Digital health just had a record year. But is a day of reckoning ahead?
On paper, they are health care’s most promising upstarts — companies using data and software to detect the onset of debilitating diseases, deliver medical advice and treatments online, and monitor patients’ steps, sleep, weight, blood sugar, and heart function.
In 2018, digital health firms had a record year, raking in $8.1 billion from investors buying into the industry’s efforts to re-engineer the delivery of medical services, according to the venture capital firm Rock Health. That’s a 42 percent increase over the prior year.
But mixed into the enthusiasm for this blossoming industry are signs of stress. Valuations are skyrocketing before companies can establish clinical value and reliable revenue; many young firms are quickly burning through cash and asking for more. And even as pressure and expectations soar, the financial relief valves are clogged — U.S. digital health firms have not seen
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