The news: Digital musculoskeletal (MSK) therapy unicorn Hinge Health scooped up Enso, the developer of an app-based wearable that delivers electrical stimulation treatment to relax patients' muscles and is used in over 100 US medical centers like Stanford and Harvard, per Fierce Healthcare.
Why this could succeed: We predicted M&A activity would heat up in the musculoskeletal market this year—partly because employers and payers are looking for ways to stave off the long-term costs of chronic pain.
The bigger picture: Doctor recommendations are a key way MSK therapy tech developers can boost adoption of their devices, but docs aren’t prescribing them due to a lack of insurance coverage—pursuing Medicare Advantage (MA) payer tie-ups is a smart way to address this barrier.
That’s why Hinge Health’s plan to pursue Medicare partnerships this year is a smart one: The startup achieved a $3 billion valuation back in January, at which time it said it would use the funds to broaden its treatment capabilities (a la via its Enso acquisition) in addition to paving its way into the MA space.
In fact, its Enso acquisition fits neatly within its plan to score new commercial MA partners: The acquisition diversifies Hinge’s offerings, which will be attractive to more commercial MA payers so it can expand beyond its current list of insurers, which includes names like Consortium Health Plans. This should help address docs’ pain points with a lack of payer coverage for digital MSK tech—and in turn, convince more clinicians to widely recommend the tools.
What’s next? Hinge Health’s CEO and cofounder Daniel Perez told MobiHealthNews its latest funding haul will let it “go public on a more flexible timetable in 2022.” And a public debut would equip Hinge Health with a considerable cash store to aggressively pursue additional M&As, giving it a competitive advantage over private rivals like Sword Health.