June 25, 2020
COVID-19 TO FUEL THE SHIFT FROM TRADITIONAL TO NEW-AGE DIGITAL HEALTH SOLUTIONS – ANGEL INVESTMENTS UP 3X IN Q2 2020 IN HEALTHCARE STARTUPS - VCCEDGE
New Delhi, June 25, 2020: COVID-19 has thrown the spotlight on the shortcomings of the healthcare sector and amplified the need for new-age digital health solutions and innovations as well as increased healthcare capacity and infrastructure.
India ranks 184th out of 191 countries in terms of percentage of GDP expenditure on healthcare. With 1.3 hospital beds, 0.65 doctors, and 1.3 nurses per 1,000 citizens, the country\'s healthcare sector was never ready to handle such a crisis.
"Covid-19 has highlighted the need for new-age digital health solutions. Going forward, the digital health market across the world would see a massive spike both from the demand and supply side of the ecosystem" - Sahaj R Kumar, Head- Research, VCCEdge.
The Indian healthcare industry has been backing digital technologies to foster an ecosystem for affordable, preventive healthcare for the first line of defence, and this has manifested in remote tele-medicine taking off, contactless COVID testing, remote monitoring and tracking of quarantined patients and so on. It is now clear that new-age digital health solutions will define the post COVID world.
Kumar added, "The focus to make a technology-enabled healthcare ecosystem as the backbone shall benefit India in solving many challenges present today. An ecosystem of Health IoT, AI, 3D Printing, Robotics coming together shall help in solving supply chain challenges, claims settlement, intelligent patient monitoring, clinical efficiency, and patient safety, among others. Digital interventions in healthcare ecosystems and corresponding investment surge in Health-tech players are the need of the hour".
According to VCCEdge, healthcare was already the hotbed for investments in India. 53% of the angel investments in 2019 were towards healthcare. In Q1 2020, the healthcare sector witnessed an increase of 50% in terms of volume YoY (21 deals vs. 14 deals of 2019) and 14% in terms of value ($452 Mn v $398 Mn in Q1 2019). Some of the notable deals were Curefit, raising $111.5 Mn, Iora Health Inc. raising $126 Mn, and HealthCare Global Enterprise Ltd. raising $119.7 Mn.
In 2020, the number of angel/seed investments were at their highest as compared to venture capital, private equity and public equity with 57% of the total angel investments going towards healthcare technology sector till date. Q2 2020 saw 9 angel/seed deals in health-tech as compared to 3 deals being carried out in Q1 (2020), an increase of 3X.
For the pharmaceutical sector, the average deal value increased to $50.65m in 2020 from $39.54m in 2019 as well as the percentage of deals valuing above $100 Mn also saw an increase of almost 10%. Unlike many other sectors, COVID-19 has been beneficial for the pharmaceutical industry due to increased demand. The biotechnology sector also saw renewed focus from investors with an investment in Biocon Biologics India Ltd., amounting to $74.6 Mn from Activ Pine LLP.
"As citizens, we owe a lot to our first responders, the doctors, and nurses who have been putting their own lives at risk while providing care services to battle this crisis. We need a ground-up approach to reimagine innovations in the field of care and how it is delivered to generate traction both in terms of startups and investments. For example, remote equipment management and control; tele-doc and medical access; drug trial and monitoring, patient and disease management. The development of health-tech is the only way to solve the industry’s pressing and complex challenges" - Shalil Gupta, Chief Business Officer - Mosaic Digital.
Post COVID-19, there would be a recalibration of healthcare towards new-age digital health solutions, especially in preventive healthcare. We would see a growing number of technology-centric firms due to growing consumer appetite for innovations such as easy and affordable doc-patient consultations, connecting health providers with pharma and diagnostic clinics in a holistic manner. These would particularly revolutionize healthcare delivery in Tier-2 & 3 cities as well as rural India. There would also be a massive social impact as a lot of these solutions would solve the needs of underserved women, vulnerable, marginalized, and economically disadvantaged sections of society.
VCCEdge is India’s most comprehensive research platform for private markets. It offers most updated information on deals, directories and financials data that adds up to a holistic financial research platform which is leveraged by investors, fund managers, PE's & VC's for deal origination, deal structuring, and valuations empowering them to make well-informed decisions, manage risk and achieve market-beating returns. It has a wide coverage of over 120K private companies and startups. For more details, visit www.vccedge.com.
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