2021 Healthcare Prognosis

For our fifth annual survey, we once again tapped our network of pundits to weigh in on the healthcare industry’s news, trends and challenges. With the global pandemic, 2020’s survey results offered insights into the sentiment elicited by Covid-19, as well as predictions and questions about its impact on the presidential election, return to work and vaccines. It was the first year we conducted multiple surveys, and dramatic changes in opinion were captured as the country locked down and we slowly came to understand what we were up against. We were SO, SO wrong about the stock market as it quickly recovered from March lows and soon reached new heights, and less than 50% predicted that an effective vaccine would be available by the end of 2021. But we got more right than wrong as the election did swing to Biden, the GDP dropped more than 2% for 2020, and telemedicine broke-through, emerging as a lasting component of patient care.

This year, respondents weighed in on the impact of Covid-19, vaccine rollouts and passports, how the Biden administration will shape the future of healthcare, and the outlook for health IT startups in 2021 and beyond.

Our commentary on the most interesting findings is presented below, followed by the full results.

I. VACCINATIONS

Just over a year into the pandemic, over 300 million vaccine doses have been administered in the U.S. and, as a result, the number of Covid-19 cases has steadily declined. With new variants of Covid-19 detected in various countries, time will tell how the current vaccines hold up against these new variants and if booster shots can be developed quickly enough, before current vaccination protection wanes.

VACCINE CONFIDENCE

Nearly half of our survey respondents believed Covid-19 vaccinations would provide protection for at least 12 months. An overwhelming majority (96%) also answered that a Covid-19 booster or variant shot would be available before current protection wanes. And given the positive results from Pfizer and Moderna so far, the majority (63%) of respondents did not believe that there would be an alternate vaccine that would replace these two as the standard of care in the near future.

A slim majority of respondents (53%) felt that AstraZeneca’s vaccine would be approved in the U.S. This one will be interesting to track as the survey’s authors would take the under on that bet.

VACCINATING OUR YOUTH

Nearly 60% of survey respondents answered that vaccines will be required for kids to attend school in person. Many uni versities, including the entire University o f California system and Stanford, have m andated vaccinations for all students, fa culty and staff for the fall term. On May 10 , the F.D.A. authorized the use of the Pf izer- BioNTech vaccine for children 12 -15. Moderna also recently announced its Covid-19 vaccine as 100% effective in te ens.

STRONG SUPPORT FOR PASSPORTS

The FDA’s emergency use authorizations specify that each person being vaccinated must give consent, which makes vaccine mandates a gray area for businesses where gettin g consensus, much less imposing things, is uncommon. However, more than half of re spondents agreed that vaccine passports w ould be necessary to reopen and trav el safely, and considered it acceptable for cer tain employment opportunities, such as el dercare. A small number of respondents expressed concerns over possible opportuniti es for injustice or invasion of priva cy (5%).

AT-HOME TESTING FIZZLES

Amazon has voted on the side of “New Normal” with their plans to launch a diagnostics business starting with a Covid-19 testing kit. However, the majority of respondents felt that at-home testing is a Covid-19 fad (58%).

II. RETURN TO WORK

Relaxed health guidelines from the CDC signal a return to work is on the horizon. Today, companies are grappling with the best policies and procedures to ensure a smooth and safe transition back to the office.

ANTICIPATING HIGH VACCINATION RATE

82% of respondents believe that over 75% of their organization would be v accinated in 2021, which indicates strong c onfidence among business leaders in t he effectiveness and adoption rate of the vacc ines.

III. BIG TECH AND THE FUTURE OF HEALTHCARE

The impact of Covid-19 has drawn increased attention towards improving the healthcare system, with big tech companies such as Apple and Google making big bets on their ability to innovate.

BULLISH ON APPLE AND GOOGLE

Most respondents expect big tech to make big bets in the healthcare space, with Apple and Google favored to take action. There were a few write-ins for Microsof t to be a player, bolstered by their recent acquisition of Nuance. Whether any will be successful, given no one but Amazon has shown any propensity, is another quest ion entirely.

SPACTACULAR OR SPACOCALYPSE?

SPACs boomed in Q1, but most believe that they’ll be, at best, a niche approach moving forward, especially with the SEC watching SPACs more closely, deteriorating economics for sponsors and, most importantly, poor after-market performance by recently SPAC’ed companies.

HEALTH OF HEALTH IT IPOS

Perhaps signaling an expected end to the bull run, more than company-specific concerns, respondents predict that the enterprise value for almost all companies on the list would be lower by year end, with Accolade the lone outlier. Clover Health received the most concern as 70% predicted their enterprise value would be lower.

TIGER GLOBAL BETS BIG ON HEALTH IT

Tiger Global roared into health IT in Q4 2020 and continues to be a growth investor of choice as evidenced by the number of Q1 2021 financings. Among its health IT investments, Aledade and Komodo Health received the highest scores from respondents in terms of long-term potential.

Full Survey Results

More than 240 respondents from health IT startups, large employers, insurance companies, healthcare providers, academics, government, investors and professional service providers conducted the survey between April 27, 2021, and May 7, 2021. If you would like to view the results of our previous surveys, you can find them here:

2020 Healthcare Prognosis

2019 Healthcare Prognosis

2018 Healthcare Prognosis

2017 Healthcare Prognosis

1
By EOY 2021, consensus will say that Covid-19 vaccination provides protection (both general durability and efficacy against variants, known and unknown) for:

1% <6 months
5% 6 months
45% 6-12 months
44% 12-24 months
3% >24 months

2
WWill a useful Covid-19 booster/variant shot be available before protection from the current vaccines wanes?

96% Yes
4% No

3
If approved by the FDA for kids 12+, will kids be required to get vaccinated for Covid-19 prior to the 2021/2022 school year?

42% Vaccines will not be required by schools for kids
19% Vaccines will be required for kids aged 16+
39% Vaccines will be required for kids aged 12+
0% Vaccines will be required for all kids

4
Will the AstraZeneca vaccine for Covid-19 be approved in the US?

53% Yes
47% No

5
Will a non-Pfizer/Moderna vaccine be standard of care for Covid-19 in 2022?

37% Yes
63% No

6
Will monoclonal antibodies gain traction?

17% Yes, as frontline therapy for most newly infected people/std>
11% Yes, as prophylaxis for high-risk patients
58% Yes, as treatment for high-risk patients
14% No

7
How do you feel about Covid-19 vaccine passports? (select all that apply)

58% Necessary to reopen and travel safely
63% Acceptable for certain employment opportunities (i.e. elder care)
12% Create too many opportunities for injustice
5% An invasion of privacy
5% Other

8
We will be wearing masks in public (outdoors or indoors)...

19% Only until July 4th, when most Americans are vaccinated
20% The rest of 2021o/td>
34% For the foreseeable future when in crowded places
27% For the next 2 years on planes and high risk settings

9
Will at-home testing be a Covid-19 flash in the pan or become mainstream and replace many of the tests done at Labcorp and Quest?

58% Covid-19 fad
42% New normal for routine blood tests

10
What percentage of employees in your organization will be vaccinated for Covid-19 in 2021?

1% <50%
17% 50-75%
38% 75-90%
44% >90%

11
As the Covid-19 vaccine rollouts accelerate, when is your company thinking about returning to full-time, in-person work?

11% We are already back in the office
62% Planning to be back in-person by fall 2021
13% Planning to be back in-person by January 2022
14% No current plan to return to the office

12
What will a return to work look like for your company? (select all that apply)

42% Vaccine required unless medically unable
44% Wearing masks in common areas
53% New policies around going to the office with any symptoms (not allergies)
82% Shifting to a hybrid model with some people in the office and others continuing to work from home full/part time
25% Staggering teams' in-person days at the office to reduce daily headcount

13
Amazon Care is Amazon’s latest foray into healthcare. By 2022, it will…(select all that apply)

45% Be used only by Amazon employees
40% Be offered to Amazon Prime members on a fee-for-service basis
18% Gain traction among large employers and take market share and impact valuations of innovators
18% Be forgotten

14
Will big tech make big bets on healthcare?

17% Yes, Apple will expand beyond the watch
16% Yes, Google will go beyond offering cloud services and make a big acquisition
2% Yes, Facebook will build healthcare-oriented apps and launch VR-assisted therapies on Oculuso/td>
44% Yes, all of the above
16% No, none of the above
5% Other

15
SPACs will… (select all that apply)

26% Become a more common way for companies to go public long term
55% Be a niche approach for companies that are less attractive for traditional IPOs
19% Be the path of last resort for companies without other financing options
28% Drift back into obscurity after a series of flops

16
There were many health IT IPOs in 2020. What is your prediction for the enterprise value of the following companies on 12/31/21? [Current market cap 4/23/21]

  Oscar Health [$4.6B]
39% Higher
61% Lower
  Accolade [$2.9B]
58% Higher
42% Lower
  Clover Health [$3.6B]
30% Higher
70% Lower
  GoodRx [$15.5B]
45% Higher
55% Lower
  American Well [$4.5B]
41% Higher
59% Lower
  Hims & Hers Health [$2.1B]
41% Higher
59% Lower
  Oak Street Health [$14.6B]
42% Higher
58% Lower

17
Rank the following potential 2021 IPOs based on your excitement about their long term fundamentals:

  Privia Health
  Total 3.13
21% 1 23% 2 20% 3
21% 4 15% 5  
  Bright Health
  Total 3.58
33% 1 26% 2 15% 3
17% 4 9% 5  
  Agilon Health
  Total 3.03
15% 1 22% 2 26% 3
23% 4 14% 5  
  VillageMD
  Total 3.19
22% 1 23% 2 18% 3
25% 4 12% 5  
  Ro
  Total 2.11
11% 1 5% 2 19% 3
15% 4 50% 5  

18
Tiger Global has burst onto the health IT scene. Rank their recent growth round investments based on long term success potential:

  Komodo Health
  Total 4.47
23% 1 16% 2 17% 3
11% 4 10% 5 11% 6
12% 7  
  Hinge Health
  Total 4.3
12% 1 16% 2 19% 3
21% 4 13% 5 13% 6
6% 7  
  Cityblock Health
  Total 4.39
16% 1 12% 2 19% 3
17% 4 22% 5 10% 6
9% 7  
  Virta Health
  Total 4.3
13% 1 19% 2 17% 3
20% 4 9% 5 13% 6
9% 7  
  Aledade
  Total 4.5
24% 1 18% 2 9% 3
11% 4 20% 5 9% 6
9% 7  
  Cedar
  Total 3.23
8% 1 11% 2 9% 3
10% 4 14% 5 26% 6
22% 7  
  DispatchHealth
  Total 3.33
11% 1 13% 2 12% 3
8% 4 8% 5 14% 6
34% 7  

19
What 2020/2021 growth rounds would you have invested in? (choose up to 3)

19% Komodo Health @ $3.3B
18% Hinge Health @ $3B
36% Cityblock Health @ >$1B
29% Virta Health @ $2B
44% Aledade @ $2.1B
18% Cedar @ $3.2B
27% DispatchHealth @ $1.7B
17% Ro @ $5B
11% Color @ $1.5B
44% Lyra Health @ $2.3B

20
The end of Covid-19 could result in steep reductions in growth for certain health IT segments that grew significantly during the pandemic. Which segments will be affected? (select all that apply)

54% Telemedicine
65% Lab testing
18% Mental health
18% Virtual care for diabetes
36% Virtual care for musculoskeletal disease
3% Other

21
Will the Biden administration tackle high drug prices?

6% Yes, as a way to fund infrastructure spending
19% Yes, as a CMMI demonstration
65% No, they will try but not be able to get a bill through the Senate
10% No, public sentiment is pro-pharma thanks to Covid-19 vaccines and therapeutics

22
Which are the largest challenges to health IT innovation in the next 12 months? (select all that apply)

28% Economic uncertainty
12% Funding
36% Regulatory changes
54% Talent/hiring
39% Competition
39% Recovery from Covid-19

23
Over the next two years, the creation of new health IT companies will…

31% Increase significantly
50% Increase somewhat
15% Stay the same
4% Decrease

24
My organization is making a conscious effort to ensure diversity at all ranks. Our team is now...

18% No more diverse than we were one year ago
42% A little bit more diverse than we were one year ago
31% Moderately more diverse than we were one year ago
9% Dramatically more diverse than we were one year ago

25
Which category best describes your employer?

19% Health IT provider
4% Large employer
7% Insurance company
10% Healthcare provider
3% Academia
1% Government
28% Investor
15% Professional services
13% Other