CVS Health is creating a new corporate venture fund. Called CVS Health Ventures, it will launch with $100 million.
To start, the fund will focus on investing in early-stage startups that could benefit from a strategic relationship with CVS, including its thousands of stores, and customers of Aetna and Caremark. CVS’ leadership also emphasized consumer-facing innovations in a press release issued Thursday.
“Consumers deserve a better health experience, one that puts them at the center of cutting-edge, digitally enabled solutions,” CVS President and CEO Karen Lynch said in a news release. “Forming CVS Health Ventures will build on our successful track record of scaling innovation and driving change in health care.”
The new fund will be led by Joshua Flum, CVS’ executive vice president of enterprise strategy and business development.
“We have deep experience investing in innovative companies,” he said. “We will build on this experience by providing capital to our start-up and venture partners and helping them scale more rapidly through commercial relationships with our business units.”
Some examples of past investments include Unite Us, a startup focused on social determinants of health screenings, and point-of-care diagnostics startup LumiraDx. In total, CVS and Aetna have made direct investments in more than 20 startups.
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.
Corporate venture funds play a particularly big role in healthcare investing. Last year, some of the top health-tech investors by the number of deals included BlueCross BlueShield, Optum Ventures and Alphabet, according to a report by Silicon Valley Bank.
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