The global economy is currently at a turbulent intersection, one that even the most celebrated economic pundits and fiscal savants cannot seem to accurately navigate. While some say that the economy is headed for a “soft-landing,” others exclaim that a full-blown recession is inevitable.
The healthcare industry is by no means immune to these economic pressures, Forbes reports. In fact, healthcare has had many years of its own unique fiscal challenges— those that were uniquely exacerbated by the Covid-19 pandemic. Regardless, over the last decade, venture capital (VC) funding and investments in healthcare have actually been quite strong, as investors were eager to invest in cutting-edge technologies and the next generation of care delivery. Now, however, these same sources of funding are starting to slow down in fear of economic turmoil, indicating that rapid innovation in healthcare may indeed take a pause.
A recent report by Rock Health indicated that there has been a significant slowdown in healthcare funding, specifically in the areas of the digital health. The report authors explain: “For the digital health sector, 2022 was a downhill ride—one that we think signals the tail end of a macro funding cycle centered around the COVID-19-era investment boom […] 2022’s total funding among US-based digital health startups amounted to $15.3B across 572 deals, with an average deal size of $27M. Not only did 2022’s annual funding total come in at just over half of 2021’s $29.3B2, but it also just squeaked past 2020’s $14.7B sum. Notably, 2022’s year’s Q4 $2.7B total was less than half of last year’s Q4 raise ($7.4B).” Read more.
