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The 19 billion-dollar startups to watch that are revolutionizing healthcare in 2019

One Medical doctors

  • Healthcare startups saw some big changes in 2019. The robotics surgical company, Auris Health was bought by Johnson & Johnson and health insurance startup Oscar Health announced expansion in 12 new markets for next year.  
  • There are 19 healthcare startups that have reached unicorn status - or the $1 billion and over valuation mark, according to PitchBook.   
  • Some of the billion-dollar healthcare companies like 23andMe, Tempus, and One Medical on the list are worth watching as they revolutionize healthcare.  
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For private (and now public) healthcare and biotech companies, 2018 was a great year to raise capital with 16 companies reaching unicorn status. So far, in 2019, three more companies have been added to the list. 

Health Catalyst, which went public in July, Lyell Therapeutics and Rakuten Medical all reached the $1 billion valuation mark. 

Some significant changes happened in 2019, with Auris Health getting bought by Johnson & Johnson for $3.4 billion in February 2019, marking the company's valuation at over $5 billion. Tempus, the healthcare analytics platform, increased its valuation to $3 billion after less than four years. The health-insurance startup, Oscar Health, also announced plans to expand the company in 12 new markets next year.  

According to data from PitchBook, here are the top-valued healthcare companies of 2019.

This list was initially published in December 2018 and has been updated.

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Rani Therapeutics — $1 billion

Biotech startup Rani Therapeutics is taking on a problem that has eluded companies for decades — finding a way to turn injectable drugs into pills for people living with chronic conditions. The approach has the potential to upend billion-dollar markets for drugs such as insulin, and current treatments for autoimmune conditions like Humira.  

The San Jose-based company raised $53 million in February from Alphabet's venture investment arm GV. To date, Rani has raised $142 million. 



Rakuten Medical - $1.15 billion

Headquartered in San Diego, California, the company develops precision-targeted cancer therapies designed to treat solid tumors. 

The biotech is led by the Japanese billionaire Hiroshi Mikitani, who is also founder and CEO of the large Japanese e-commerce retailer Rakuten. Mikitani says he was inspired to fund the cancer research after his father was diagnosed with pancreatic cancer in 2012.

Rakuten Medical has raised about $471 million, according to PitchBook. Both Mikitani and Rakuten have invested in Rakuten Medical.



Lyell - $1.16 billion

Headquartered in San Fransisco, California, the biotech company is focused on treating cancer with cell therapies. Lyell's goal is to develop cell-based immunotherapies for cancer, with a focus on CAR-Ts and solid tumors.

Earlier this year, the company raised $179 million of Series B venture funding from Foresite Capital Management, ARCH Venture Partners and Altitude Life Science Ventures. The company has raised a total of $358 million, according to PitchBook. 

 



Clover Health — $1.2 billion

Clover Health sells Medicare Advantage health insurance plans. When seniors in the US turn 65, they can choose to be part of either traditional Medicare or Medicare Advantage, which is operated through private insurers like Clover and often provides additional healthcare benefits. The hope for San Francisco-based Clover and other technology-based health insurers is to use data to improve patients' health.

For the first half of 2019, the company said it took in $678 million in gross premium revenue, and that it generated a gross underwriting profit of $128 million.

In March, the company said it was laying off 25% of its workforce, or about 140 employees, as part of a restructuring. That came shortly after Clover raised $500 million in January, bringing the total funds the company has raised to $925 million.



Butterfly Network — $1.25 billion

Butterfly Network, a company that developed an iPhone-based ultrasound device, wants to make the technology more accessible to doctors and healthcare workers so they can make more precise diagnoses on the move. 

The device, called Butterfly iQ, plugs into the iPhone and isn't much bigger than the phone itself. It's been approved by the FDA for use in imaging things like the abdomen, bladder, and heart. 

In September 2018, Butterfly raised $250 million from investors including Fidelity, Fosun Pharma, and the Bill and Melinda Gates Foundation. In total, the company's raised $370 million. 



Ginkgo Bioworks — $1.38 billion

Ginkgo Bioworks is a startup that designs microbes to produce substances like fragrances or medications. The Boston-based company sends the programmed bugs to partner companies that put them to use.

In December 2017, the company raised $275 million at a $1.38 billion valuation. In total, Ginkgo's raised $437 million.



Health Catalyst - $1.5 billion

Headquartered in Salt Lake City, Utah, the healthtech company offers data and analytics technology and services to healthcare organizations. The company's customers, which are primarily healthcare providers, use the company's cloud-based data platform to manage their data and evaluate information to inform the operation of their organizations. 

The company currently works with over 50 healthcare organizations and has data from more than 100 million patients. 

The company went public in July 2019 and now has a market value of $1.5 billion. 



One Medical — $1.5 billion

One Medical was founded in 2007, and runs health clinics where it offers convenient appointments with doctors and other health-care providers. The service costs individuals $199 a year. Members still use their insurance during their visits to One Medical-run clinics, but the fee covers additional services such as mobile communication with One Medical staff members and mobile prescription renewals. 

In August 2018, the company said it had raised up to $350 million from private equity firm Carlyle Group, launching it into unicorn territory. In total, the company's raised $532 million.

The company has 72 locations in nine cities



Proteus Digital Health — $1.53 billion

Proteus Digital Health is developing what is known as digital therapeutics: pills with built-in chips designed to communicate that a patient has taken his or her dose. When ingested, the pill communicates with a patch worn on the patient's body, which in turn sends signals to an app that collects the information.

In November 2017, the Redwood City, California-based company's first drug — a version of Otsuka's schizophrenia drug Abilify — was approved.

Founded in 2001, the company most recently raised $50 million in a private equity round in 2016. In total, it's raised $420 million. 



HeartFlow — $1.56 billion

HeartFlow is trying to make the process of finding blockages in the heart a lot less invasive. Using imaging from a CT scan, Heartflow builds a 3D model that pinpoints the blockages associated with coronary artery disease, a heart condition that affects millions of Americans and is the leading cause of death in the US

HeartFlow is based in Redwood City, California, and reached unicorn status in 2018 after raising $240 million, bringing its total funding to $532 million



Devoted Health — $1.8 billion

Devoted Health wants to reinvent how we care for aging Americans, starting in 2019 with Medicare Advantage plans in parts of Florida.

The company's plans might look a bit different from traditional insurance in that Devoted plans to do more than pay for visits to doctors and hospitals. It's also hiring nurses and other employees aimed at keeping seniors healthier and out of the hospital.

Devoted was founded in 2017 by brothers Ed and Todd Park. Prior to Devoted, Todd co-founded health IT company Athenahealth and served as chief technology officer of the US during the Obama administration. Ed, who serves as Devoted's CEO, was formerly chief technology officer and later chief operating officer at Athenahealth.

In October 2018, the Waltham, Massachusetts-based company, raised $300 million in a series B round led by Andreessen Horowitz, bringing its total funding to $369 million.



23andMe — $2.5 billion

23andMe, a company best known for its genetics tests designed to tell you information as varied as the amount of Neanderthal DNA you have and potential health risks, gained a higher valuation in 2018 after striking a $300 million deal with drugmaker GlaxoSmithKline.

The company, founded in 2006, has millions of customers, and has a number of partnerships with major pharmaceutical companies. With GSK, 23andMe has a four-year-long development deal to use the data 23andMe's collected to discover and develop new medications. Using 23andMe's data, GSK is also working on an experimental drug to treat Parkinson's disease in patients with a particular mutation. 

To date, 23andMe has raised $792 million. 



Tempus — $3.1 billion

Chicago-based Tempus got its start in 2015, and in the last four years has rocketed into unicorn territory. The startup, founded by Groupon founder Eric Lefkofsky, aims to help doctors use data to find better cancer treatments for patients, using both clinical data — information about which medications patients have taken and how they responded to them — and data it sequences in its lab based on the tumors and hereditary genetics of cancer patients.

Tempus raised $200 million in series F venture funding from Novo Holdings, Revolution Group and New Enterprise Associates in May 2019. So far, the company has raised a total of $520 million. 



Grail — $3.2 billion

Since it got its start in 2016, Grail has raised more than $1.5 billion from the likes of Jeff Bezos and Bill Gates along with big names from the pharmaceutical, tech, and healthcare industries, including Johnson & Johnson Innovation, Arch Venture Partners, Amazon, Bristol-Myers Squibb, Celgene, and Merck.

The idea behind its cancer-screening test is to identify the tiny bits of cancer DNA that are hanging out in our blood but are now undetectable. If companies like Grail are successful, they would be the first to pull off a cancer-detecting blood test that works proactively.

The concept is similar to liquid biopsy tests, which use blood samples to sequence genetic information in that blood to figure out how tumors are responding to a certain cancer therapy. In 2017, Grail acquired Cirina, a Hong Kong-based company that is also looking at early cancer detection.

In May 2018, the company raised $300 million in a series C round and has started presenting data, including some on early-stage lung cancer detection



Oscar Health — $3.2 billion

Oscar Health offers health-insurance plans on the so-called Obamacare marketplaces in states including New York, New Jersey, California, and Texas. It also sells plans for small employers.

For the first nine months of 2018, according to state insurance filings reviewed by Business Insider, Oscar lost $12 million. That's significantly less of a loss than 2017, when it reported a $96 million loss in the third quarter alone.

In August 2018, Oscar raised $375 million from Google's parent company Alphabet to bring its tech-backed health insurance plans to more people.

For the first half of 2019, the company said it took in $678 million in gross premium revenue, and that it generated a gross underwriting profit of $128 million. 

In August 2019, Oscar announced plans to sell Obamacare plans in 12 new markets next year.

In total, the company has now raised more than $1 billion. 



Indigo Agriculture — $3.45 billion

Indigo Agriculture is harnessing plant microbiomes to try to make plants more likely to survive. Indigo does this by coating seeds with certain microbes, with the hopes that the plants will better withstand poor soil conditions, drought, and insects.

The Boston-based company raised an unsiclosed amount of venture funding from G Squared in March 2019. Previously, in September 2018 the company raised $250 million from investors including Baillie Gifford, Investment Corporation of Dubai and the Alaska Permanent Fund.

In total, the company's raised $620 million. 

 



Intarcia Therapeutics — $4.1 billion

Intarcia Therapeutics, a Gates Foundation-backed biotech, is developing implantable devices intended to treat conditions like Type 2 diabetes and to prevent HIV.

In September 2018, the Food and Drug Administration put the Boston-based company's plans for its diabetes implant on hold, citing manufacturing concerns. 

Intarcia has the chance to file for approval again after changes are made. "We remain confident in the approvability of ITCA 650 and we look forward to working very closely with the FDA on next steps," CEO Kurt Graves said in a letter on the company's website.

In March 2019, the company raised $73 million of convertible debt funding from undisclosed investors. To date, the company's raised $2 billion. 



Auris Health — $5.75 billion

In March 2018, the surgical-robotics company got FDA approval for its product called Monarch, which is a controller-operated robotic camera that helps doctors get visuals from within the body, including the lungs. 

"We believe that Monarch will become the go-to approach for diagnosing lung cancer in the future," Josh DeFonzo, who was then Auris's chief scientific officer, told Business Insider at the time.

In February 2019, the company was bought by Johnson & Johnson for at least $3.4 billion. 

 



Samumed — $12.4 billion

Samumed, the highest-valued startup on this list, is a company you've most likely never heard of.

The San Diego-based company has attracted a total of $764 million and a heady valuation thanks to a pipeline of what could be revolutionary treatments to regenerate hair, skin, bones, and joints.

The company's science hinges on something called progenitor stem cells. Samumed hopes to manipulate the pathway that makes these progenitor stem cells spring into action, so that they don't cause conditions like hair loss or osteoarthritis. 

The company had previously raised funding from backers including high-net worth individuals and sovereign funds rather than venture capital. Samumed's chief business officer Erich Horsley said in May 2018 that the company could go public in the next three to four years.

Read more about Samumed's progress with these treatments.





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