What you need to know
The company's digital diabetes management offering is attracting interest around Asia as government health services grapple with aging societies and mounting costs.
Taiwan-based digital health platform Health2Sync announced this morning (Dec. 6) that it had secured US$6 million in Series B investment led by Japanese insurance group Sompo Holdings.
Sompo joins existing investors Alibaba and WI Harper as a strategic partner that will help Health2Sync establish operations in Japan.
The investment, among the top 10 fundraising events of the year for a Taiwanese startup, paves the way for regional expansion, focusing on Japan, but also Malaysia, as well as Hong Kong and Singapore.
Taipei-based Health2Sync, founded in 2013, is known for its digital diabetes treatment platform, but has its eye on expanding into blood pressure related treatments, extending into management of hypertension, the consequences of which include cardiovascular diseases such as stroke, Ed Deng, co-founder and CEO, told The News Lens.
Health2Sync benefited from a partnership with Taiwan’s Ministry of Health and Welfare launched in 2016 that offered patients in several cities access to its platform, which includes an app, a cable to attach glucometers to smartphones and an analytics element that crunches the data and provides recommendations. The pilot helped establish Health2Sync’s credibility overseas by providing data-driven evidence of the efficacy of its solution.
The company met Sompo in Singapore at the Japanese company's "insurtech" digital lab, Deng said. “Things accelerated in the last 12 months because of the policies and need of Japan’s economy, which [like Taiwan] has an aging society. Single-largest-payer systems [such as the national health services in Taiwan and Japan] are always looking to minimize costs arising from chronic disease complications.”
Taiwan’s efforts to reduce costs associated with diabetes are being mirrored around the region. Japan is offering private firms policy-led incentives to provide diabetes treatments under its “Medical Cost Optimization Plan”, while planning to expand a remote treatment program that reimburses the healthcare provider in 2018. Singapore is moving into phase two of a “war” on the disease declared last year.
“When it comes to digital health, government policy is extremely important – having an established single-payer system, the maturation and market readiness, the awareness and timing to accept and bring in digital health all needs to be there,” Deng said, adding that while that those thing are all true in South Korea as well, the presence of established players like Samsung and a fertile domestic startup ecosystem present a significant barrier to entry.
Health2Sync is also looking to drive traction in Malaysia, where it established operations six months ago, with an eye to capturing a market where the prevalence of diabetes runs at about 15 percent, compared with 10-12 percent in Japan and Taiwan.
Deng, a Taiwanese-American former Lehman Brothers employee, also urged Taiwan's government to reinstate tax incentives for venture capital investment to help improve fund inflows to the island, but cautioned that the primary issue for Taiwanese companies is investor confidence in their international scalability. " Taiwan had a vibrant VC community during its 'hardware heyday' but the problem is the lack of visibility for investors over whether or not Taiwanese teams can really bring products or services abroad," he said.