Capital Raising Activity

Menlo Park, CA based Grail raises over $900 million From Amazon, Bristol-Myers, Merck, Johnson & Johnson and others

Grail is a spinoff of Illumina, the largest provider of genomic analytical tools in the world. Grail is a liquid biopsy company that is working on developing early cancer detection technologies.

The momentum behind liquid biopsies is unprecedented. We all know that cancer is a traumatic and costly disease so prevention or early detection will save our system trillion of dollar overtime. This is a significant shift from risk-driven diagnostics to routine screening of healthy population. Let’s hope that insurers will see the light and start reimbursing these tests.

Freenome, based in San Francisco, CA raises $65 million in Series A

Freenome is another liquid biopsy company for early detection of cancer. The company raised over $5.5 million from Andreessen Horowitz and others in June of 2016. The new round includes Allen & Company, Polaris, the Founders Fund amongst others. Freenome relies on machine learning to identify what signatures are most relevant to early detection. Grail, on the other hand, uses high intensity sequencing tools alongside population-scale clinical trials and computational power to arrive at its results.

Warburg Pincus invests $115 million in Alignment Healthcare based in Orange, CA

General Atlantic, one of the most respected names in the PE industry, originally invested $125 million in the company in April of 2014.  Alignment establishes partnerships with a variety of provider organizations. Services include end to end care programs comprising of clinical care coordination, risk management and IT enablement. The company has a sophisticated methodology for risk taking spanning the assumption of full risk for clinical outcomes, on one hand, to outsourcing contracts similar to care-as-a service- taking very little clinical risk. 

Livongo, based in Mountain View, CA receives $52.5 million in Series D led by General Catalyst and Kinnevik bringing total funding to $145 million

This is a similar company to Omada Health; both trying to tackle diabetes patients. The company combines remote monitoring with live coaches for effective disease management. With the new funds, the company plans to move into other chronic diseases and also expand internationally. One of the reasons we like Omada is because the company has invested substantial resources to validate its results via third parties; probably the main reason behind being granted a reimbursement code from Medicare (a big deal indeed). We will watch Livongo’s progress with much interest.

Amino Inc. based in San Francisco, CA raises $25 million bringing the total funding to $45 million

The round was led by Highland Capital. Amino combines search for doctors with price transparency and appointments all in one website. The roots of the company are in the consumer space, but as we all know,

the real opportunity is with payers, IDNs and self-insured employers and that is where the company is headed. This is a very crowded space. We are not sure how Amino plans to differentiate themselves. At the end of the day, ease of use, data quality and depth as well as pricing will set apart the winners from the losers in this space.

AliveCor secures a $30 million round of funding from Mayo Clinic and Omron Healthcare

The company had already raised close to $15 million prior to this round. AliveCor develops EKG for mobile devices. The company’s products are both consumer and professional grade. The measurements are done by putting four fingers on electrodes which are wirelessly connected to a mobile device.  In 30 seconds a medical grade EKG is produced. The solution is sold for $99. The company was voted as one of the most innovative healthcare companies by the publication, Fast Company.

Dublin, OH-based Updox raises $13.7 million

Updox provides communication and document management solutions for medical practices. The company has a broad offering of services ranging from electronic fax to patient portal, email, appointment booking and surveys. For small physician offices, this approach is actually a sound one. There is a lot to be said about one stop shop to save time. We think Updox will continue its impressive growth.

Drchrono based in Mountain View, CA raises $12 million in Series A

We love this company. Drchrono is one of the most progressive enterprises in the EHR space. They have an agile architecture which can plug in the latest technologies and innovations. The company started eight years ago and generates $12 million in revenue largely catering to small practices. This funding will allow them to  aim higher and get into the larger markets competing with the big guys. Box was one of the early investors. This round was led by Runa Capital based in Palo Alto.

New York City-based Aetion receives $11.2 million from Flare Capital and others

Aetion provides solutions to assess real-world evidence (RWE) from a range of sources. The company’s clients are predominately life science firm’s and payers. The solution helps life science companies to better engage with payers and regulators. The RWE business is a big industry.

With drug prices on the rise, payers and government agencies are demanding more evidence for reimbursement. The industry spans from early stage R&D to clinical trials and the commercial phase for new drugs.

San Rafael, CA-based Conversa Health raises $11 million

Conversa is a patient engagement and patient relationship management company. The software not only keeps the patient and the care team connected, it also helps trigger alerts based on self-reported data from patients through a curated Q&A and/or results of biometric monitoring devices.

We like this industry a lot. These solutions allow case workers to cover more patients and bring the concept of patient engagement closer to reality. 

Retriever Medical based in Valhalla, NY receives minority investment from TA Associates

The company is one of the largest payment processors for the dental, physician, hospital and veterinary clinics. Retriever, founded in 1993, serves over 15,000 practices. Company claims that they are the only processor that can update the patient’s file on any practice management system; substantially cutting credit card processing fees.

Over the years Retriever has become more and more sophisticated. The company offers tools that accelerate cash flow and reduce uncollectible balances through the company’s credit, debit and ACH acceptance capabilities.

Afsaneh Naimollah

Xen Partners

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Palo Alto, CA 94301
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Afsaneh@XENPartners.com
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