Report: 2015 venture capital digital health deals topped $4.3B
- San Francisco-based venture fund Rock Health released a year-end report that found the number of venture capital-funded deals in health IT dropped somewhat this year to 278 from 294 in 2014.
- However, the average dollar amount per deal was higher at $15.6 million than in 2014 ($14.7 million), due to investments in more mature companies.
- Mergers and acquisitions doubled this year to 180 deals with the Allscripts-NantHealth deal ranking as the largest deal of the year in digital health. NantHealth gained $200 million in new funding, with a total amount raised to date of $680 million.
Deals in healthcare consumer engagement topped the company's six digital investment categories with $613 million invested this year.
There were more than 330 venture capital firms that invested in at least one digital health deal in 2015, according to the report. In addition, digital health continues to account for 7% of total venture funding. Two of the six largest deals this year were by consumer-driven genetic companies, 23andMe and Helix, both deals reaching at least $100 million.
Three areas with noticeable growth in funding this year include personal health tools and tracking, care coordination and life sciences technologies. "As the industry faces growing pressure to cut costs, digital health will play a key role in enabling engagement with the end-user and improving communication and coordination," the report summarized.
"The steady amount of funding should calm any concerns of a bubble. Digital health is no longer a novelty as well. We're seeing company growth, with late stage deals accounting for just over 25% of all deal volume," the authors wrote.