Health tech funding snapshot—AppliedVR banks $29M; Khosla Ventures backs Rightway’s $100M round

Virtual reality (VR) technology is emerging as one of the more promising, and nonaddictive, pain management tools.

Los Angeles-based AppliedVR provides virtual reality-based treatments aimed at comprehensively treating chronic pain and the company now works with more than 200 of the top healthcare provider organizations. Geisinger and Cleveland Clinic are both working with the company on separate clinical trials to study VR as a replacement for prescription opioids.

And, the startup is engaged with multiple payers, testing VR as a cost-effective solution for treating chronic pain.

AppliedVR collected $29 million in series A funding backed by F-Prime Capital, JAZZ Venture Partners, Sway Ventures, GSR Ventures, Magnetic Ventures and Cedars-Sinai.

“Chronic pain is one of the most common medical conditions in the world, yet it still is incredibly debilitating to patients, costly to the system and complex to treat,” said Matthew Stoudt, co-founder and CEO of AppliedVR.

The COVID-19 pandemic has created a surge in demand for digital medicines like VR that can be delivered safely to patients in their own homes, he said.

“As a leading evidence-backed VR therapeutics provider in healthcare, we’re committed to meaningfully improving the lives of people suffering from chronic pain by making VR the standard of care for treating chronic pain in a provider-prescribed, payer-reimbursed model,” Stoudt said.

The company’s EaseVRx solution recently became the first virtual reality (VR) prescription therapeutic to receive breakthrough device designation from the FDA for treatment-resistant fibromyalgia and chronic intractable lower back pain.

The new financing will fuel the company’s growth as it pursues full FDA approval over the next year.

Here's a snapshot of other health IT funding deals of more than $25 million in March:

Vertically integrated digital health firm: Ro raised $500 million dollars to scale up its platform that includes online pharmacy services, telehealth and in-home care. The Series D round was led by existing investors General Catalyst, FirstMark Capital and TQ Ventures with significant participation from SignalFire, Torch and BoxGroup, and a number of new investors.

AI-driven drug discovery: Insitro collected a mammoth $400 million funding round from investors Canada Pension Plan Investment Board, Andreessen Horowitz, Casdin Capital, ARCH Venture Partners, Foresite Capital, GV, and other, FierceBiotech reported.

Tech-enabled primary care: Marc Benioff, founder, chairman and CEO of Salesforce, and musician The Weeknd are among investors to back Forward's $225 million series D funding round. Founders Fund, Khosla Ventures and Softbank, among others, also participated in the funding round, 

Healthcare "map maker": Komodo Health netted $220 million in new funding to build out its data analytics platform for healthcare and life sciences research. The Series E funding round was led by Tiger Global and joined by Casdin Capital. Existing investors Iconiq Growth, Andreessen Horowitz and Silicon Valley Bank also joined the round.

Drug discovery software: Valo Health nabbed a $300 million Series B round, including $110 million from Koch Disruptive Technologies. Other investors include The Public Sector Pension Investment Board (PSP Investments), Flagship Pioneering, Invus Public Equities, HBM Healthcare Investments, Atinum Investment and Mirae Asset Capital, according to FierceBiotech.

Modernizing medical billing: Cedar scored $200 million in Series D financing led by Tiger Global Management. Existing investors Andreessen Horowitz, Thrive Capital and Concord Health Partners also participated in the Series D round.

At-home health care: DispatchHealth has secured an additional $200 million in series D financing less than one year after closing a $135.8 million Series C round. The funding deal was led by Tiger Global with previous investors Humana, Alta Partners, Echo Health Ventures, Oak HC/FT and Questa Capital funding the remainder of the round. 

Primary health model: Crossover Health hauled in $168 million in new funding to expand its primary care platform to self-insured employers and payers across the U.S. The oversubscribed Series D financing round was led by Deerfield Management Company, and investors Perceptive Advisors, OrbiMed Advisors, Foresite Capital, Avidity Partners, SharesPost100 Fund, Irving Investors and PFM Health Sciences, also participated.

Virtual research: Evidation Health clinched another $153 million to further transform its virtual research programs into digital interventions, FierceBiotech reported. The company’s latest series E round was co-led by OMERS Growth Equity and Kaiser Permanente Group Trust with additional investments from previous backers McKesson Ventures and B Capital Group.

Social services platform: Unite Us launched in 2013 with a software platform to help connect people to social services. The company banked $150 million in series C financing led by Iconiq Growth. The round was backed by Optum, Emerson Collective, Transformation Capital, Define Ventures and several healthcare partners as well as existing investors Salesforce and Town Hall.

Kidney care startup: Alphabet’s independent growth fund CapitalG backed Strive Health’s $140 million Series B funding round. Redpoint also joined current investors NEA, Town Hall Ventures, Ascension Ventures and Echo Ventures to complete the round

Enterprise analytics: Venture capital and private equity firm Insight Partners led a $115 million Series C funding round for Clarify Health. The company will use the financing to scale its self-service healthcare analytics cloud and business software.

Digital health platform for biopharma: BrightInsight banked $101 million in Series C funding led by venture capital firm General Catalyst. Existing investors including Insight Partners, New Leaf Venture Partners and Eclipse Ventures also participated in the round.

Care navigation: Rightway, which developed a digital care navigation and pharmacy benefits platform, secured $100 million in Series C financing. The round was led by Khosla Ventures, with participation from Thrive Capital, Tiger Global Management, and other existing investors. 

New mental health unicorn: Ginger raised $100 million backed by investment firm Blackstone Growth, boosting its valuation to $1.1 billion. Blackstone joins existing investors from Kaiser Permanente Ventures, Cigna Ventures, Bessemer Venture Partners, Advance Venture Partners, Khosla Ventures, Health Velocity Capital, City Light Capital and WP Global Partners.

Virtual lab testing: Ixlayer, which provides technology-based solutions for diagnostic testing, scored $75 million in an oversubscribed Series A funding round. General Catalyst lead the round with participation from the lead seed investor PearVC and others including Signatures Capital’s Bobby Yazdani, Uber CEO Dara Khosrowshahi, 23andMe CEO Anne Wojcicki, MBX Capital’s Zeshan Muhammedi and Prologis CEO Hamid Moghadam.

Digital therapeutics: Happify Health blends gaming, science, people and technology into building its digital therapeutics for people with chronic diseases. The startup raised $73 million in new funding led by Deerfield Management Company. Omega Capital Partners, ION Crossover Partners and existing investors also participated.

AI-driven care coordination:  Stroke-spotting software developer hauled in $71 million to help expand its artificial intelligence programs into other acute care areas. The round was co-led by Scale Venture Partners and Insight Partners with additional backing from Greenoaks, Kleiner Perkins, Threshold Ventures, CRV, Innovation Endeavors and Susa Ventures, FierceBiotech reported.

Virtual monitoring: Health Recovery Solutions secured $70 million in Series C funding led by LLR Partners with participation from existing investor Edison Partners. The company's remote patient monitoring technology records patient vitals via Bluetooth and connects them with their clinicians through video or instant messaging, Forbes reported.

Cardiac diagnostic platform: Ambix Life Science Fund I, L.P. led a $65 million Series C funding round in CorVista Health. The round was joined by MedVenture Partners, Inc. as well as several new and previous investors. CorVista Health developed a non-invasive, point-of-care solution that allows physicians to rapidly test for heart disease.

AI-Based Automation:  Akasa (formerly known as Alpha Health) collected $60 million in a Series B round of funding to scale its solution that automates complex operational tasks such as those related to revenue cycle management. BOND led the series B round with existing investors Andreessen Horowitz (a16z) and Costanoa Ventures, among others, also participating.

At-home medical kits: Tyto Care snapped up an additional $50 million in series D funding led by Insight Partners. The company lined up new investors that include Tiger Global Management and Qumra Capital along with new funding from existing investors Qualcomm Ventures, Olive Tree Ventures and Shenzhen Capital Group Co.

Support for working parents: Transformation Capital led a $40 million Series C investment into Cleo, which offers a family benefits platform that brings holistic health, career and wellness support to working parents and families. Glynn Capital, Prudential Ventures and Gaingels and existing investors Greylock, NEA and Felicis also joined the funding round.

Data analytics: Clearsense raised $30 million in new financing led by Health Catalyst Capital. The company will use the new capital to build out its technology and advisory services.

Diabetes management: Glooko landed $30 million in a Series D round led by Health Catalyst Capital with participation from Canaan Partners, Georgian, Novo Nordisk, Insulet and the Mayo Clinic. The proceeds will be slated to help expand Glooko’s remote patient monitoring services spanning diabetes and obesity to other chronic conditions as well as to new offerings in clinical research.

Cancer digital therapeutics: Blue Note Therapeutics closed a Series A financing round of $26 million for its prescription digital therapeutic (PDT) to treat cancer. The financing was led by JAZZ Venture Partners and joined by Summer VC.

Remote patient monitoring: 100Plus landed $25 million in seed funding with angel investors Henry Kravis and George Roberts leading the round. The company has executed a distribution partnership with AdvancedMD, DrChrono and athenahealth, leading medical billing and electronic health record providers.

AI-enabled diagnostics: Paige, a provider of computational pathology for diagnosing and treating cancer, raised an additional $25 million in Series C financing, bringing the round to over $125 million. Casdin Capital and Johnson & Johnson Innovation – JJDC co-led the funding round and Catalio Capital Management participated.

Telehealth startup: Lux Capital led a $25 million Series B funding round for telehealth provider SteadyMD. Other investors in the round include Ashton Kutcher and Guy Oseary's Sound Ventures, Acrew Capital and additional healthcare investors