WellDoc, which sells a type 2 diabetes interactive management program on a mobile device, raised $20 million from Merck Global Health Innovation Fund and Windham Venture Partners. “Big pharma is starting to understand that they need to move from a widget sale to a solution sale to support patients holistically,” says Ryan Sysko, a founder and chief executive of WellDoc. “It [Merck investment] signifies a transition of what it takes to manage a chronic condition.”
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While health apps have proliferated, few can prove that their products deliver results. Co-founded by Sysko’s sister, an endocrinologist, WellDoc can. It has published results of a randomized clinical trial, showing a decline in blood sugar levels.
This past June, the company’s product BlueStar became the first disease therapy to be prescribed through an app, gaining coverage from health plans. A pharmacy gets the doctor’s prescription, adjudicates the claim, and forwards it to WellDoc, which sets up BlueStar for patient and doctor. The newly raised funds will enable the company to hire a nationwide salesforce to market to doctors, and trainers who teach patients to download BlueStar on a smartphone or laptop, and use it.
WellDoc previously raised $35 million in debt and equity from angel investors, with $17 million coming from Stewart Greenebaum, a patient of Suzanne Sysko. For ten years, Greenebaum struggled with a high blood sugar level. Within 60 days, he was able to lower it significantly with the help of WellDoc, making him a believer. He also advised the company to shun venture capitalists, who for the most part didn’t understand products that blend technology and life science.
One corporate investor that gets it is Merck. With its investment in WellDoc, Merck continues its streak as one of the top investors in digital health, and the only pharmaceutical company with a dedicated fund for this sector, with $500 million under management. Since 2010, it has made more than 20 investments in digital health companies.
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