Health
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Health
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For digital health, medical technology, diagnostics, and clinical innovation companies. Cleared products and good pilots no longer guarantee a market, and the gap between what the technology can do and what a buyer is willing to pay for has widened.

We work with leadership teams at the point where that gap starts to decide the company's future, helping them turn validated technology into a defensible commercial business.
Three key challenges shaping the coming years
The conditions every Health scale-up is now operating inside. Visible in 2025 employer benefit reviews, hospital procurement decisions, payer coverage rulings, and the reception that digital health and medtech earnings are now getting from the public market.

The sector has bifurcated: a small group of commercial leaders pulling away on revenue, valuation and capital, and a much larger middle losing oxygen. Three challenges sit underneath that split: the bar for proof has moved from engagement to outcomes, the AI boom is rewriting which moats are defensible, and the buy-side has consolidated faster than the supply-side.

They compound. A company strong on one and weak on another is the most common shape we see, and the most common reason commercial maturity stalls.
01. Engagement is no longer the proof
Roughly 80% of digital health products have little or no published clinical evidence (PHTI/ICER), and the buy-side has stopped being polite about it. Germany's BfArM has delisted multiple digital therapeutics from the DiGA Fast-Track after evidence reviews; the UK NHS anchors digital health procurement on NICE's Evidence Standards Framework; nearly half of digital health purchasers in PHTI's 2025 survey already use performance-based contracts tying payment to clinical and economic outcomes.

The market rewarded the shift in the same year. Hinge Health and Omada Health priced their 2025 IPOs because they came with positive free cash flow, eighty percent gross margins, and a decade of clinical evidence. 23andMe filed for Chapter 11 with a market cap that had fallen from $6B to near zero. Babylon's 2023 collapse remains the cautionary tale invoked at every European HealthTech board meeting.

Engagement metrics, pilot wins and a clinically credible story used to be enough to set a company on its way. They are now, at best, a starting position.
02. From AI feature to AI product
AI-enabled companies captured 54% of US digital health funding in 2025 and raised on average 83% more per round than non-AI peers (Rock Health). The same data shows the trap. The ambient scribe market grew from $87M in 2023 to over $975M in 2025, and inside two years 67% of outpatient providers say they are as likely to switch vendors as to stay (Menlo Ventures, 2025 State of AI in Healthcare).

Doximity launched a free AI scribe; Epic and Microsoft announced a native one at UGM 2025; the EU AI Act, in force since August 2024, treats most clinical AI as high-risk by default and stacks new obligations on top of MDR.

European challengers like Nabla and Corti are racing the same clock, against the foundation-model release cycle and against EHR incumbents already inside the workflow.

Companies that built a wedge on top of a general AI capability are now in a short race to turn it into a defensible product. With proprietary data, deep workflow integration, and outcomes evidence the next model release cannot replicate.
03. The buy-side has consolidated
The demand side of healthcare has consolidated faster than the supply side built to serve it. In Europe, Doctolib's £100M UK push and Medicus acquisition pulled French, German and UK primary care onto a single platform; the European Commission's December 2025 MDR/IVDR revision proposal explicitly acknowledges "structural deficiencies" in the notified body pipeline causing "certification bottlenecks, reduced availability of products, and unsustainable pressure on SMEs."

In the US, the top three GPOs (Vizient, Premier, HealthTrust) cover roughly 80% of hospital staffed beds, and the Transcarent and Accolade merger closed in April 2025 at $621M, creating a 20-million-member, 1,700-employer platform with a built-in marketplace for point solutions. EY's 2025 Pulse of MedTech reports the same shape globally: the number of medtech companies has fallen 11% since the start of the decade while the commercial-leaders cohort has grown 20%.

Across digital health, medtech and diagnostics, the addressable customer count is smaller than the patient market suggests, sales cycles run twelve months and longer, and pricing is set by counterparties whose explicit job is to extract concessions. The realistic options now are platform, partner, or be acquired.
A clearance, a strong pilot and a roomful of clinical advocates used to be enough to set a Health company on its way. They no longer are. Across digital health, medtech and diagnostics, the same thing keeps happening: the early customers love the product, the published evidence holds up, the next sales cycle stalls anyway.

Buyers have changed. A self-insured employer cutting its vendor list from twenty to eight wants outcomes data its CFO can underwrite. A hospital value-analysis committee inside a Vizient or Premier contract weighs your device against three others and asks for a health-economic case it can defend in front of its own board. A Medicare administrative contractor decides whether the diagnostic gets a coverage code, and the company's revenue model with it.

None of these conversations is the conversation the company was built to have.

The work that closes the gap is the part most companies treat as four separate workstreams. Clinical builds the evidence. Commercial chases the next contract. Product ships features and races whichever foundation model is closest to the category. Marketing reworks the website. The board reads four reports. The buyer reads one company, and the renewal turns on whether the four hold together. The work is to make them hold together.

To rebuild the layer between the technology and the buyer as a single piece, deliberately, where it had been built in fragments. This is the layer we work on. With leadership, alongside the people already running the company. The first conversation is usually less about a programme and more about understanding the shape of that layer, and where the highest-leverage move actually sits.
Where the work happens

Interconnectivity: Health Tech
A longer read on what’s shaping the sector

The Interconnectivity Series
Drawing Cross-Industries Learnings

Some of the thinking behind that work is in Interconnectivity: Health Tech. A longer read on the structural shifts underneath the announcements, the patterns we are watching, and where the sector is going next.
Other industries

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