Women's health sees 'capital deployment' following Supreme Court ruling

·Anchor/Reporter
·3 min read

The Supreme Court decision to overturn Roe v Wade triggered a wave of outrage from pro-choice groups as states moved quickly to criminalize abortion.

Now, investors are taking action with their dollars, deploying capital to support women’s health startups.

“I've gotten so much inbound from investors, some of whom have been active in digital health, but perhaps not as much in women's health, that see capital deployment as a mechanism for action and see an opportunity where there are talented entrepreneurs that are stepping up,” Deena Shakir, partner at venture firm Lux Capital, said on Yahoo Finance Live (video above).

A long-time investor in women’s health, Shakir said her portfolio companies have seen elevated interest, as investors see huge business opportunities stemming from increased demand for reproductive care.

The Maven Clinic, for example, which advises companies on women’s health and family benefits, including fertility, has seen a month-over-month increase of 67% in inbound sales opportunities, since the court ruling, according to Shakir.

Taniya, an ultrasound sonographer, guides resident Dr. Ericka during an ultrasound on a patient before her surgical abortion at a clinic in Oklahoma City, December 6, 2021.  REUTERS/Evelyn Hockstein
Taniya, an ultrasound sonographer, guides resident Dr. Ericka during an ultrasound on a patient before her surgical abortion at a clinic in Oklahoma City, December 6, 2021. REUTERS/Evelyn Hockstein

“The second the Supreme Court decision was struck down, even our most conservative clients that previously didn’t want to take a position [on abortion] stood up and designed employee benefit packages through Maven and other services to support travel across state lines to support pregnancy options, counseling, and a lot of other things,” Maven Clinic CEO and Founder Kate Ryder said in a recent interview with Bloomberg.

The historic ruling is expected to spur growth in a fast-growing segment of health care that has long been overlooked and underfunded. While women make up half the global population and account for roughly $500 billion in annual medical expenses, just 1% of all health care research and innovation is exclusively committed to female specific issues beyond oncology, according to a McKinsey report.

That mismatch has contributed to a recent surge in investments, particularly as employers look to expand benefits related to maternal and family health services. Women’s health startups raised a record $1.98 billion from venture capital investors in 2021, according to data from Pitchbook. As of March 2022, nearly 40 venture-backed women’s health startups have raised more than $155 million.

The Maven Clinic, where Shakir serves on the board of directors, has seen the biggest inflows.

Deal values have been steadily rising for femtech VC activity. (Chart: PitchBook)
Deal values have been steadily rising for femtech VC activity. (Chart: PitchBook)

Last summer, it became the first health company exclusively focused on women’s issues to reach unicorn status, after securing $110 million in a series D funding round led by Shakir and backed by Oprah Winfrey.

“Human health is recession proof," Shakir said. "Unless there's a real apocalypse in the near future, we're not going anywhere anytime soon. We'll continue to get sick. We'll continue to have babies. We'll continue to have health care issues.”

The global women’s health market is expected to nearly quadruple in value by the end of 2030, generating roughly $3 billion, according to PitchBook.

With the Supreme Court’s decision refocusing efforts on addressing the gaps in care for maternal and fetal medicine, Shakir said the sector could see a greater tailwind to come.

“There's a long history of regulatory constraints compelling creativity and innovation emerging from these really difficult situations,” she said. “I have been so heartened to see the health tech companies, many of which we've invested in, rising to the occasion and stepping up to fill in where we have gaps right now from what the government is able to provide.”

Akiko Fujita is an anchor and reporter for Yahoo Finance. Follow her on Twitter @AkikoFujita

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