“The record breaking funding year continues for digital health companies. The 227 funding deals in Q3 was the most ever for a single quarter. Third quarter was all about Data Analytics with companies garnering almost a third of the funding in Q3 and artificial intelligence companies receiving more than $200 million,” commented Raj Prabhu, CEO and Co-Founder of Mercom Capital Group.
Healthcare practice-centric companies received $731 million in 78 deals, accounting for 49 percent of the funding in Q3 2017 compared to $745 million in 63 deals in Q2 2017. Consumer-centric companies accounted for 51 percent of the funding in Q3 2017, raising $751 million in 149 deals compared to $1.6 billion in 131 deals in Q2 2017.
The top funded areas in 9M 2017 were: Data Analytics with $1 billion, Patient Engagement Solutions with $686 million, mHealth Apps with $549 million, Telemedicine with $529 million, Booking with $407 million, and Mobile Wireless with $407 million.
There were 69 early stage deals in Q3 2017, including 29 accelerator and incubator deals.
The Top VC deals in Q3 2017 included: $165 million raised by WuXi Nextcode, $75 raised by M2Gen, $70 million raised by Tempus, $37 raised by AbleTo, and $34 million raised by HealthEdge.
A total of 401 investors (including seven accelerators/incubators) participated in funding deals in Q3 2017 compared to 454 investors in Q2 2017, of which two were accelerators/incubators.
Healthcare IT VC funding in Q3 2017 was distributed across 26 countries.
In the first nine months of 2017 there were a total of 146 Digital Health M&A transactions compared to 163 transactions in 9M 2016. There were 56 Digital Health M&A transactions in Q3 2017 compared to 41 in Q2 2017.
Healthcare IT Service Providers were involved in seven M&A transactions in Q3 2017. Healthcare IT Consulting companies and Telemedicine companies had five transactions each.
Notable M&A transactions in Q3 2017 included: health information provider WebMD’s acquisition by KKR portfolio company Internet Brands for $2.8 billion; the acquisition of the healthcare technology and consulting business of Advisory Board Company by Optum for $1.3 billion. Konica Minolta acquired Ambry Genetics Corporation for $1 billion; Navicure acquired ZirMed for $750 million; FNFV Group acquired T-System for $200 million; and Allscripts acquired McKesson’s EHR and revenue cycle tools for $185 million.
To learn more about the report, visit: http://bit.ly/MercomDigitalHealthQ32017Funding
