BearingOn.Health Original Contribution

April 2024

• “There are a tremendous amount of healthcare problems that need to be solved and niche digital health companies are focused on these problems. Over time, the companies consolidate to become more broad-range solution providers.”

• “I believe we will begin to see a more significant shift in the later part of 5 years, where fewer will remain independent, but most will become part of a mixture of other organizations. Some may be healthcare organizations, some may be retailers, larger IT companies, and other types of organizations we haven't thought of yet.”

• “I think there will continue, as in all sectors, to be a lot of entrepreneurs going after this space but I do think most of them will fail.”

CONSULTANTS

• “Like all ecosystems digital health has seen an explosion of start-ups in the last few years come and go, along with some well-established players who have failed. With AI now being the core of most digital health we'll continue to see start-ups but in the end, it comes down to numbers and my estimate is 2 out of 10 will survive and that follows the norm of startup survival rates.”

• “Depends on your definition of digital health. I think we will continue to see companies that help people create health for themselves, and those companies will thrive. Digital capabilities will be indispensable to these companies. We'll see direct-to-consumer solutions, wearables, digitally enabled/supplemented care delivery, and care financing companies.”

HEALTHCARE PROVIDERS

• “Digital health companies will thrive once we provide a way for them to integrate/interact with the electronic health record systems that have been able to stifle innovation since the beginning of Meaningful Use. The 21st Century Cures Act was an important first step in codifying access to patient data by innovators, and we saw a marked increase in VC investment when the draft rules were published.”

PATIENTS

• “There continue to be digital health companies. Right now we're going through a bit of a shake-out. The ones that survive will be the ones that are successful at either raising or making money. This is regardless of the health issue they are addressing. PHTI's report focused on a very thin sliver of digital health offerings (T2D using connected noncontinuous glucose monitors & receiving support digitally). It shows that an already established course of treatment can be delivered digitally and still get about the same results statistically. You'd be hard-pressed to extrapolate these results out to the rest of the digital health landscape. What goes unsaid about this study is the reasons behind why they were able to find sufficient data to analyze this particular sliver. And that is: diabetes represents a massive moneymaking opportunity. As does weight loss and obesity. These particular sectors are ripe for the culling.”

OTHER PROFESSIONS

• “Those with well-researched positive outcomes will hopefully survive IF they can be efficiently integrated into the ‘system.’ Right now such integration has too many barriers in both workflow and cost. Consider discussing the case of Better Therapeutics.”

• “Those in the diagnostic and therapeutic spaces will have the toughest time.”

• “Building”/starting a digital healthcare company was easy when there was cheap money and investors bought into using social media success factors to demonstrate the new technologies, but, healthcare is different than social media. Most successful social media companies are indeed social and involve user-developed content and the impact of influencers rather than professionally developed content and clinicians. The leap from social to professional has rarely worked and users expect their healthcare to be paid for.”

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