- 2019 was a critical year for biotech and healthcare startups, with an unprecedented number making the leap from private to public, and more considering making the jump in 2020.
- There are 19 healthcare startups that have reached unicorn status, or the $1 billion and over valuation mark, according to PitchBook and Business Insider’s reporting.
- Some like Bright Health and Clover Health added hundreds of millions to their war chests in 2019, while others didn’t take on additional funding in the last year. Here’s what to know about the companies going into 2020.
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2020 is gearing up to be a pivotal year for healthcare and biotech startups.
In 2019, a handful of health startups went public with valuations above $1 billion, placing them in unicorn territory.
2020 is shaping up to be an even more prolific year, with reports that companies like One Medical could go public by the first quarter of 2020.
While companies like Tempus, Ginkgo Bioworks and health insurance startups Clover Health and Bright Health added to their war chests, others like 23andMe and Butterfly Network maintained their unicorn status without taking on additional funding, according to data provided by PitchBook.
Clarrie Feinstein contributed to a previous version of this post.
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.
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.
Clover lost $26.5 million in the first nine months of 2019, according to state insurance filings reviewed by Business Insider.
The 2019 loss was deeper than the company’s net loss of $18.7 million over the same period in 2018. Clover had 42,087 Medicare Advantage members at the end of the third quarter, up from 31,902 at the end of the third quarter in 2018.
It’s been a big year for Clover. In March, the company said it was laying off 25% of its workforce, or about 140 employees, as part of a restructuring. That came on the heels of Clover raising $500 million in January, bring the total funds the company has raised to $925 million.
Its most recent valuation was $1.2 billion, according to PitchBook data from prior to the $500 million round.
Rakuten Medical – $1.2 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 firm 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 – $1.2 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.
Butterfly Network – $1.3 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.
One Medical – $1.5 billion
Primary-care startup One Medical could be the first unicorn on the list to go public in 2020.
CNBC reported in October that One Medical has hired JPMorgan and Morgan Stanley ahead of an IPO filing expected by the first quarter 2020.
When the San Francisco-based primary-care startup One Medical opened for business in 2007, its goal was to upend the way people got medical care by making it easy and convenient to see a doctor. The company charges a $200 annual fee and bills your insurance.
After a big infusion of capital in 2018, it’s expecting to double the number of medical clinics it operates over the next two years.
The company raised $220 million in funding in a 2018 round led by The Carlyle Group. In total, the company’s raised $408 million and has a private valuation of $1.5 billion, according to PitchBook.
Heart Flow – $1.6 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. In total, the company has raised $532 million.
Zocdoc – $1.8 billion
Zocdoc helps patients book doctor’s appointments and check in for them — everything from primary care to dental, to optometry appointments.
Users can search based on procedures, conditions, or even a particular doctor they might want to book an appointment with.
New York-based Zocdoc most recently raised $130 million in a series D round in August 2015, bringing its total raised to $223 million. The company’s last reported valuation also dates from 2015, according to PitchBook.
Devoted Health – $1.8 billion
Devoted Health wants to reinvent how we care for aging Americans.
The company started selling Medicare Advantage plans in parts of Florida for 2019.
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.
Bright Health – $2.2 billion
Bright Health provides health plans for individuals under the Affordable Care Act and to seniors in Medicare Advantage.
It was founded in 2016 and has raised more than $1 billion, after closing a $635 million round in December. A representative for the company declined to provide its updated valuation, though according to Pitchbook, the valuation is $2.2 billion.
Minneapolis-based Bright Health posted a net loss of $9.3 million for the first three quarters of 2019, a deeper net loss than the $4.2 million loss the company had over the same period in 2018. The company made $164.3 million in revenue and recorded $127.9 million in medical claims.
The startup covered 60,434 members as of September 30, mostly in ACA health plans for individuals and families.
The company said in July that it would operate in parts of 12 states in 2020, roughly double its geographic footprint for 2019.
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.
Oscar Health – $3.2 billion
New York-based health insurance startup Oscar Health currently sells insurance on the individual exchanges set up by the Affordable Care Act and to small businesses. The company had 235,371 members as of September 30, slightly more than the company had in 2018.
It’s planning to enter a new market in 2020, offering private Medicare Advantage plans to seniors.
In August, the company announced plans to sell Obamacare plans in 12 new markets in 2020, including in four new states.
Oscar has raised more than $1 billion from investors enticed by its promise of a new tech-driven approach to health insurance. In August 2018 it raised $375 million from Google’s parent company, Alphabet, and said it would use the funds to bring its plans to more people, including in Medicare Advantage.
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 undisclosed 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. It was valued at $3.45 billion as of December 2018, according to PitchBook.
Grail – $3.875 billion
Since it got its start in 2016, Grail has raised more than $1.75 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 December 2019, the company raised an additional $125 million out of a $250 million offering, according to a filing with the SEC. The company has started presenting data, including some on early-stage lung cancer detection, and plans to return results from its early-stage cancer-detection test in 2020.
Ginkgo – $4 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 September 2019, Ginkgo raised an additional $290 million. In total, the company has raised $719 million, and has additionally raised a $350 million fund to invest in spinout companies that use its technology.
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. The company resubmitted the implant for approval in September 2019.
Roivant – $7 billion
Roivant Sciences is a company known for developing drugs that other pharmaceutical companies have abandoned.
The company was founded by CEO Vivek Ramaswamy, who’s now 34. Through its subsidiary companies, it identifies experimental drugs that other companies may have stopped developing for one reason or another that still have potential to get approved and go on the market.
So far, it’s launched 17 subsidiary “-vant” companies, including a number that have gone public. Those include neurodegenerative-disease-drug developer Axovant Sciences, women’s health company Myovant Sciences, and urology company Urovant Sciences.
In December, the company entered a deal with Sumitomo Dainippon Pharma. Prior to that, the company had raised $200 million from investors a little more than a year after raising $1.1 billion in a monster round led by SoftBank’s Vision Fund. The $200 million round valued the company at $7 billion.
Samumed – $12.4 billion
Samumed is the highest-valued startup on this list.
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.