Digital Health Investment in September Tops $700 Million

Fenwick & West Life Sciences Group

Digital health companies raised just over $730 million through venture, private equity and angel investments in September, according to our latest analysis, bringing the total for the third quarter to approximately $1.3 billion.

The largest financing in the third quarter accounted for more than half of the aggregate investment in September. Privia, a practice management and population health technology company, received a $400 million Series C investment from Goldman Sachs. The Washington Post reports that the software company, which helps doctors communicate with patients, particularly those with chronic conditions, and other caregivers, will use the money to expand outside its base of users in the District of Columbia area.

The second largest investment was raised by telemedine provider Teledoc. The Dallas-based company received $50 million in a Series F round. Kleiner Perkins, HLM Ventures, Cardinal Partners and JAFCO participated in the round.

HealthEdge, a provider of cloud-based financial, administrative and clinical software for healthcare payers received the third largest investment in September. The Burlington, Mass.-based company raised $30 million in a Series C financing led by Psilos Group.

Fenwick client iHealth Labs received a $25 million Series A investment from Xiaomi Ventures in the fourth largest investment of the month. The Mountain View, Calif.-based company aims to make it as easy as possible for people to take a more active role in managing their health and produces a variety of mobile personal healthcare products that connect to the cloud.

The fifth largest investment was in Sandlot Solutions, which provides an electronic medical records interoperability, big data analytics and population health management platform. The company received a $23.3 million equity capital investment from Lemhi Ventures, North Texas Specialty Physicians and Santa Rosa Consulting.

Fenwick client Netpulse’s $18.6 million Series D round was the sixth largest investment of the month. The software developer provides an enterprise-level platform for fitness centers that connects with consumers at multiple touch points both in the facility and outside the gym. August Capital, Docomo Capital, DFJ Frontier, Nokia Growth Partners and Javelin Venture Partners participated in the round.

Palo Alto internet software company Jiff received the seventh largest investment of the month, an $18 million Series B round. The company has developed a HIPAA compliant platform that connects employee benefit design to consumer digital health technology. The round was led by Venrock with participation from Aberdare Ventures and Aeris Capital.

The eighth largest investment was in Instamed Communications, which raised $15 million in growth equity capital from Actual Corporation, Osage Partners and JNTC Venture Fund. The Philadelphia-based company allows payers to cut settlement and disbursement costs with electronic payments.

A third Fenwick client, Propeller Health, received the ninth largest investment of the month with $14.5 million in a Series B round. Based in Madison, Wisc., Propeller provides a mobile platform for respiratory health management that tracks when and where patients use medication so patients, physicians and caregivers can better manage symptoms. Safeguard Scientifics, Kapor Capital and Social+Capital participated in the round.

Rounding out the top 10 investments for September is a $13 million growth equity investment in Array Health. The Seattle-based company has developed a retail health insurance exchange through which employers can provide their employees a wide choice of health plans while still controlling cost. Noro-Moseley Partners and Vocap Investment Partners participated in the round.

This article was first published on the Network on November 5, 2014.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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