The news: Chronic condition management company Omada Health became the second prominent digital health company to file to go public this year, signaling a turn for the industry after a few years of hesitancy to enter public markets. Virtual physical therapy company Hinge Health filed to go public in March and this week said it plans to raise upwards of $437 million for its IPO.
Zooming in on Omada: Its virtual care programs for conditions such as hypertension and diabetes are primarily sold to employers, health plans, and pharmacy benefit managers (PBMs). These stakeholders then offer the digital health solutions to their own employees and members. Omada said in its SEC filing that it has 2,000 customers who have enrolled 679,000 members in one or more of its programs.
The company acknowledged it’s been piling up losses over the years and that it may never be profitable.
- Omada slashed its net losses from $67.5 million in 2023 to $47.1 million last year.
- Its Q1 2025 net losses were $9.4 million, down from $19 million from the same period last year.
- Omada’s revenues increased 38% year over year in 2024 and by 57% in Q1 compared with the same period last year.
- 60% of Omada’s revenues come from two health plans or PBMs (Omada wouldn’t specify which) that are affiliated with Cigna.
Zooming out: Digital health IPOs significantly waned over the last few years, so Hinge and Omada making public entrances in the first half of the year marks a significant turnaround.
The bigger picture: We’re in a period of market volatility due to President Trump’s tariffs, which are causing angst for companies in a range of industries. Healthcare is not recession-proof nor immune to tariff concerns—but the sector is more resilient than others in the face of economic uncertainty since demand for medical services and treatment never goes away.
Some companies that were planning IPOs this year have pressed pause until later quarters or even 2026 until they have more clarity on the true impact of tariffs, per an April EY report.
- For instance, fintech company Klarna halted its IPO plans in response to Trump’s tariff announcements.
The bottom line: Omada and Hinge don’t seem too concerned with the current market volatility, but they have other challenges unique to the sector—namely, validating that digital health programs for chronic condition management can be worthwhile long-term investments for employer and payer customers.
- A pair of 2024 reports from the Peterson Health Technology Institute (PHTI) found that most diabetic and hypertension tech solutions—including Omada’s—don’t provide enough medical benefit relative to their costs.
- PHTI did give higher grades to virtual physical therapy tools, however.
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