Let’s get the not-so-good news out of the way first.

Globally, there has been a 12% decline year-on-year in health-tech investing, from $29 billion in 2019 to $25.5 billion in 2020. The drop has been steeper in India, which saw more than a two-fold decline in the amount invested—from $1.03 billion across 147 rounds in 2019 to only  $405 million across 102 rounds in 2020.

According to data from Tracxn, late-stage companies got a lion’s share of the funds ($173 million or 43%) in India. At the top of the heap were telemedicine providers Practo ($32 million raised in Series D round) and DocsApp ($20 million raised in Series B round), as well as (an AI-based decision-support tool for diagnostics services which raised $25 million in Series A funding). 

There’s a hint of good tidings in the numbers listed above. 

The past year has seen an explosion in the promotion and adoption of online health services. Due to lockdowns and the perceived risks of physically visiting healthcare settings, many people turned to online solutions for their medical needs, thereby accelerating the rise of telemedicine. 

In turn, an increasing number of physicians, diagnosticians, pharmacies, and hospitals in India are adopting tech and AI-driven methods of providing their services and improving access for those in need. These trends, we believe, will continue to extend across sectors in healthcare—including mental health—and will be matched by increased investor interest.

According to our analysis of existing trends, the following four areas will be of interest to health-tech investors in 2021.


An increasing number of people are consulting with doctors remotely through consumer-facing solutions. Practo, for instance, recorded a 600% growth in online consultations between March and August, and in December 2020 reported a 250% increase over a period of six months in its telemedicine subscription plans. 

Mfine, another platform for teleconsultations, reported a 10X surge in demand in November 2020 and is scaling up its operations.

Consumers apart, many physicians—including specialists—have in recent months started to offer remote consultations. For example, 5C Network, which specialises in diagnostics services, has registered a 150% increase since March in the number of radiologists registering on the platform.

In addition to aggregators, major hospitals and diagnostics chains are also leveraging the demand for online services and investing in using remote-consultation tools and improving the online consultation experience for patients.

Artificial intelligence

The lockdown exposed many weaknesses in India’s healthcare infrastructure, including the shortage of physicians and specialists in Tier-II and Tier-III locations. 

Telemedicine has helped bridge the doctor-patient gap to some extent but AI can go several steps further by analysing and interpreting the vast amounts of data generated in online healthcare transactions. 

AI players can offer deeper, faster, and more accurate models and insights, with implications ranging from early prevention and diagnosis to more efficient patient monitoring and treatment. 

The adoption of AI-enabled healthcare in India has been relatively slow, but there is greater scope for acceleration in the context of the pandemic. In July 2020, a hospital in Milan deployed Indian player’s AI solution qRX to interpret lung scans of COVID-19 patients so as to add efficiency and speed to the monitoring of disease progression. 

Predible Health, another deep data science company, deployed a similar lung CT-based AI solution across hospitals in India and the Philippines for Covid screening and monitoring.  

Innovations such as these could have a significant impact in resource-strapped contexts across developing countries. The healthcare insurance sector is also seeing uptake of AI-driven solutions. This is expected to bring down the settlement time considerably and lead to more affordable and relevant products for consumers. 

i3Systems is one such company which is extensively driving AI into the processes of some of India’s largest insurance providers. 

Innovative mental health solutions

Depression, anxiety, and stress have been described as the “silent pandemic” accompanying COVID-19, with people struggling with social isolation, loss of livelihoods, and heightened fear of disease. These issues have given digital mental health solutions fresh relevance. 

For example, mental health AI-enabled app Wysa (which was developed in Bengaluru) saw a 77% rise in new users in February and March 2020 from the same period in 2019, and as of April reportedly had 100,000 users opting for its “health anxiety and social distancing tool packs”. 

In July, three providers of online mental health services—Dost, ePsyclinic, and Mind Piper—received Rs 95 lakh from ACT Grants for their work in the area of COVID-related anxiety issues. Mental health has always been a hard area to address. 

Cultural nuances around recognising and seeking help and a lack of expert psychologists and psychiatrists have been big challenges. With mental health issues increasing rapidly, investors will be very interested in supporting entrepreneurs building innovative scalable mental health solutions.

Cloud labs

Cloud-enabled COVID-19 test labs have been described by entrepreneur and investor Graham Weston as the crucial tool needed for solving the “core problem” of “testing speed”—which is important for a disease that is known to spread exponentially. 

In India, HPE launched four cloud-enabled COVID-19 test labs and OPD centres to enable “quick and clean” testing and to reduce stress on the healthcare infrastructure. Such initiatives are likely to gain traction in the coming year, especially with schools eventually re-opening and an increased need for mass testing. 

As the year winds to a close, investor bullishness is rising. The health-tech industry, in particular, is poised for significant growth globally with increasing demand for digital platforms and tools in the wake of the pandemic. 

In India, the government’s Telemedicine Practice Guidelines have provided the necessary legal framework and the National Digital Health Mission, according to a BCG and FICCI report, could “unlock an incremental value of Rs 200 billion for the healthcare industry”. Despite this climate of uncertainty, one thing is clear: the time for digital and AI in healthcare is now. 

Radha Kizhanattam is partner at Unitus Ventures.

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