- Omada Health has acquired Physera, a five-year-old muscoloskeletal care and telehealth physical therapy company, for $30 million.
- With the buy, Omada adds video access to a licensed physical therapist network nationwide to its suite of digital services, which includes diabetes prevention and management, hypertension and mental health.
- Omada raised $57 million in a round of growth capital from life sciences investment firm Perceptive Advisors, which partially funded the deal, according to CNBC.
Unlike other providers, digital health is thriving amid the pandemic. The acquisition strengthens Omada's portfolio as loosening regulations around telehealth have refreshed investor interest in the digital health space.
Almost $10 billion in new venture capital was invested into the digital health sector globally in the first quarter of this year, up 12% from the first quarter of 2019, according to global venture capital fund White Star Capital.
Omada Health started in 2011 with digitally-administered diabetes prevention, but has since expanded the conditions it manages to Type 2 diabetes and hypertension. The player has raised more than $256 million in its nine-year run, but this is its first acquisition, according to Crunchbase.
Physera, which also includes in-app animations, voice prompts, exercises and other guidance designed to reduce musculoskeletal pain, says it reduces downstream medical costs by preventing avoidable negative outcomes down the line through its services, including prescriptions for opioids, specialist visits, surgery and imaging.
There's significant overlap between chronic conditions like diabetes and obesity and joint mobility issues, making Physera a logical extension of Omada's existing businesses. And it's a profitable market: More than half of Americans report a chronic musculoskeletal issue in a given year, and total annual spending on the conditions in the U.S. exceeds $200 billion annually, breaking down to $7,800 per patient.
Like Omada, Physera is available through employers and health plans, as well as direct-to-consumer, though Omada also contracts with major health systems like Utah-based Intermountain Healthcare.
Omada has some rivals in the nascent digital musculoskeletal sphere, however. Four-year-old Hinge Health is a digital platform offering wearable sensors and personalized health coaching for musculoskeletal therapy, digital concierge Risalto Health uses AI to connect users with musculoskeletal providers and digital therapeutics company Kaia Health has an app for conditions like chronic back pain.