Nordic digital therapeutics innovator, Sidekick Health, has successfully completed a $20 million Series A funding round, spearheaded by pan-European venture capital firm Wellington Partners and healthcare-specialized VC Asabys Partners. The oversubscribed investment also saw participation from current investors Novator and Frumtak Ventures.

Established in 2014, the company has developed a gamified digital care platform designed to manage chronic and lifestyle-related illnesses. This platform utilizes digital prompts from a cartoon character to guide patients toward helpful information, encouraging healthier lifestyle choices such as regular exercise and smoking cessation. It also provides tools for treatment management, including medication reminders and remote patient monitoring capabilities for healthcare professionals.

Sidekick Health’s platform caters to a variety of therapeutic areas, offering evidence-based, customized, and gamified digital therapeutics for conditions like diabetes, ulcerative colitis, and smoking cessation.

This year, the company expanded its offerings to include support for individuals with COVID-19 – an acute condition that has presented substantial challenges for healthcare systems.

The ongoing pandemic is broadly increasing the demand for digital care and remote patient monitoring solutions as healthcare providers seek tools to manage patients remotely, further benefiting Sidekick Health’s business.

Despite the gamified approach potentially appearing more appealing to younger, tech-savvy individuals, the company reports successful engagement with patients ranging in age from teenagers to those over 80. Sidekick Health now believes accessibility is key, and its software is designed to integrate with a variety of connected devices.

“The digital health market, and specifically our segment of digital care or digital therapeutics, has experienced significant growth in recent years,” explains CEO and co-founder Dr Tryggvi Thorgeirsson. “The pandemic has undoubtedly accelerated this trend, leading to increased adoption across all market segments, particularly among payers and providers.”

“Healthcare providers, such as hospitals and clinicians, have understandably increased their reliance on digital health tools due to the pandemic. The market was already growing rapidly, but the pandemic has dramatically accelerated that growth, resulting in substantial growth for our customer base over the past six to twelve months.”

Sidekick Health does not disclose specific customer numbers but confirms partnerships with “several” leading global pharmaceutical companies. The platform currently supports approximately 30,000 patients across different therapeutic areas, with Europe representing its largest market to date.

The new funding will be allocated to “further growth,” according to Thorgeirsson – “both in terms of product expansion and accelerating our growth in Europe and the US market.” “We are prioritizing growth and investment at this stage, rather than focusing on immediate profitability,” he clarifies. 

The company plans to expand into new conditions in the coming months, including heart failure, oncology (supporting cancer patients), and various metabolic disorders.

Within the next two years, the company aims to address over 20 different chronic illnesses (along with “a few acute conditions like COVID-19”). 

Thorgeirsson also emphasizes that individuals with chronic conditions often experience multiple health issues simultaneously, making flexibility in managing comorbidities a key focus for the clinician-founded startup.

“The majority of our work centers on chronic, lifestyle-related conditions… however, when COVID-19 emerged, we recognized that the functionality we had developed for chronic diseases was also well-suited for COVID-19,” he states, explaining that the platform has been used to provide coronavirus patients with educational videos on symptoms and “strategies for coping with the anxieties of home isolation,” as well as a reporting system for remote clinical monitoring.

“We found that these [features] were also relevant for this acute condition, and in our home country, Iceland, we were selected by national authorities to support a nationwide program for remotely monitoring and assisting patients with COVID-19. Therefore, it can also be applied to certain acute conditions,” he adds.

In addition to broadening the range of conditions the platform can address, the Series A funding will support further clinical research to validate its effectiveness.

Recent research published by the company included a randomized controlled trial comparing standard care for type 2 diabetes with the same care plus the Sidekick Health platform. (Thorgeirsson reports that the addition of the digital tool to the care pathway resulted in “a very significant reduction in average blood glucose,” which “correlates to approximately a 16% decrease in the risk of mortality and about a 30% reduction in the risk of severe complications such as amputation and blindness”.)

“We will utilize this funding to significantly expand our medical and scientific operations, launching multiple studies across various therapeutic areas,” he tells TechCrunch. “Each condition presents unique aspects that we focus on. For cardiovascular and metabolic conditions, we concentrate on areas like weight management, blood glucose control, and cardiovascular risk factors, while others may prioritize quality of life, fatigue, anxiety, or depression.”

“This summer, we conducted feasibility testing with heart failure patients and observed very promising initial results indicating significant improvements in one of the primary symptoms [shortness of breath]. We even identified a case where remote patient monitoring detected a ‘silent’ heart attack, leading to immediate hospitalization.”

“Overall, I am excited by the breadth of applicability. We began in the cardiovascular space but have rapidly expanded into numerous new conditions over the past two years.”

Regarding the “added value” its platform provides to business customers, as mentioned on its website, Thorgeirsson explains that digital therapeutics offer “multiple value drivers” to pharmaceutical partners.

It’s important to note that digital care/therapeutics tools often encounter regulatory obstacles to direct reimbursement by healthcare payers in many markets. Therefore, such businesses typically need to explore alternative routes to market.

Collaborating with major pharmaceutical companies is one such option. Conversely, some digital health startups aim to directly disrupt the pharmaceutical industry – for example, by offering alternatives to medication (particularly in areas like sleep disorders). However, Sidekick Health views its platform as a complementary treatment that can enhance traditional drug therapies for a wide range of conditions. (The company also believes its b2b2c approach is the most effective way to make its digital therapeutics accessible to a larger patient population.) 

“Improving patient outcomes provides a direct financial benefit for our pharmaceutical customers,” says Thorgeirsson, discussing the value proposition Sidekick Health offers its b2b partners. “If a drug’s development cost between $1 and $3 billion, and we can improve treatment efficacy for patients receiving that therapy by adding our digital companion, that translates to a direct financial benefit in terms of competitive positioning for our pharmaceutical partners.”

“Furthermore, when our pharmaceutical partners discuss reimbursement for their drug with payers, improved patient outcomes are crucial – so it’s the improved patient outcomes, enhanced medication adherence (we know that’s a significant issue; approximately 300,000 people die annually due to non-adherence, which we help address), and valuable insights from real-world data that we can collect.”

The potential for data generated by digital therapeutics to extend the lifespan of existing drug patents is also “a consideration,” according to Thorgeirsson – when asked if part of its ‘value add’ is the possibility of revitalizing pharmaceutical patents by integrating a novel digital companion.

“That is one of the most exciting aspects of our field – working more closely with pharmaceutical companies to create combinations of molecules and digital solutions,” he confirms. “In some cases, this can potentially extend exclusivity or patents. So that’s definitely a significant part of what we’re seeing in the market.”

“This combination, where the molecule addresses certain aspects of the disease and we address others – and the combination is more powerful than either alone.”

Drug development and/or identifying new applications for existing medications is another area where Sidekick Health believes data from its platform can benefit pharmaceutical outcomes.

“Our vision is that any new drug developed in the near future will likely have a digital companion when it reaches the market,” says CMO Gulli Arnason. “[It’s about] getting involved early and launching something with a pharmaceutical company that’s augmented by a digital companion – as well as a more defensive strategy, regarding margins and patents. These two areas are extremely important for pharmaceutical companies.”

Regarding the healthcare payer market, Thorgeirsson notes that it’s “still evolving” in its response to digital therapeutics. (However, the coronavirus pandemic is opening doors as societies accelerate the adoption of digital tools to meet the surge in demand for remote care.)

“We believe it’s important to focus on current value drivers that are not dependent on direct reimbursements from payers, as we recognize that the payer market is still developing,” he adds.

On the competitive landscape, Thorgeirsson argues that Sidekick’s platform-based approach is relatively uncommon – and distinguishes the business from digital therapeutics startups with a more specialized focus. (He identifies France’s Voluntis as one platform competitor, a company that has been ‘embedding connectivity into therapeutics’ for a longer period, though with less emphasis on gamification.)

“There are companies that concentrate on specific elements – such as only medication adherence or one or two particular conditions – but we have a different approach where we believe a platform approach is essential. This is true both from the patient perspective – patients may have two or more conditions, such as obesity, type 2 diabetes, and smoking, and you don’t want one solution per condition; you want a platform that can address them all,” he suggests, adding: “Generally, we don’t see strong competition when you combine gamification, the outcomes we’re demonstrating, and the platform approach.”

The platform approach aligns Sidekick Health with the priorities of its target business partners, he says. “Our business partners share these [priorities]. They have a portfolio of therapeutic areas they address and don’t want one vendor per area but a platform that can tackle the spectrum. And in terms of platform breadth, we don’t see a large number of competitors with that size of a platform.”

In a statement commenting on the Series A, Dr Regina Hodits, managing partner at VC firm Wellington, said: “At Wellington, we are dedicated to improving healthcare for all stakeholders – patients, practitioners, and payers. Sidekick’s team has done a remarkable job of creating a product platform with the potential to achieve this goal on a global scale. We are very excited to support the company with its growth plans.”