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Los Angeles is seeing a renaissance in medical technology.
Earlier this month a venture capital firm headed by two former Amgen executives announced they raised $500 million to boost and incubate new life science and biotech companies across Los Angeles. And the firm, Westlake Village Biopartners, is working to develop a 30,000 square foot campus in Thousand Oaks.
Across town, the 20,000 square foot LABioSpace is set to open. Funded through the county, federal funds and private donations, the incubator will feature lab space dedicated to bioscience research and collaboration and is designed to house up to 25 companies.
And yet, another "innovation hub" backed by the county and private funds called BioScienceLA is expected to launch its own space in Culver City next year.
"For years, we have lost talented scientists and entrepreneurs to other regions, due to lack of investment capital and start-up and expansion space for growing companies," said David J. Whelan, the CEO of BioscienceLA. "We are finally at an inflection point, with funding, space, and talent supporting each other to grow the LA life sciences ecosystem."
Here are some trends to watch in healthtech.
Telemedicine Brings Health Access and Equity to Patients at Home
Doctors visits and at-home testing have been made easier during the pandemic as more companies launch platforms to deliver health information to patients from home.
COVID-19 has sparked new demand for telehealth services to test and treat consumers. And more clinics and hospitals are adopting the tech. According to a PitchBook report, companies in the virtual health segment raised about $534 million in venture funding in the second quarter of 2020.
L.A. startups like Healthvana and ConsejoSano, a platform for patients and providers that aims to make healthcare easier to access for multiple cultures and languages. Last week, the North Hollywood company raised $17 million to build out its services like scheduling appointments and coordinating transportation to a patient's provider.
Meanwhile, Los Angeles-based MotiSpark developed a digital tool to send personalized reminders to users. And in September, the Santa Monica-based prescription discount platform GoodRx, went public and became the most downloaded medical app, boasting five million active users and 70,000 pharmacies.
More Investment in Diagnostics
Diagnostic companies typically have a hard time securing capital, but this year changed that. Kevin Zhang, a partner at Upfront Ventures who leads health and biotech investments, said the life sciences industry has seen a spike in gene therapeutics companies over the last few years. And the wave of new drugs brings with it new demand for lab testing.
"Frankly, it was a bit of a dead zone for venture investment," he said. "It's one of the least sexy areas to put money into. Now that's grown tremendously"
The pandemic has only accelerated that need, Zhang said, and investors have shifted their attitude about biotech companies focused on diagnostics.
Since March, L.A. biotech companies and labs like Curative have pivoted to developing and administering COVID-19 tests. The team's testing technology is now being deployed across the nation. Meanwhile, several companies are now producing vaccines and COVID-19 therapeutics as the nation gears up for mass distribution.
Employers Using Mental Health and Wellness Tech
The anxiety and stress caused by the pandemic has stoked demand for mental and physical wellness apps, including several based in Southern California. Experts see interest continuing into the new year as these wellness companies tap corporate partners to drive growth.
Earlier this year, Headspace, the Santa Monica-based meditation app, began offering free subscriptions to healthcare providers and teachers.
"We've seen explosive growth," said Headspace co-founder and CEO Rich Pierson at dot.LA's Summit in October. "CEOs have realized now that mental health is being discussed in every boardroom. That was not the case pre-COVID."
Calm, Talkspace and BetterHelp are among the handful of tech startups selling meditation classes and more affordable therapy access. And both Calm and Headspace offer a corporate product as employers and insurance companies have worked to make mental health resources more accessible since the pandemic began.
Exercise subscription platforms are also seen a boom. Apple launched its Fitness+ app in December, whose classes are filmed at a Santa Monica studio. As gyms remain closed in many parts of the country, consumers are buying up Pelotons and Mirrors. The craze is expected to continue to grow into the next year with several Southern California companies poised to benefit.
Indoor cycling app Zwift scored a $450 million investment in September. The Long Beach-based company is taking on Peloton building "hardware," presumably stationary bicycles, to go along with its 3-D generated worlds where users can compete from their living room. Another L.A.-based company Presence Fit raised $1 million in October for its two-way live interval training classes. And then there's FightCamp, which promises to capture the feeling of a boxing gym in your home.
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Born in Los Angeles County, where census data shows over half a million residents "speak English less than 'very well'," ConsejoSano wants to make access to life-saving health care bilingual.
The North Hollywood-based health care technology company provides outreach and appointment coordination for medical providers, facilities and patients in their language. It announced a $17 million Series B raise on Tuesday, led by San Francisco-based Magnetic Ventures.
"Today, a message is written in English, usually by an English speaker, and it's translated." said Abner Mason, chief executive and founder of ConsejoSano. "That approach doesn't work very well, because it doesn't build trust. Because what it says to the patient or to the plan member is 'Who you are doesn't matter.' If it's the same message …[it] overlooks everything about them that makes them unique."
ConsejoSano develops patient profiles from data gathered from public health and claims data as well as private data to determine the best ways to contact and converse with them. The ConsejoSano team then reaches out to patients to schedule appointments, review records and even coordinate transportation to their providers.
Mason has a long history in health care advocacy and policy. He previously founded Corporate Responsibility Partners, a company that helps companies to design, implement and evaluate workplace wellness programs, while serving as the chief executive of the Workplace Wellness and Prevention Council of Mexico.
Abner Mason is chief executive and founder of ConsejoSano.
Mason said the current system can overlook new Medi-Cal patients who don't speak English and often fails to set them up with basic health services such as immunization. His company can reach out to these new patients in 25 different languages and guide them through what is often a byzantine health system unequipped to deal with patients who don't know English.
One of the factors that drew him to Magnetic Ventures was that its founder, Christine Aylward, is a woman. Mason said he felt an underrepresented VC would better understand his vision.
"I'm Black, and let me tell you, it is very hard to raise capital. Most venture capitals are run by white men, which means that there's limited perspective from their experience and network. It's resulted in very few founders that are women and people of color," said Mason. "[Aylward] understands our mission in making health care accessible to everyone."
Other new investors in this round include the American Heart Association/Bernard J. Tyson Impact Fund, DaVita Venture Group, Salesforce Ventures and NBA All-Star Victor Oladipo. In total, ConsejoSano has raised $24 million.
ConsejoSano's technology platform aims to improve outcomes for minority patients
"ConsejoSano's unique technology platform, which is powered by a deep understanding of cultural nuances, is the best offering available to build trust, close gaps in care, and improve outcomes for minority patients," said Aylward, founder and managing partner of Magnetic Ventures in a statement. "There has never been a more critical time to fix this and to provide more equitable health care – we are long overdue."
In the coming year, Mason hopes ConsejoSano will expand beyond the 15 states it currently serves. However, he believes Los Angeles was the perfect location for the company's headquarters and to grow his team.
"It's really exciting to be in L.A., building a tech company in L.A., especially a company that can reduce health care disparities for everyone. This is because to do so, you need to have a team that's diverse. What's amazing about L.A. is it is one of the most diverse cities in the country. You can get incredible talent here to join a team, and you don't have to worry about not being able to find people with different backgrounds and cultures."
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