Omada Health, Developer of Comprehensive Digital Chronic Care Programs, Files for IPO After Raising Over $256M

In recent years, body-image trends such as the “A4 waist,” “ant waist,” and “vest line” abs have emerged one after another. Social aesthetics are shifting from a thin-is-beautiful ideal toward the pursuit of a healthy physique, becoming more diverse and health-oriented. However, regardless of which side of the body-management spectrum one leans toward, obesity remains an unavoidable key issue.

According to the "Report on the Nutritional Status and Chronic Diseases of Chinese Residents (2020)," the issue of overweight and obesity among Chinese residents has become increasingly prominent, with the prevalence and incidence of chronic diseases showing an upward trend. The rates of overweight and obesity have continued to rise across all age groups in both urban and rural areas, with more than half of adult residents being overweight or obese.

Overweight and obesity have also become a major public health issue affecting the physical and mental well-being of children and adolescents in China. In October 2020, the National Health Commission, together with five other departments including the Ministry of Education, formulated the “Implementation Plan for the Prevention and Control of Obesity in Children and Adolescents” to curb the prevalence of overweight and obesity.

# What Is Obesity?Obesity is not merely an increase in body weight; it is, in fact, a chronic metabolic disease resulting from the combined effects of genetic factors, environment, and individual dietary and exercise habits. Excessive accumulation of fat relative to muscle mass places stress on the skeletal system and internal organs, while also increasing systemic inflammation. Furthermore, obesity can precipitate various underlying health issues, such as cardiovascular disease, type 2 diabetes, musculoskeletal disorders, and sleep apnea.

# How to Treat Obesity?Currently, digital therapeutics that deliver remote digital health guidance via internet-connected devices have been proven to be an effective approach for the prevention and management of overweight and obesity. As the obese population continues to grow, digital therapeutics for obesity will emerge as a highly dynamic sector within healthcare.

According to data from VCBeat, from 2011 to June 2020, the total amount of publicly disclosed financing for global digital therapeutics companies specializing in obesity reached $764 million (excluding IPOs, private placements, etc.). Among them, Omada Health ranked first with a total financing amount of $256.5 million.

Omada Health is a technology company founded in 2011 that helps people change their lifestyle behaviors through guidance, thereby preventing chronic diseases and reducing disease incidence. It provides users with comprehensive digital care programs to achieve their health goals through sustainable lifestyle changes.

According to Crunchbase data, Omada Health has raised a total of $256.5 million across nine funding rounds. Its Series B financing alone exceeded $10 million, and the most recent round occurred in May 2020, with specific details undisclosed. In the same month, Omada Health acquired the telehealth service platform Physera for $30 million to provide musculoskeletal (MSK) programs to its customers.

 Source: Crunchbase

Obesity is a major risk factor for conditions such as type 2 diabetes and musculoskeletal (MSK) disorders. Since its inception, Omada Health has focused on the prevention and management of diabetes. Its inaugural program, Prevent, digitizes preventive care through a 16-week online human-coached intervention, helping overweight individuals lose weight to reduce their risk of developing type 2 diabetes.

Over the past decade, Omada Health has continuously expanded its product portfolio. Currently, its digital care programs have extended beyond diabetes care to encompass five key areas, adding musculoskeletal (MSK) care, prevention programs for diabetes and heart disease, hypertension care, and behavioral health.

Evidence-Based Nursing Pathway

Omada Health has researched, tested, and created evidence-based care pathways for a variety of chronic conditions it serves, including type 2 diabetes, hypertension, high cholesterol, anxiety, and depression. By integrating data, behavioral science, clinical expertise, and product design, these pathways address users’ chronic disease management needs and help reduce healthcare costs.

Source: Omada Health Official Website

Its digital nursing care can provide health guidance to patients anytime and anywhere, with the following advantages:

Cost Savings and Expense Reduction:Participants in the Omada care program can recoup their healthcare costs within just one year, with average savings of over $1,000 per enrolled user. Among these, the prevention program saved an average of $1,169 in medical expenses per user.

High Member Engagement:Omada’s care plans leverage smart connected devices to continuously access, track, and provide feedback on user engagement 24/7. Furthermore, users are encouraged through one-on-one professional coaching and online communities, motivating them to make daily lifestyle changes. On average, users engage with the program 31 times per week, or 4.5 times per day. In 2019, Omada users sent over 225,000 thank-you notes to the company.

Effective Health Outcomes:Omada has demonstrated the effectiveness of its care programs in 16 peer-reviewed studies. By delivering personalized care driven by over one billion data points, it helps users find the motivation to manage their chronic conditions and improve their health, thereby establishing healthy lifestyle patterns. Among these outcomes, users at risk for diabetes achieved an average weight loss of more than 5% within one year.

Streamlined Participation Process

Omada’s care plans are supported by dedicated care teams, devices, peers, and interactive sessions. They promote genuine user engagement through professional health coaching, weekly interactive sessions, and app-based progress tracking. The enrollment process is as follows:

First, complete the registration.Users are required to complete a 5-10 minute application, which Omada will use to assess eligibility. Subsequently, users can set up their accounts and download the Omada app.

Secondly, proceed with program implantation.Omada will grant users access to the application based on their accounts and send corresponding monitoring devices. These devices are pre-configured to automatically sync with user accounts, providing personalized management plans tailored to each user.

Finally, the user receives the corresponding services.Omada will assign a dedicated health coach to each user, providing one-on-one coaching and interactive courses to help users adhere to their care plans.

From Omada Health’s perspective, care is a vital component of healthcare. The company was founded to help patients recognize their capacity to lead healthy lives. Its digital care program combines data-driven expert coaching, connected devices, and courses tailored to specific conditions.

Diabetes and Hypertension Care and Prevention Plan

Omada’s diabetes care program, hypertension care program, and prevention programs for diabetes and heart disease follow largely similar models. They all utilize one-on-one coaching from health coaches, Certified Diabetes Care and Education Specialists (CDCES), or hypertension specialists to help users manage and prevent the respective conditions.

From the outset of the program, users can collaborate with their health coaches to develop plans for managing blood glucose and blood pressure, as well as addressing exercise, monitoring, and medication. Through the Omada app, they receive weekly tailored lessons covering topics such as dietary choices, exercise regimens, and risk education specific to their conditions.

Then, Omada tracks users’ weekly course progress anytime and anywhere through digital scales, blood glucose meters, and other devices shipped to them in advance, while users can also communicate with their health coaches at any time.

Musculoskeletal (MSK) Care Plan

Currently, Omada leverages Physera to provide users with physical therapy for musculoskeletal (MSK) conditions, addressing their systemic joint and muscle needs. This personalized one-on-one care enables users to receive video consultations from professional physical therapists via mobile devices, regardless of location, and obtain individualized treatment plans without visiting a clinic.

Furthermore, this care plan can reduce the use of opioids, specialist outpatient visits, surgical procedures, and other treatments, thereby lowering patients' medical expenses.

Behavioral Health Plan

Omada’s behavioral health program focuses primarily on caring for users’ mental and emotional well-being. The Omada Mind app offers soothing therapeutic audio content and tracks users’ stress levels through regular check-ins. Users can discuss their needs with their Health Coach, set daily goals, and receive everyday emotional health support. Health Coaches provide continuous emotional support by delivering round-the-clock, one-on-one care.

Sean Duffy, co-founder and CEO of Omada Health, stated, “Tens of millions of people now have access to Omada’s comprehensive suite of chronic disease management programs.” The company collaborates with corporate employers and health systems, with partners including Cigna, Kaiser Permanente, and Blue Cross Blue Shield of Minnesota.

According to the report “Digital Therapeutics & Wellness: Disruption, Innovation Opportunities & Forecasts” released by market research firm Juniper Research, the digital therapeutics market is poised for rapid expansion over the next five years. The largest applications of digital therapeutics will be in diabetes and obesity, with revenues projected to exceed $19 billion by 2024.

Chronic diseases are non-communicable diseases caused by lifestyle factors, environmental risk factors, and other contributors, characterized by high incidence rates, high mortality rates, prolonged disease courses, and complex etiologies. As representative chronic conditions, diabetes and obesity are discussed below with a brief overview of the leading companies in the digital therapeutics market for these two disorders.

Regarding digital therapeutics for obesity, development is relatively mature compared to other diseases. According to data from VCBeat Orange, the top five funded companies in this sector, in addition to Omada Health introduced in this article, include medical device developer IntraPace, health service provider Noom, weight-loss medical device developer Allurion Technologies, and wearable device developer Fitbit.

Regarding digital therapeutics for diabetes, data from VCBeat Orange shows that the top five funded companies in this sector are: Livongo, a chronic disease management service provider; Dexcom, a developer of glucose monitoring systems; Tandem Diabetes, a developer of diabetes medical devices; Intuity Medical, a developer of blood glucose monitoring devices; and Zhiyun Health, a platform for diabetes chronic disease services and health management.

In summary, the field of digital therapeutics for chronic diseases boasts broad prospects. Early entrants have already developed relatively mature product technologies and business models, while new players continue to enter the market.

Omada CEO Sean Duffy stated, "Digital care should be the first choice for patients with chronic conditions, mental health issues, and other needs. Integrating digital therapeutic solutions enables Omada to better address urgent current demands, accelerate the development of a comprehensive care experience, and meet the needs of both partners and patients."