INSIGHTS
January 8, 2024

2023 year-end funding: $10.7B raised across 492 deals

We expected 2023 to be a year of less capital for digital health startups, and it was—with $10.7B raised across 492 deals, 2023 was the lowest year of U.S. digital health investment since 2019. Yet, common measures that accompany a cooling funding market, such as downrounds, shutdowns, and acquisitions, didn’t spike. How come?

Ultimately, last year was defined by startups leveraging creative measures to avoid those difficult steps. Companies used extension and insider rounds as interim measures to shore up cash. And unlabeled rounds (i.e., not labeled with a letter, such as “Series B”)—which delay the pressure to meet expectations associated with the next labeled raise—made up a whopping 44% of 2023’s deal count, a new annual record.

But transition measures can’t buoy startups forever. While the economic climate of 2024 remains uncertain, some delayed activities like acquisitions, public exits, and sales are likely on the docket. Read our year-end 2023 funding recap to understand what 2023’s funding patterns mean for 2024.

Headlines

Cigna Nears Deal To Offload Medicare Business
Health insurer in exclusive talks to sell MA business to HCSC for $3-4B The Wall Street Journal

Lilly Launches Website, Home Delivery Option For Weight-Loss Drug
LillyDirect will connect consumers to telehealth providers for obesity, diabetes, and migraine care Reuters

Novo Nordisk To Open New AI Hub In UK For Drug Discovery
London location will attract talent across AI, data science, and engineering PharmaTimes

ChatGPT Incorrectly Diagnosed More Than 8 In 10 Pediatric Case Studies
Generative AI needs more tuning to address pediatric health nuances The Hill

Medical Devices Could Be Hacked Next, Officials Fear
Even with new FDA measures, device vulnerabilities raise concerns Axios

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