May the luck of the Irish be with the health tech sector and may everybody’s valuation go back to where it was for the St. Patrick’s Day episode of Health Tech Deals! In today’s episode, Jess asks me about Doctolib’s €500 million raise with a massive €5.8 billion valuation – this is a doctor booking service and more in Europe. We also cover specialty pharma company House Rx’s $25 million raise, bringing their total up to $30 million, SmithRx’s $27 million raise for its flat-fee PBM, Synapse Medicine’s $28 million raise doing medication management, and Kintsugi’s $20 million raise for its voice biomarker mental health tech. —Matthew Holt

TRANSCRIPT

Jessica DaMassa:

What’s that over there? Is that a little leprechaun sitting next to a pot of gold at the end of a rainbow? No, it’s just Matthew Holt. May the luck of the Irish be with the health tech sector and everybody’s valuation goes back to where it was in the summer of 2021. It can only be the March 17th ,St. Patty’s day, episode of Health Tech Deals.

Matthew Holt:

So, Jessica you’re from Chicago, right?

Jessica DaMassa:

I am.

Matthew Holt:

And they have the big St. Patrick’s Day Parade there and they dye the river green?

Jessica DaMassa:

They dye the river green. Nobody believes it but it’s true.

Matthew Holt:

So why don’t they dye it blue the rest of the year?

Jessica DaMassa:

It fades gently into a blue color.

Matthew Holt:

I’ve been to Chicago. It’s like a gray river.

Jessica DaMassa:

It depends. It depends. No, that’s great. The south side Irish in Chicago, shout out to them from this west side Italian girl. They always say they have a saying in Chicago that if you’re not Irish… wait. No, what’s the saying? If you can’t marry Irish, you should marry Italian because at least you’ll have beautiful babies. That’s the line.

Matthew Holt:

Well, you’re beautiful and your parents were Italian. But they couldn’t find any Irish people to marry.

Jessica DaMassa:

No.

Matthew Holt:

You’d been much uglier in that case.

Jessica DaMassa:

Yeah. I guess that’s how it goes..

Matthew Holt:

English people shouldn’t be talking about the Irish, well not like that anyway. Hey by the way, talking about something completely different, your friends at Komodo.

Jessica DaMassa:

Oh my God. The rumor mill, I cannot keep up. It’s like they’re IPOing and they’re not IPOing. Arif (CEO) says something during ferce JPM and it gets published, but I asked Web Sun about it in an interview and he’s like. “eeerrr” And now all of a sudden, apparently it’s happening.

Matthew Holt:

Well, it did say a couple things, right? One is that their revenue is 150 million.

Jessica DaMassa:

Mm-hmm (affirmative).

Matthew Holt:

Not bad, right? And the valuation they claim is around five billion. So just for comparison sake, say Doximity is about 300 million in revenue at the moment. And their valuation is about 8 billion but Doximity is super profitable. It said Komodo had high margins was not yet profitable, but clearly business is heading in the right direction, not everyone says. As you mentioned earlier, the stocks may not all be reflecting of their online business.

Jessica DaMassa:

But what do you think of this valuation for Komodo? Do you think that’s more realistic than the valuations we were seeing for companies that were going to IPO and spac out last year, this time?

Matthew Holt:

Yeah, it seems to be growing fast, but there’s a bunch who are in that zone, right?

Jessica DaMassa:

Yeah.

Matthew Holt:

And the question faster growing and how much are they spending to get there? At some point, people are going to start looking at profit. Disgusting, dirty word in Silicon Valley.

Jessica DaMassa:

Why would you do that?

Matthew Holt:

You’re obviously going to look at speed of growth and profit, but they also are selling a lot to pharma, right?

Jessica DaMassa:

Yeah.

Matthew Holt:

So, they’re selling data to the Pharmacos. So they’re not really the same bind as some of the other digital health companies, trying to figure out how to sell to providers and directly to consumers. So if you look at Hims and Ro on the direct to consumer side rows in public, who don’t know the numbers, but clearly with Hims and in the health plan site, like Bright and Oscar people have been directly marketing, been losing a ton of money doing that. And well a lot of people have been growing their revenue, but growing their losses faster, it’s little bit tricky.

Jessica DaMassa:

Yeah. It’ll be interesting to see this next cohort of companies that goes public.

Matthew Holt:

It’ll be a different world than it was last year. For sure. As you mentioned in the very early break. Okay. Let’s go on ready?

Jessica DaMassa:

Let’s go. Doctolib 500 million euros, 5 billion plus valuation coming out of Europe. Matthew Holt, it’s huge, huge in Europe, huge.

Matthew Holt:

Nuts. Yes, it’s a doctor booking service and they do other stuff, including… And they’re claiming all the doctors in France on board and all the hospitals and they got somewhere in Germany, Italy elsewhere. But you could buy three Babylons for this by the valuation of the market.

Jessica DaMassa:

Would you want to?

Matthew Holt:

I don’t know how. The French healthcare system is just not that big and it’s like ZocDoc for it. So, it’s a great service. It’s got a lot of traction in France and elsewhere in Europe. They bought a German company as well, but…

Jessica DaMassa:

Okay.

Matthew Holt:

Valuation’s nuts.

Jessica DaMassa:

All right. What about House Rx? It’s a specialty pharma company, 25 million brings their total up to 30.

Matthew Holt:

Yeah. Bessemer is in this one, this is one of the specialty pharmacy plays. Can you get specialists to directly sell pharmacy? Probably you can like one stop medical care and dispensing, which is great. On the other hand, they’re going after the big specialty pharma companies, all of whom are owned by the big PBMs, hence on next one.

Jessica DaMassa:

Smith Rx, which got 20 million dollars that brings their total up to 37.5. This is a flat fee PBM, which seems like it’s a new thing to do.

Matthew Holt:

Yeah. VenRock, Brian Roberts and Bob Kocher in this one were Founders fund and others. Look PBMs, the two big ones left, right? Which are now CVS and Express Scripts which is part of Cigna, lots of bad press about them. The idea is can you do a PBM which only has one flat fee Withme Health doing that, Capital Rx is doing that, Right Way is doing that. Maybe.

Jessica DaMassa:

All right. What about Synapse Medical? They get 28 million in a B brings their total up to 40.

Matthew Holt:

Yeah. Another European company doing something on medication management stuff I don’t understand.

Jessica DaMassa:

Okay. Kintsugi they get 20 million, 28 million is their total. Vocal biomarkers for depression. I always thought this was so cool. Their tech is cool.

Matthew Holt:

Yeah. I met Grace Chan, I think who was one of their leaders along with who was the person I met… Oh, I’ll have to remember. Rema Seiilova-Olson , I met them both.

Jessica DaMassa:

I can’t believe you didn’t remember her name, it rolls right off the tongue.

Matthew Holt:

Don’t remember her name but now I can. Met them both at that party that we were at on Monday, Tuesday night. Vive

Jessica DaMassa:

Oh my god. Your memory is completely going.

Matthew Holt:

My memory. I can’t remember where I was when I was and what I did. What’s interesting, right? Is this is very similar to Ellipsis, which got, I think 25, 28 million. So the concept is, can you basically take the diagnosis, which is the PHQ and the GAD7 scales, which are paper forms, that people fill out and have to self assess how they’re doing, which a lot of people like our friend Monique Levy at Woebot says is pretty silly & doesn’t work very well. Can you replace that by looking at someone’s affectation or in this case, the sound of their voice and tell you what’s wrong with them. It sounds brilliant. I don’t know how much money there is in the diagnosis part, right?

Jessica DaMassa:

Really?

Matthew Holt:

Even if you roll it out in a bunch of stuff, if I can just diagnose you and I’m competing with a free paper form, how bad is the form has to be before you can change it to this? I’m a bit curious about that.

Jessica DaMassa:

What if it’s more accurate and you get people to the right place faster?

Matthew Holt:

That is a challenge. There are a whole bunch of other companies trying to figure out, can you figure out which drug works better on what type of patient and that kind of stuff. There’s a lot in mental health we don’t know, obviously.

Jessica DaMassa:

Yeah.

Matthew Holt:

We’re good at treating mental health. We’re getting slightly better, but we’re not very good. And yeah, the PHQ and the GAD7 have been around forever and they’re not particularly accurate.

Jessica DaMassa:

Useful.

Matthew Holt:

They’re not great. So maybe there’s something that can be done. Anyway…

Jessica DaMassa:

I don’t know. I like this whole like virtual care enablement stuff, category that’s happening.

Matthew Holt:

Yeah. If you can do diagnosis and eventually treatment, right? Which is the whole concept of…

Jessica DaMassa:

Yeah but there’s a lot of room, I think in diagnosis, I think we’ve been focusing on treatment, right? More or less.

Matthew Holt:

We haven’t figured how to get treatment paid for, whether the treatment works? I hope it does but interesting company, something to keep an eye on.

Jessica DaMassa:

Yeah, absolutely. What else you got to say?

Matthew Holt:

Am I saying too much? Yeah…

Jessica DaMassa:

Old man health tech.

Matthew Holt:

I was on a panel with Dominick, your friend Dominick from G4.

Jessica DaMassa:

Dominick Kennerson from Bayer. His name, you also don’t remember.

Matthew Holt:

When we get one of those brain implants?

Jessica DaMassa:

Three hours ago and you don’t remember?

Matthew Holt:

I had to get up very early before I had coffee through that session.

Jessica DaMassa:

I wish there was some sort of vocal biomarker thing that could screen you for some sort of…

Matthew Holt:

I need the treatment thing. I need the thing, which implants the name in my brain where I go, “you again were Jessica, Jessica somebody” .

Jessica DaMassa:

You always remember me. And then you think, I remember everything you remember, which is like, I don’t want to be in that head of yours.

Matthew Holt:

Anyway. But he was talking about the .com bust and how slow things have been and how tough it is for big strategics to move. And he was kind of almost depressed. I was saying, well, maybe the whole world can be changed with this new technology. And I don’t know, we’d have to take a poll of the Columbia Business School class to assess which one of us was more convincing.

Jessica DaMassa:

They picked him for sure, right? Oh, I mean like… Let redo that. Hold on a second. Who did they pick?

Matthew Holt:

You’re assuming that A, there was a poll and B, if there was a poll that I would lose.

Jessica DaMassa:

Always.

Matthew Holt:

Jessica. Jessica. Jessica. I am touched by the faith.

Jessica DaMassa:

You know who we haven’t talked about at all, Matthew Holt? HIMSS. We haven’t talk about HIMSS.

Matthew Holt:

It’s happening. the FOMO party. I missed out the Cerner party with… I know that Grace Cordavano was cutting a rug on the dance floor I hear. Yeah. Lost time.

Jessica DaMassa:

All right. Send us your guys up from HIMSS because we’re here. Not there. I’m @jessdamassa and he’s at @boltyboy and to never miss an episode of Health Tech Deals, even while you’re at HIMSS, you can catch up by subscribing to the email newsletter over there at thehealthcareblog.com. Nice emphatic hand gesture there. Mr. Holt. Good job. You can subscribe there and get these episodes of this show. My WTF health interviews, Matthew’s little quick bite interviews, which came out of Vive and all the other content from the blog delivered to your inbox every week.

Matthew Holt:

And there is a ton going up in the next week.

Jessica DaMassa:

So much video content.

Matthew Holt:

Yeah. There are five or six really great articles We’ve got a great one exposing the Joe Rogan show and lots of goodies. Lots of goodies to come.

Jessica DaMassa:

Can’t wait. Alright, guys. We’ll see you soon. Thanks for joining us. Bye.