Health startups that focus on virtual care are getting an injection of cash from investors amid the COVID-19 pandemic.
Case in point: San Francisco-based Carbon Health scored a $28 million funding round from existing investor Data Collective in an extended series B.
Founded in 2015, Carbon Health is a technology-enabled primary care provider that blends in-person and virtual care services. The company has raised $75 million to date.
The funding has helped catapult Carbon Health through the COVID-19 outbreak, growing its workforce from 100 to 300 and focusing its efforts on testing and virtual care.
Carbon Health has expanded its virtual care to more states and now offers telehealth services in the 10 largest states, including hard-hit New York, New Jersey and Florida. The company is now serving nearly two-thirds of the U.S. population with virtual care and plans to be in all 50 states by this summer, according to the company.
These virtual visits, through the Carbon Health mobile app, cost $49.
The company's headcount has grown as it has hired pediatric and mental health providers to extend its virtual care services to include urgent care, primary care, pediatrics and mental health.
Carbon Health decided to go ahead with a series B extension in early March, around the time it decided it needed to ramp up healthcare services to address the COVID-19 pandemic, Eren Bali, co-founder and CEO of Carbon Health, told FierceHealthcare.
"We decided we wanted to aggressively address this problem, and we also understood that there were going to be reimbursement challenges and our costs were certainly going to go up," Bali said, noting that raising additional capital would help offset the financial uncertainty.
The company runs a network of brick-and-mortar locations that are supported by its mobile app, through which patients can schedule appointments, view their health records, pay for healthcare services or receive care through a telehealth visit.
Carbon Health quickly pivoted to address the COVID-19 pandemic by rolling out a digital Coronavirus Assessment Tool and providing in-person testing services at its clinics.
In just the past two months, Carbon Health has assessed over 14,000 coronavirus concerns through its assessment tool and completed more than 12,000 COVID-19 tests across its clinics and its partnerships with San Francisco and Los Angeles County.
The company also set up a mobile testing clinic to serve the Bay Area with a rapid COVID-19 test and has launched pop-up and walk-up clinics in San Francisco and Los Angeles.
"Expanding our testing efforts and virtual care footprint will help to reduce the pressure on local hospitals and clinics focused on COVID care, provide non-COVID patients the care they need without putting themselves at risk of exposure, and ensure communities across the country are healthy and well as we look towards reopening our economies," Bali said.
Carbon Health is one of a handful of healthcare companies pushing toward a tech-enabled care model. Other companies in this space include San Francisco-based startup Forward and One Medical, which provides a membership-based, tech-integrated primary care platform. Startup Heal's approach is to bring primary care back into the home with doctor house calls.
Diagnostic and remote care startups attract investors
Another health startup, LetsGetChecked, recently raised $71 million in a series C round led by Illumina Ventures and HLM Venture Partners.
New investors participating in the round included Deerfield, CommonFund Capital and Angeles Investment Advisors. Existing investors Transformation Capital, Optum Ventures and Qiming Venture Partners USA also participated in the round.
Venture capitalists are showing an increased interest in startups that offer direct-to-consumer healthcare services as a lower-cost alternative to more traditional services, and that will likely accelerate in a post-COVID-19 world.
Tyto Care, which provides an at-home medical exam and telehealth device kit, raised $50 million in its latest funding round in April. Medici, a healthcare messaging app, landed $24 million in a series B round of funding in late April, and Vida Health, which provides health coaching for patients with chronic conditions, closed a $25 million funding round.
New York-based LetsGetChecked, founded in 2014, provides direct-to-consumer at-home health testing, including for diabetes, fertility, cholesterol and cancer screening. LetsGetChecked has raised $113 million to date, according to Crunchbase.
The startup plans to use much of the funding to accelerate the production and supply capacity for a new COVID-19 testing kit.
In March, the company rolled out a two-part COVID-19 test that is administered by healthcare professionals, who can conduct the tests in patients’ homes and other locations. The COVID-19 tests include an antibody serology test, which produces results within 15 minutes, and a PCR-based test, which requires a swab from the patient that is sent to a lab.
The company is working with the FDA to have an emergency use authorization approved for use by customers to test in the home.
“We are working hard to deliver COVID-19 testing into the home and hope to have an answer soon. At-home testing has never been more important as consumers around the world look for new and trusted methods for managing their health," said LetsGetChecked founder and CEO Peter Foley.