Marina del Rey-based Wellth has raised $20 million in series B financing.
The funding round was led by San Francisco-based venture capital firm SignalFire. Another major contributor was Frank Williams, founder and former chief executive of Arlington, Virginia-based Evolent Health. Williams has joined Wellth as board chairman.
Several existing investors contributed additional funds for this round, which was announced last month and brings the total amount raised by the company to about $40 million.
Wellth, which was founded in 2014, has developed a mobile phone app that reminds patients to take medications and requires them to submit photos of themselves with the pills or dosages in their hand, ready to take. Those patients achieving high levels of compliance get rewarded with payments on a stored-value credit card they receive when they sign up.
Underlying this is Wellth’s behavioral health platform. Patients are tasked to snap a daily photo of themselves taking their medications, monitoring their glucose levels or practicing other healthy behaviors and then uploading these photos to Wellth’s mobile app. According to the company, this daily interaction turns behaviors into habits, which ultimately leads to lasting change and more positive health outcomes.
“At the core, we’re removing barriers and giving patients the motivation to do what’s best for their health,” said Matthew Loper, Wellth’s chief executive and co-founder.
The aim is to reduce the rate of non-compliance when it comes to patients taking prescribed medications. Studies have shown that between 30% and 50% of medications prescribed are not taken in the right dosages or correct frequency. As a result, the underlying conditions that the medications are prescribed to treat persist, costing the nation’s medical system up to $500 billion a year in additional – and avoidable – treatment.
Wellth’s customers are health care payors – chiefly insurance companies and health care providers – that stand to save the most as patient adherence to medication regimens increases. Wellth charges its health care payor customers for the incentives plus an “adherence fee,” which is presented as a portion of the savings from avoided health care treatments and hospitalizations when medications are taken properly.
According to Wellth’s announcement, its adherence platform has achieved an average 42% reduction in inpatient utilization and a 29% average reduction in emergency room visits.
“Wellth has solved one of the hardest and most fundamental challenges in health care – motivating patients to take action and do what’s best for their health,” said Yuanling Yuan, principal with SignalFire and leader of the venture capital firm’s health care investment strategy.
Among the returning investors for this round were the Social Entrepreneurs Fund, CD Venture and the Partnership Fund for NYC.
