Driven by the New Drug entities and innovations, drug manufacturers dominated most of the 1980-1990s. And the space soon got crowded and moved to reach a saturation. Come 2020, COVID-19 strikes the world and the entire healthcare space once again comes under the spotlight, but this time the drivers are different. Technology-driven delivery and services space catering to the co-markers of health – such as prevention, nutrition, fitness, mental health among others. Alerted masses, started seeking convenient healthcare services. This, coupled with innovations on the technology front such as smartphones, high-speed data connectivity and virtual/augmented reality tools, made the sector a darling of investors seeking to build wealth out of health!A Rockhealth report from October 2021, revealed that investments in digital health crossed $ 20 billion till Q3 of 2021, double of $ 10B received in 2020. More is promised to come. Between Q1-Q3, total 541 deals were made averaging the total deal size of $39.4 Million.DistilInfo FastFive:1. In the eye of entrepreneurs:Catching the investors attention are the areas of interoperability, data management, at-home care, virtual consulting, emerging benefits and fitness counseling. Investors see these IT tools creating a health-tech infrastructure for delivery. Covid has fueled the growth of app-based consultations as people preferred avoiding in-person visits to the clinics and healthcare delivery centers. In addition to this, a large number of App-based fitness training and mental health programs started flooding the market as more and more people – age no bar – started focusing on physical and mental fitness. Further, a big push is witnessed for medicine delivery aggregators. Just as online food ordering, online ordering of medicine started gaining traction as more people found it convenient as well as safe in the pandemic times. Companies providing medicine delivery platforms found it organic to offer self-diagnostic tools and equipment creating an additional market for themselves. Data integration, tech tools and AI also helped hospitals and private practitioner general physicians to track the pattern of their patients. A good number of patient data management apps and digital solutions for administrative purposes is finding new takers.2. Capturing the transformation:COVID-19 has triggered a transformation of healthcare space. Startups are quick to board the train. From public health to personal health, there is a changing perception towards delivery of healthcare services. Safety, accuracy and affordability are the three key factors influencing the decision of healthcare service seekers. Even as technology assures safety and accuracy, the affordability is ensured by growing competition, innovation and large volumes of users. But the challenge lies in keeping the boat afloat, achieving profitability and ensuring return on investment for the investors.3. Money matters:Healthcare startups witnessed huge inflow of funds between Q1-Q3 of 2021. The total funding amounted to $21.3B involving 541 deals so far in the three quarters of the current year. Comparing this with a five-year-ago period, the number of deals have grown by 58% from 342 in 2016 and total funding is up a phenomenal 363% from $4.6B! The average deal size is up 192% from $ 13.5M to $39.4B. RockHealth analysis shows 2021’s funding swell is “empowering investors to ‘venture’ outside of historical funding patterns, with more dollars going toward women-led companies, women+ digital health,2 and health equity solutions.” More investors are showing inclination towards opportunities in mental health. “Digital mental health funding was boosted by Q3 deals from behavioral health provider marketplace SonderMind ($150M) in July and mental health unicorn Spring Health, which received a $2B valuation after a $190M Series C in September,” RockHealth reported.4. Technology making life easier:Technological interventions through Artificial Intelligence (AI), Machine Learning (ML), Augmented/Virtual Realities (AR/VR) and big data tools feed these digital health-tech startups. The consumer-focused digital interventions come in the form of mobile apps or web portals. But there are institutional applications of these tools, which is making administration, planning and execution of healthcare services easier for the hospitals, institutions and private practitioners. These institution-focused interventions address specific needs of therapeutic areas. A majority of the tech-based interventions are found to be deployed in radiology, while a smaller portion is finding space in cardiovascular, neurology, hematology, pathology and dental care. These therapeutic areas increase the use of AI/ML-enabled devices.5. Potential employment jackpot:Conventional healthcare and pharmaceutical businesses offered limited avenues for employment opportunities with some specific roles in R&D, manufacturing processes, administration, sales and marketing. However, the health-tech space today offers job opportunities in the newer areas of IT, data analytics, AI and ML specialists besides the conventional roles. Also, the hiring is far more inclusive and wider in geographic coverage. Job profiles include planning to evaluation, and execution to manufacturing or marketing. the big money backing the startups, they don’t shy-away in picking the right talent with best in class packages. This has further fueled interest to acquire new-age specialized tech qualifications.Summary:Digital health funding has been on the rise over the past one decade. Out of the total funding of $ 77.7 B received by healthtech startups between 2011 and 2021, about half or 36B is committed during the past two years of 2020, 2021. This shows the growing thrust towards health-tech adoption and the channelization of the funds towards IT-enabled healthcare delivery systems. As the present appears far better than the past, the trend holds a promise for a better future.
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