MEDICINE TELE-SECTORS- TELE-TECHNOLOGIES AND NEW OPPORTUNITIES FOR PATIENTS – PART TWO

SECOND PART- TRENDS AND DEVELOPMENT OF SPECIFIC TELEHEALTH SECTORS

Sectoral legal advice for clients from the telemedicine sector requires from lawyers to constantly monitor the market in this sector and constantly expand their knowledge of market needs. It is the duty of every lawyer of KIEŁTYKA GŁADKOWSKI to be up-to-date with the sector of economic activity on which they provide legal services. Proper legal advice requires from lawyers to know the market practice of a given sector, and above all, knowledge of complex IT terminology and the basics of the pharmaceutical market.

I Telehealth trends’ perspectives

On the Telehealth Investment Trends we can have a look from different perspectives.

1. One of these perspectives is a funding perspective. In the 2^nd quarter of 2021 we can notice a funding record broken for the 4^th quarter in a row (from the 3^rd quarter of 2020). The deal count amounted 163 deals and the funding amounted 5,038 (in millions of dollars).
2. The continental differences. It is explicitly noticeable that European investment nearly quintupled QoQ to reach a record high of $915M. Asian investments almost halved, north American investment slightly increased but European made an incredible investment growth which might be a long-perspective tendency (especially regarding the COVID-19 pandemic and Europe’s ageing an increasingly digitalized society). Among these reasons and investment tendencies the polish executive in the abovementioned ordinance included the procedures to impart instructions about e- medical prescription realization, additional treatment, tests realization (including laboratory tests) and possibility to sign up an Online Patient Account[1]. These procedures and medical services requirements can be (and in deed will be for sure) unquestionably helpful for older people who are yet to learn with increasingly used IT systems.
3. The differences between early-, mid- and late- stage deal percentage. It is worthy to notice that in the 2021 early-stage deal share tracked at a historical low but at the same time the late-stage share at its high level (12% in comparison to previous 8%). This may reflect the increasing sophistication and maturity of the telehealth industry and of course the maturity and investment development and advancement of telehealth entities.

As a titbit we can say that the top 3 deals in Q2’21 brought in $1.6 B. The companies engaged in these transactions are Noom, Kry, Capsule, Cue and Lyra and each of them have a total disclosed funding above $570M.

• A broad domination of teletherapy. In the relation between 1^st and 2^nd quarter of 2021 the teletherapy sector (teletherapy, coaching &care management) has reached the highest increase (form 26% to 37%). It means that teletherapy deal share neared 40% in Q2’21. It is the biggest part of that industry brunch (almost an half). That’s why polish minister decided to regulated the teleconsultation in the individual ordinance (because the statutory law obliged him to do so. Thus we can say that the polish legislator decided to regulate this important issue in the individual act and ordinance).
• For the experts of capital markets law and company law it might be interesting that telehealth exits reached a record high in Q2’21, driven largely by M&A activity (35 in comparison to 7 IPO excluding SPACs).
• To give more detailed information it is good to notice the selected telehealth acquisitions from Q2’21:
• Telemedicine providers- Walmart Health acquired virtual primary care provider MeMD; Accolade acquired virtual primary care company PlushCare
• Virtual care enablement- Insurer Bright HealthCare acquired virtual care enablement company Zipnosis, eConsult acquired fellow UK-based virtual care enablement company Q doctor.
• Remote monitoring- PAVmed acquired connected vascular implant maker Oncodisc, Halma acquired obstetric remote monitoring software developer PeriGen.

Globally there are 27 TELEHEALTH UNICORNS. VALUED IN AGGREGATE AT $55B.

If you want to see telehealth’s most active VC investors: see the full report.[2]

II What the state of telehealth covers

• TELEMEDICINE PROVIDERS, PLATFORMS, & MARKETPLACES

Companies that offer online access to and facilitate interactions with remote healthcare professionals. These interactions — whether between a patient and a physician or between physicians — are generally ad hoc and consultative in nature.[3]

In the Q2’21 we could have seen the first quarter to quarter decline. In comparison to the previous 6 quarters increase it could be only a temporary decline. In the next quarters we should carefully observe these data.

Precisely because of the telemedicine providers (considering the temporary decline) polish legislator decided to oblige the Minister of Health to introduce the appropriate ordinance regulating teleconsultation which are operated and provided by platforms such as Kry company, Cure.fit, Doktor.se, etc.

• TELETHERAPY, COACHING, & CARE MANAGEMENT

Companies that offer online access to and facilitate interactions with professionals like remote therapists, health coaches, care managers, and patient advocates who provide periodic, instructive guidance and encouragement throughout patients’ treatment plans and care pathways.[4]

This sector (in the era of mental-disease as a civilization (lifestyle) disease) is accelerating very rapidly (especially in the 1^st and 2^nd quarter of 2021, perhaps due to the pandemic). It is significant that top deals went to mental health and chronic car cos. This is one of the reason why in the abovementioned ordinance are the exceptions from the online doctor consultation. When the mental state of the patient is severe it is a possibility and even and obligation to make an in-office visit.[5]

Recently the Cerebral became a telemental health unicorn, which total funding is $162m and valuation is $1.2B.[6]

• VIRTUAL/DIGITAL CARE ENABLEMENT

Companies offering software and connectivity solutions to physicians and healthcare enterprises looking to build out virtual/digital patient interaction and remote care collaboration capabilities.[7]

This sector is a little bit different from others, because its funding hit a high as deals rebounded from 1^st quarter of 2021 (other sectors or peaked or have declined in the 2^nd quarter of 2021). The main highlight in this subject is an issue of decentralized clinical trial enablement which was an active area of business development activity.

One of the most known acquisition in the digital care enablement was an Zipnosis acquisition by the bright Health.

Zipnosis’ white-label enterprise virtual care suite combines virtual triage & routing with synchronous & asynchronous telemedicine solutions to help healthcare organizations reduce costs and improve outcomes. According to the company, Zipnosis has screened and treated more than 2M patients.

In April, health insurer Bright Health acquired Zipnosis for an undisclosed sum to strengthen its position in the telehealth market. In June, Bright Health IPO’d at a $13.4B valuation.[8]

• REMOTE MONITORING & DIAGNOSTICS

Companies offering products that help assess patients’ state of health and well-being from a distance. Whether to monitor for signs of deterioration, screen for disease risk, or diagnose conditions, these solutions differ in the types of data they analyze and the manners in which they collect and share it.[9]

This sector has the same investment and economic success as other sectors. But aforementioned ordinance does not relate to it in a explicit way.

• TELEPHARMACY

Telepharmacy sector held strong in the 2^nd quarter of 2021 despite the 43% decline quarter to quarter. It is probably caused by still persisting public awareness about COVID. News articles mentioning telepharmacy solution are still at the same (high) level as there were at the beginning of Covid pandemic. The index has not peaked, but it remains at a stable, high level.

Telepharmacy is mainly concerned with instructions on e-prescribing and issues that take place outside and after the online doctor consultation. It demands another, detailed and individualized regulation about its specification, in which investment sector is still (as we mentioned above) strong and the pandemic time will remain that rate at the significant level.

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[1] Section 3 point 1 letter f of the Minister of Health Ordinance from 12^th August 2020, https://isap.sejm.gov.pl/isap.nsf/DocDetails.xsp?id=WDU20200001395, https://isap.sejm.gov.pl/isap.nsf/download.xsp/WDU20200001395/O/D20201395.pdf (data access: 3^rd August, 2021). 

[2] To get full report: https://www.cbinsights.com/research/report/telehealth-trends-q2-2021/ (data access: 3^rd August, 2021).

[3] State Of Telehealth Q2’21 Report: Investment & Sector Trends To Watch, CB Insights Report, 29 July, 2021, p. 37. To get full report: https://www.cbinsights.com/research/report/telehealth-trends-q2-2021/ (data access: 3^rd August, 2021).

[4] Op. cit. p. 37

[5] Section 3 point 1 letter e of the Minister of Health Ordinance from 12^th August 2020, https://isap.sejm.gov.pl/isap.nsf/DocDetails.xsp?id=WDU20200001395, https://isap.sejm.gov.pl/isap.nsf/download.xsp/WDU20200001395/O/D20201395.pdf (data access: 3^rd August, 2021). 

[6] Cerebral is a telepsychiatry company that offers online provider visits, care counseling, and prescription management services for people with anxiety and depression.

State Of Telehealth Q2’21 Report: Investment & Sector Trends To Watch, CB Insights Report, 29 July, 2021, p. 41. To get full report: https://www.cbinsights.com/research/report/telehealth-trends-q2-2021/ (data access: 3^rd August, 2021).

[7] ^[7] State Of Telehealth Q2’21 Report: Investment & Sector Trends To Watch, CB Insights Report, 29 July, 2021, p. 37. To get full report: https://www.cbinsights.com/research/report/telehealth-trends-q2-2021/ (data access: 3^rd August, 2021).

[8] State Of Telehealth Q2’21 Report: Investment & Sector Trends To Watch, CB Insights Report, 29 July, 2021, p. 52. To get full report: https://www.cbinsights.com/research/report/telehealth-trends-q2-2021/ (data access: 3^rd August, 2021).

[9]  State Of Telehealth Q2’21 Report: Investment & Sector Trends To Watch, CB Insights Report, 29 July, 2021, p. 37. To get full report: https://www.cbinsights.com/research/report/telehealth-trends-q2-2021/ (data access: 3^rd August, 2021).