By Even Sweeney | April 4, 2018
After a historic year of digital health funding, investment dollars continued to pour in during the first quarter of the new year.
Across the U.S. digital health funding reached $1.62 billion in Q1, according to data compiled by Rock Health. It was the largest first quarter on record, surpassing the $1.41 billion in venture funding in the first three months of 2016. Digital health investments reached $5.8 billion for all of 2017.
StartUp Health, which analyzes digital health deals across the globe, reporteda record 191 deals during Q1 totaling $2.8 billion, identical to Q1 funding totals the previous year.
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Rock Health analysts noted that investors “have become more confident investing in large, late-stage rounds.” Following eight deals totaling more than $100 million in 2017, three mega-deals closed in the beginning of 2018. And, for the first time, disease diagnosis tools led the way with $279 million in funding.
Some of the largest deals included Roche’s acquisition of Flatiron Health for $1.9 billion and Allscripts finalizing its deal Practice Fusion for $100 million. As FierceHealthcare previously reported, Allscripts initially offered $250 million for the EHR vendor, but pulled its offer following Department of Justice inquiry coupled with eClinicalWorks’ $155 million settlement last year.
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Healthcare providers continue to be one of the most prominent strategic investors in digital health, accounting for 24% of corporate investor transactions so far in 2018, according to Rock Health. Much of that is driven by the fact that the majority of digital health startups are selling to providers.