Healthcare activities of Big Tech and retail players in Q4 2023

Note: Activities refer to initiatives by the above companies across industries under SPEEDA Edge’s Health & Wellness and Pharma & Life Sciences verticals

Source: Source: Compiled by SPEEDA Edge

Key takeaways

• Overall activity of Big Tech and retail players picked up during Q4 2023. In particular, activities among retailers witnessed an uptick during the quarter, accounting for 33% of all activities during Q4 (up from 15% during Q3 2023). 

• Among retailers, CVS Health was the most active. The pharmacy retailer accounted for nearly a third of all retail activity during Q4 2023 and 11% of all healthcare activity. CVS Health was the only retailer making investments during Q4, making as many investments as all of Big Tech during the quarter across areas like primary care and holistic care.

• Alphabet’s dominant presence in healthcare continued. The tech giant accounted for 33% of all Big Tech activity and 22% of all healthcare activity. Primary care remained the main focus, with half of its activities concentrated in this area. Within primary care, Alphabet showed interest in areas such as Hospital Management and Telehealth while also broadening its focus into other areas such as AI Drug Discovery, Precision Medicine, and Mental Health Tech.

• Through Google Cloud, Alphabet launched MedLM, a family of GenAI models specifically designed for medical applications. The new models, which have been specifically trained on healthcare data, are tailored for specific use cases, such as answering medical questions, drafting summaries, and even pre-clinical research. The new solutions are expected to revolutionize medical documentation, drug research, and patient care experiences, spurring further interest in leveraging GenAI capabilities to unlock more use cases in the healthcare space.

• Despite the lifted ban, Apple's legal woes over the Apple Watch patent continue. The iPhone maker was forced to pull its latest smartwatches from its US stores following a ban by the US International Trade Commission (ITC) in December over an alleged patent infringement on technology that can read a person’s blood oxygen. While the ban has since been lifted through an interim stay until January 10, its legal battle continues in anticipation of a permanent overturn of the ban.

• Microsoft leveraged partnerships to consolidate its healthcare presence. After unveiling its new AI and GenAI features in its products targeted at the healthcare sector, the tech giant actively pursued partnerships with early adopters to leverage new solutions and capabilities to advance their most prominent use cases. 

• Investment activity picked up during Q4 2023, accounting for 22% of Q4 activities (up from 15% during Q3 2023). Alphabet and Amazon were Big Tech players that channeled investments in the healthcare space through their corporate venture capital arms. Investment activities of retailers, which were paused during Q3 2023, improved and accounted for half of all investments tracked during the quarter.

• M&A activity continued to be muted. M&A activity during Q4 mirrored the slump observed in the previous quarters, as companies continued to take a backseat on M&As after a period of heavy consolidation. A rumored deal between Walmart and ChenMed is also yet to come to fruition during Q4.

Big Tech and retailer activity during 2023 by quarter

Number of activities by company during Q4 2023

Acquisitions: Muted activity for the third consecutive quarter; no further update on Walmart-ChenMed deal

Partnerships: New GenAI products spur Big Tech collaborations

Big Tech

• Microsoft unveiling new AI and GenAI features for healthcare organizations paved the way for collaboration. Following the launch of its new data solutions, Microsoft entered partnerships with Northwestern Medicine, Arthur Health, and SingHealth, who were early adopters of the platform and helped Microsoft advance some of its most prominent use cases. Microsoft also collaborated with Mass General Brigham to deploy one of the three new GenAI-powered models in Azure AI Health Insights focusing on radiology and partnered with Atrium Health to deploy the DAX copilot medical transcription service.

• Alphabet continues efforts to integrate GenAI into the healthcare sector. During the quarter, the company entered partnerships with care.ai and Augmedix to integrate Google Cloud's GenAI tools to streamline workflows and enhance operational efficiencies. Alphabet also partnered with Insmed, an AI drug discovery company, to leverage Google Cloud's AI technology to efficiently develop new therapies. In addition, the tech giant collaborated with Georgiamune (through its subsidiary, Verily) and the New York Center for Rare Diseases to fuel advancements in Precision Medicine.

• Amazon leverages One Medical to deepen ties with hospitals and health systems across the country. During Q4 2023, through One Medical, the tech giant entered partnerships with Virginia Mason Franciscan Health, Hackensack Meridian Health, and the Health Transformation Alliance to expand access to its primary care services.

• Oracle continues to extend its healthcare technology offerings. These included partnerships with United Medical to deploy Oracle Health EHR to streamline workflows and processes for health practitioners through a more intuitive platform. It also collaborated with North Memorial Health to deploy Oracle Fusion cloud applications to improve operational efficiency, reduce costs, and enhance the employee and patient experience by streamlining finance, supply chain, and HR processes.

Summary of Big Tech players’ partnerships in Q4 2023

Source: Compiled by SPEEDA Edge

Retail

• Walmart continued to partner with healthcare systems to improve access to primary care. During the quarter, the company announced its first health system partner, Orlando Health. The collaboration aims to enhance patient care coordination in the Orlando area. Walmart also partnered with Ambetter to help deliver quality, affordable healthcare options in new locations across Florida. In addition, the company entered an agreement with RadNet to establish diagnostic imaging centers at selected Walmart locations. This initiative aims to enhance awareness and accessibility of breast health services.

• Best Buy continued its drive to improve home-based care. During Q4 2023, the company collaborated with Mass General Brigham and Biobeat to explore new solutions to improve the home-based care experience. The partnership with Mass General Brigham will focus on delivering new solutions to enhance the experience for patients receiving home-based care, while the partnership with Biobeat will focus on remote patient monitoring solutions by leveraging wearable technologies.

• Walgreens announced its first retail clinic collaboration with a health system in New England. The collaboration was made with Hartford HealthCare to introduce health clinics at selected Walgreens outlets. During the quarter, the company also allied with RxSense, a medication access and transparency technology company, to launch a digital marketplace designed to help consumers reduce their medication expenses.

Summary of retail players’ partnerships in Q4 2023

Source: Compiled by SPEEDA Edge

Investments: Retailers make a comeback, as CVS Health leads the pack

Big Tech

• Alphabet, through its venture capital arm, Google Ventures (GV), continues to add investments to its tally. During the quarter, GV led a USD 10 million Series A funding round of Allara. The funds will be used to extend insurance coverage, launch partnerships with health systems, conduct clinical research, and scale Allara’s operations. GV also supported the launch of Layer Health, a healthcare AI company spun out of MIT, which was launched with a total of USD 4 million in funding. The company is to leverage AI to improve efficiencies in clinical, administrative, and research tasks.

• Amazon was the only other Big Tech to invest in the healthcare space during the quarter. Through the Alexa Fund, the company invested in Sunrise Health, a sleep technology provider. In total, the investment round raised USD 6 million, and the proceeds are aimed at expanding the company's geographical reach.

Retail

• CVS Health, the only retailer to pursue investments during the quarter, matched Big Techs’ number of investments. Through its venture capital arm, CVS Health Ventures, the company led a USD 40 million Series D extension round of Cortica. The additional funding is expected to bolster the nationwide expansion of Cortica's autism care model and investments in technology, data capture, research, and enhancement of the clinician and patient experience. CVS Health Ventures also participated in Abridge's USD 30 million Series B funding round, where the proceeds will be used to support large-scale health system rollouts and product development initiatives. In addition, the venture capital company also participated in funding rounds of Waymark and Amalgam Rx during the quarter, both of which aimed to scale up respective technological offerings.

Appendix

Large incumbents in primary care