AppliedVR nabs $36M to scale up virtual reality platform to support more health conditions

As it builds more evidence to support its virtual reality therapeutic for managing pain, startup AppliedVR picked up $36 million in fresh funding to fuel its growth.

The Los Angeles-based company also is awaiting a decision from the Food and Drug Administration (FDA) on its first de novo submission. The company is preparing for full market launch of its flagship product, EaseVRx, after FDA approval.

With this funding, AppliedVR also has its sights set on additional payer pilots, building out its product pipeline, conducting more clinical research and continuing to build its VR pharmacy platform, executives said.

The series B funding included investments from F-Prime Capital, JAZZ Venture Partners, Sway Ventures and SVB Ventures. The company has raised $71 million to date.

“For too long, we’ve relied on the notion that people need to take pills or rely on surgery to feel better and lead a better quality of life. At AppliedVR, we’re building an unparalleled body of evidence for providers and payers to demonstrate that immersive therapeutics can fill the massive unmet need for patients who are frustrated by current treatment paradigms. And, we are starting with chronic pain, one of the most complex, costly conditions,” said Matthew Stoudt, co-founder and CEO of AppliedVR, in a statement.

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AppliedVR's goal is to make immersive therapeutics accessible to everyone, he said, "and this funding will help further expand our body of evidence, infrastructure and distribution platform, enabling patients and providers to take advantage of this next-generation therapeutic—while also bringing down costs for payers.”

AppliedVR's platform has been used by more than 30,000 patients in more than 240 of the top health systems globally. Its flagship product for chronic pain, EaseVRx, recently became the first VR prescription therapeutic to receive FDA breakthrough-device designation for treatment-resistant fibromyalgia and chronic intractable lower back pain.

The company's VR platform—which uses goggles and headsets to create an immersive, 3D virtual world—has been aimed at alleviating everything from labor pains during childbirth to the pain from burns to discomfort experienced undergoing infusions for cancer treatment.

Company executives say AppliedVR's platform comprehensively addresses multiple pain indicators, leading to people reporting reductions in pain and associated interference of daily life both immediately and for several months after treatment is completed. People suffering from pain follow a science-backed, clinically validated curriculum of immersive VR programming to reduce their pain and help them learn skills for managing pain in the real world.

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“Virtual reality is now a smart, practical and effective therapy for healthcare because of innovations from companies like AppliedVR. As the pandemic demonstrated, the U.S. healthcare system desperately needs more care access through scalable solutions that are available in people’s homes, and potent therapeutics delivered with VR are a perfect solution,” said Zack Lynch, co-founder and managing director of JAZZ Venture Partners, in a statement. 

There's a growing number of healthcare companies trying to tackle chronic pain with digital solutions, and the use of VR, in particular, is gaining momentum.

AppliedVR is engaged in multiple studies with payers for determining reimbursement, Josh Sackman, AppliedVR co-founder and president, told Fierce Healthcare in October, and also is investing heavily in evidence development to continue demonstrating strong health outcomes and addressing the cost-effectiveness of its digital solution.

AppliedVR also just announced results from a peer-reviewed, collaborative research project with S.O.L.V.E. Health Tech, a health equity incubation partner embedded within the University of California, San Francisco. The research, published in the Journal for Medical of Internet Research, studied how VR could be used for pain management in safety net settings for vulnerable populations like Medicaid patients.

Pain, especially chronic pain, is one of the most complex and expensive health problems to address. Affecting approximately one-third of all Americans, chronic pain is estimated to cost as much as $635 billion each year, making it more expensive than cancer, heart disease and diabetes combined.

Exacerbated by the COVID-19 pandemic, the chronic pain epidemic continues to fuel America’s opioid crisis. AppliedVR is currently collaborating with Geisinger and Cleveland Clinic to advance separate NIDA-funding clinical trials that test VR as an opioid-sparing tool for acute and chronic pain.