Healthcare TechnologyDigital Health Primer: Healthcare Digital Transformation Is Here to Stay, Identifying LT Winners Is the KeyHealthcare Technology | CommentIntroducingDigital Health Primer. Digital health, at a high level, is a broad multidisciplinary concept that consists of the intersection between technology and healthcare. Simplistically, digital health is any process or technology that attempts to improve how healthcare is being accessed, delivered, or consumed. Given the significant and lasting financial burden of rising costs and wasteful spending, there is an increased focus on reducing costs and, more often than not, digital health is the answer. This report provides a deep dive into some of the high growth digital health verticals across healthcare services. We also discuss some of the most disruptive entities within healthcare services. COVID Hit the Accelerator on Digital Transformation in Healthcare. While telehealth got most of the focus during COVID-19, we believe the pandemic also exposed various flaws in the country’s healthcare system and underscored the argument that the status quo is unacceptable. The pandemic blurred the line between traditional healthcare and digital health. The strain COVID put on the U.S. healthcare system (and globally) heightened the need for technology and processes to enhance resource capacity. This endeavor caused a spike in the adoption and usage of various digital health platforms. The pandemic has reset the way consumers feel about, think about, and interact with healthcare providers, with expectations of higher levels of personalization and engagement.Digital Health Investing – Boom or Bust? In 2020, digital health ventures saw a year like no other - a thematic shift in liquidity for digital health venture investors, with upswings in both IPO and M&A activity. Driven by the COVID-19 pandemic, funding rose by a remarkable 72% from a record-high set in 2018, amounting to $14 billion invested across 440 deals. The IPO market also accelerated in 2H20. While valuations in the public-market have moderated from the peak, the excitement and interest remain high. As a result, there are no signs of any slowdown in digital health funding and IPO/SPAC activity. However, the volatility in valuations is likely to continue given the lack of history to compare and validate. Further, the increased market attractiveness has resulted in a wave of larger well-funded, technology and other conglomerates increasingly looking to compete in the space. Consolidation Likely to Continue. The digital health industry has also witnessed some interesting M&A deals over the past 12 months. The drivers that accelerated healthcare consolidation in 2020 have continued in 2021, and are likely to continue for the near future. We are relatively more positive on the consolidation among digital health vendors versus an insurer o...
