal script in healthcare by showing that bigger can be better for consumers as patients.

If you, like some of us at Rock Health, are amongst the #languishing class, let’s consider ourselves lucky. According to recent data from the CDC, 30% of U.S. adults are experiencing symptoms of anxiety or depression. So it's not surprising that last week saw big news for digital mental health. Cigna announced plans to provide Ginger as an in-network benefit for its 14 million covered lives, which came on the heels of NOCD's partnership with Tridiuum, a mental health provider platform, to make specialty treatment more accessible.

Action across the last week reinforces the fundamental pillars that will separate category winners in the raging digital health platform wars: maturing tech infrastructure to integrate consumer-centric UX that takes users from identification of need all the way through fulfillment. Accolade put competitors on notice announcing its intent to acquire virtual care provider PlushCare, thus extending its capabilities from simple navigation to providing a full care experience. Meanwhile, Hinge Health and Carrum Health are packaging their services together for employers, offering Hinge’s Digital MSK Clinic together with Carrum’s Center of Excellence bundles to guarantee spend in the high cost MSK category. And with its all-cash acquisition of medical education company Healthination, the value prop of GoodRx's Gold membership extends from diagnosis and now, education—to prescription, discounts, and at-home delivery.

Raise your hand if, at some point over the past year, you asked yourself, “Exited via SPAC...what now?”—and then watched as a single SPAC headline gave way to many more, infiltrated your digital health news feed, and eventually turned into a Full. Blown. Thing.

What a difference a decade makes. In 2011, we recorded $1.1B in funding. Fast forward to Q1 2021, and we’re seeing $1B+ in a week. With $6.7B across 147 deals, Q1 2021 just closed as the biggest funding quarter ever. Average deal size ballooned to $45.9M (up from $31.7M in 2020), and SPACs continue to offer a path to liquidity, with 10 announced or closed SPAC deals. With growing deal sizes, an accelerated pace of funding rounds, and new exit pathways—we’re in a unique moment for digital health. Read our Q1 funding recap for more on how digital health is all grown up.

Amazon Prime conditioned us to on-demand everything. And spurred by the pandemic, healthcare at large has followed suit. Uber Health’s new deal with ScriptDrop will now enable prescription delivery in 37 states; Everlywell announced two acquisitions to expand their at-home lab testing services; and food delivery company DoorDash is partnering with Everlywell and Vault Health to deliver at-home COVID tests to consumers in major cities. Not to be outdone, following this news Amazon announced authorization of its own at-home COVID-19 test. Cue the battle for delivery domination—it's hard to bet against Amazon, but with the quick growth and partnerships of nimble startups, let's hope the real winners are consumers. 

A year ago last week, the pandemic was declared a national emergency. 365 days later, the explosion of digital health funding that ultimately followed shows little sign of abating. With four mega deals announced within 48 hours last week—equating to a total of $805M in funding—Clarify Health, Unite Us, Strive Health, and Insitro’s fresh rounds represent a healthy proportion of the total funding raised so far this year. All told, the first quarter of 2021 is on track to close with more than double the number of mega deals compared to Q1 and Q2 of 2020 combined.

Even as vaccination numbers accelerate and the US edges closer to a more hopeful chapter in the pandemic saga, the psychological effects of 2020 won’t soon be forgotten. Investors were not lost to this realization—which resulted in $2.4B of funding poured into the digital behavioral health market last year. Our latest piece explores four trends underpinning this market's momentum, plus opportunities for entrepreneurs and investors alike to consider as the industry moves forward.

Who isn’t vying to own the home healthcare market? An array of major players—including Amazon Care, Intermountain, and Ascension—are teaming up to advocate for policy changes to designate the home as a site of clinical service. Policy changes could open new reimbursement and access opportunities, but in the meantime, enterprises and startups alike are rapidly expanding their at-home offerings: Best Buy Health is partnering with Apple Watch to offer on-demand health assistance, Walgreens expanded its Find Care platform to connect consumers with digital health services, online pharmacy Ro is now vaccinating seniors in their homes, and a recent study showed reduced lower back pain from home-based therapeutic VR.