Teladoc Health – Product Management Confabulation

December 20, 2021

The growing power of digital healthcare: 6 trends to watch in 2022

BIll Taranto Contributor

GHI Fund President Bill Taranto has spent more than two decades in the healthcare industry and has 15 years of experience in healthcare investing. In addition to his venture investing knowledge, Bill has decades of management operations experience.

Telemedicine will change how chronic conditions are treated

The pandemic showed how telemedicine could change how we think about care interactions, with virtual visits increasing almost 40 times, according to data from McKinsey. Most of these interactions were centered around acute care. But for telemedicine to achieve its full potential, it will need to engage patients more frequently, especially for certain chronic conditions.

The companies that succeed will be the ones that change the way patients interact with the healthcare system by building their entire operation around the patient experience.

Costs around chronic care are poised to rise as baby boomers age and put greater strain on the healthcare system. One chronic condition where telemedicine will play a larger role is diabetes. That’s why Teladoc Health, a leader in the space, acquired Livongo last year for $18.5 billion.

In 2022, entrepreneurs and investors are likely to expand telemedicine into more chronic care spaces like cardiology. Today, someone in the U.S. suffers a heart attack every 40 seconds, and heart disease costs the country about $219 billion a year. Telehealth offers a convenient, cost-effective way to diagnose and treat cardiovascular disease. For instance, with telehealth, even patients in remote or rural areas can gain access to cardiologists to get treatment without traveling far.

Overall, expect telehealth players to build their offerings across the chronic care landscape in a meaningful way in 2022.

Digital therapeutics will rewrite the future of healthcare

Digital therapeutics is perhaps the most innovative development in healthcare today and has the potential to dramatically change how care is delivered. More than any other area, this is the space where I believe we’ll see the most entrepreneurial and investment activity in the coming year.

January 19, 2021

K Health expands into virtual childcare and raises $132 million at a $1.5 billion valuation

K Health, the virtual health care provider that uses machine learning to lower the cost of care by providing the bulk of the company’s health assessments, is launching new tools for childcare on the heels of raising cash that values the company at $1.5 billion.

The $132 million round raised in December will help the company expand and help pay for upgrades including an integration with most electronic health records — an integration that’s expected by the second quarter.

Throughout 2020 K Health has leveraged its position operating at the intersection of machine learning and consumer healthcare to raised $222 million in a single year.

This appetite from investors shows how large the opportunity is in consumer healthcare as companies look to use technology to make care more affordable.

For K Health, that means a monthly subscription to its service of $9 for unlimited access to the service and physicians on the platform, as well as a $19 per-month virtual mental health offering and a $19 fee for a one-time urgent care consultation.

To patients and investors the pitch is that the data K Health has managed to acquire through partnerships with organizations like the Israel health maintenance organization Maccabi Healthcare Services, which gave up decades of anonymized data on patients and health outcomes to train K Health’s predictive algorithm, can assess patients and aid the in diagnoses for the company’s doctors.

In theory that means the company’s service essentially acts as a virtual primary care physician, holding a wealth of patient information that, when taken together, might be able to spot underlying medical conditions faster or provide a more holistic view into patient care.

For pharmaceutical companies that could mean insights into population health that could be potentially profitable avenues for drug discovery.

In practice, patients get what they pay for.

The company’s mental health offering uses medical doctors who are not licensed psychiatrists to perform their evaluations and assessments, according to one provider on the platform, which can lead to interactions with untrained physicians that can cause more harm than good.

While company chief executive Allon Bloch is likely correct in his assessment that most services can be performed remotely (Bloch puts the figure at 90%), they should be performed remotely by professionals who have the necessary training.

There are limits to how much heavy lifting an algorithm or a generalist should do when it comes to healthcare, and it appears that K Health wants to push those limits.

“Drug referrals, acute issues, prevention issues, most of those can be done remotely,” Bloch said. “There’s an opportunity to do much better and potentially cheaper.

K Health has already seen hundreds of thousands of patients either through its urgent care offering or its subscription service and generated tens of millions in revenue in 2020, according to Bloch. He declined to disclose how many patients used the urgent care service vs. the monthly subscription offering.

Telemedicine companies, like other companies providing services remotely, have thrived during the pandemic. Teladoc and Amwell, two of the early pioneers in virtual medicine have seen their share prices soar. Companies like Hims, that provide prescriptions for elective conditions that aren’t necessarily covered by health, special purpose acquisition companies at valuations of $1.6 billion.

Backing K Health are a group of investors led by GGV Capital and Valor Equity Partners. Kaiser Permanente’s pension fund and the investment offices of the owners of 3G Capital (the Brazilian investment firm that owns Burger King and Kraft Heinz), along with 14W, Max Ventures, Pico Partners, Marcy Venture Partners, Primary Venture Partners and BoxGroup, also participated in the round.

Organizations working with the company include Maccabi Healthcare; the Mayo Clinic, which is investigating virtual care models with the company; and Anthem, which has white labeled the K Health service and provides it to some of the insurer’s millions of members.

September 9, 2020

Closing on $75 million in new cash, Truepill plans at-home testing service as it nears $175 million in annual revenue

Truepill, the white-label healthcare services company that provides telehealth and pharmacy fulfillment services, is adding at-home medical testing as the third branch of its services powering the offerings of companies like Hims and Hers, Ro, and other direct-to-consumer healthcare companies.

Financing this expansion of services is a new $75 million round of financing from investors led by Oak HC/FT, with participation from Optum Ventures, TI Platform Management, Sound Ventures and Y Combinator.

“With the change in reimbursement for telemedicine, it changed the trajectory of the direct to consumer companies,” said Annie Lamot, the co-founder and managing director of new lead investors Oak HC/FT. “When we talked to every one of them they all seemed to be using Truepill .”

With its expansion into lab testing, Truepill can provide a full suite of services that used to be confined to the doctor’s office remotely. As more patients adjust to remote delivery of care, these kinds of options will become more attractive.

The move to telemedicine isn’t just something for new entrants either. Incumbents are also finding that they need to provide the same care as their direct to consumer competition, especially as the priority shifts to value-based care rather than fees for services on the reimbursement side — and consumers start demanding lower cost options on the direct pay side.

“I think it enables health plans to provide better care in targeted programs,” said Lamont, a longtime investor in healthcare.

Truepill’s executives certainly hope so.

The two co-founders, Umar Afridi and Sid Viswanathan met over LinkedIn where Viswanathan cold-emailed Afridi. At the time, Afridi was working as a pharmacist filling prescriptions at a Fred Meyer near Seattle).

Initially, Truepill’s growth came from acting as the pharmacist to companies like Hims, Ro, Nurx, and other direct-to-consumer healthcare companies focused on serving the elective health needs of people who wanted hair loss treatments, erectile dysfunction medication, and birth control.

Image Credits: Truepill

As the company has grown, so have its ambitions. By the end of the year, Truepill expects to book up to $175 million in revenue, according to Viswanathan, and that revenue will come from a more evenly distributed mix of customers among direct to consumer companies, insurance companies, and healthcare providers.

“Everything we do is white labeled from our pharmacy to the lab testing component. You can go to teladoc and use that service. What we like to think early. 80 percent of healthcare is going to happen on a digital channel.. We’re in a perfect position to build the platform company in that space,” Viswanathan said.

At-home testing is a critical component of that platform. Expected to launch before the end of the year, Truepill is working with lab testing providers to offer hundreds of at-home tests. The company said it will focus on tests to manage chronic conditions like diabetes, heart disease, chronic kidney disease. Incidentally these are areas which have attracted a lot of interest from investors who are backing companies that provide direct to consumer or digital therapeutic solutions to treat or help address these conditions.

“To create a comprehensive, effective digital healthcare experience, there are three essential pillars: pharmacy with extensive insurance coverage, at-home lab testing and telehealth,” said Viswanathan, in a statement. “By adding diagnostics to our suite of solutions, we’ll be able to deliver direct-to-patient healthcare at scale through one platform – Truepill. We envision a future where 80% of healthcare is digital. With diagnostics, telehealth and pharmacy built on our foundation of API-connected infrastructure, Truepill will power that reality.”

August 14, 2020

Thirty Madison raises $47 million for its direct to consumer treatments of hair loss, migraines, and indigestion

Thirty Madison, the New York-based startup developing a range of direct to consumer treatments for hair loss, migraines, and chronic indigestion, has raised $47 million in new financing.

After last week’s nearly $19 billion merger between Teladoc and Livongo, remote therapies and virtual care companies are all the rage among the healthcare industry and Thirty Madison’s business is no exception.

An indicator of just how important these companies are to the future of the healthcare business can be seen in the presence of Johnson & Johnson Innovation – JJDC, Inc. (JJDC) in the latest round for Thirty Madison.

Existing investors Maveron and Northzone also returned to back the company in a deal led by Polaris Partners. Thirty Madison has raised a total of $70 million so far.

Founded just three years ago by Steven Gutentag and Demetir Karagas, Thirty Madison expanded from treating hair loss with its Keeps brand in 2018 to migraine treatments in early 2019 with Cove, and launched Evens (the company’s acid reflux treatment service) later that year.

Thirty Madison has just begun offering urgent care consultations for users on a pay what you will model.

And the company’s founders differentiate Thirty Madison’s business from their better-funded competitors like Hims and Ro by emphasizing that their company provides continuing care after a diagnosis and offers a range of treatment options for the conditions that the company treats. That, coupled with the more narrow focus on a few specific conditions, distinguish Thirty Madison from its peers in the industry.

“Over 59% of Americans suffer from at least one chronic condition, but few resources exist to help them connect the dots of their care,” said Amy Schulman, a partner with Polaris Partners and new director on the Thirty Madison board.