Daily Briefing – October 3, 2019

“Telemedicine can be defined as the process of providing healthcare services through technology, primarily through the usage of videoconferencing. Telepsychiatry is a sub-segment of telemedicine, which provides a range of mental health solutions such as therapies, including family therapy, individual therapy, and group therapy; psychiatric evaluations, medication management, and patient education. Telepsychiatry involves either direct communication between the patient and the psychiatrist or through psychiatrist supporting primary health care providers specialized in mental health. According to the National Alliance on Mental Illness, in the U.S., over 20% of youth aged between 13-18 years suffer from mental health conditions; and over 11% of the youth have a mood disorder. Similarly, over 18.1% of American adults live with anxiety disorders.”

“Digital health companies are on pace for another strong year of venture capital fundraising, with behavioral health and women’s health companies on the rise. Digital behavioral health companies have raised a total of $416 million through the third quarter of this year. That’s 8% of the overall $5.5 billion that digital health companies have raised in venture capital funding in 2019, Rock Health says in its third-quarter report. Ten women’s health digital startups brought in $177 million in funding through the third-quarter of 2019 and funding for this sector has increased 812% from 2014 to 2018. Digital health companies raised $1.3 billion in venture capital in the third quarter of 2019 and the industry is on pace for the second-largest funding year, Rock Health reported. While the third quarter saw a slightly slower pace compared to the same period in 2018. Startups in the sector are on track to raise an estimated $7.3 billion by the end of the year—1.3 times more than 2017, though short of the record $8.3 billion invested in 2018. Large deals are driving the funding trend in digital health, with investors placing bigger bets on a small number of companies, according to Rock Health. The average deal size in 2019 is $20.9 million, up 32% from 2017 and in line with 2018’s $21.7 million average deal size. Digital behavioral health—which Rock Health defines as solutions that address needs from basic mental wellness through the treatment of disease including meditation solutions— is showing signs of a maturing investment sector with. These companies are attracting more funding and larger deals with a greater number of later-stage companies.”