Mobile ultrasound startup Butterfly Network has become digital health’s most recently minted unicorn after raising a $250 million Series D round at a $1.25 billion valuation, according to a source with knowledge of the deal.
The financing round, which is being led by financial services company Fidelity and includes participation from big-name funders like Chinese pharma company Fosun Pharmaceutical, the Bill & Melinda Gates Foundation and billionaire hedge fund manager Jamie Dinan, is meant to boost the commercialization of the company’s personal ultrasound device.
“With their support, we can maximize the societal impact of ultrasound, changing the trajectory of healthcare around the globe,” wrote Butterfly Network President Gioel Molinari in a blog post announcing the financing.
With the Series D round, Butterfly Network’s total funding has increased to $350 million. The company, which is based in Guilford, Conn., has around 100 employees.
Butterfly Network received an FDA 510(k) clearance last year for its Butterfly iQ portable ultrasound imaging system, which is a diagnostic tool that is connected to a smartphone.
Butterfly Network’s technology, which it calls an “ultrasound-on-chip” is designed to perform diagnostic imaging and measurement of blood vessels and examine the cardiac, abdominal, urological, fetal, gynecological, and musculoskeletal systems.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
Instead of piezoelectric crystals, Butterfly iQ’s device uses semiconductor chips allowing for a lower sales price and more versatility than traditional alternatives.
The device retails for $2,000, with an additional monthly subscription fee for the associated software that ranges from $35 to $100. Compare that to traditional ultrasound machines which regularly cost between $15,000 and $100,000.
Butterfly iQ preorder units have started to ship out to thousands of customers around the world, according to the company.
By making ultrasound imaging easier and more accessible, the company is hoping to give physicians a clearer, real-time perspective into the body without some of the harmful risks and delays with radiation-based imaging technologies. Butterfly Network describes its device as part of a way to improve medical education and “arm the next generation of doctors”
Butterfly Network was founded in 2011 by Dr. Jonathan Rothberg, a serial entrepreneur in the medical technology industry who is known for his contributions to gene sequencing.
Rothberg started Butterfly Network after his daughter developed a rare disease called tuberos sclerosis that required constant imaging and he was struck at how inaccessible and expensive traditional ultrasounds were.
“Just as putting a camera on a semiconductor chip made photography accessible to anyone with a smartphone and putting a computer on a chip enabled the revolution in personal computing before that, Butterfly’s ultrasound-on-a-chip technology enables a low-cost window into the human body, making high-quality diagnostic imaging accessible to anyone,” Rothberg said in a statement.
Part of that effort is an attempt to distribute their portable device to developing countries or other areas without access to existing ultrasound technology. The worldwide reach of new company partners like the Gates Foundation is a boon to that effort.
Earlier this year, the company launched an augmented reality tool to support expert opinion consults via telemedicine, which would be particularly useful for rural care in developing countries.
“In developing countries, ultrasound can be used as a diagnostically superior and safer method than X-ray to diagnose critical global health issues like pediatric pneumonia. Our integrated software platform is paving the way for early detection and remote diagnosis of health issues around the world,” Molinari wrote in the blog post.
While Butterfly Network has the biggest war chest in the space, it isn’t the only group trying to develop portable ultrasound technology to take advantage of the $6 billion global ultrasound market.
Canadian company Clarius Mobile Health has developed similar technology, as well as Korean company Healcerion and Redmond, Washington-based Mobisante, albeit at higher costs than the Butterfly iQ.
Source: Butterfly Network
