MedCity Influencers, Health Tech

Women’s health needs have been overlooked. Can “FemTech” fill the gap?

Funding in FemTech startups has risen from next to nothing in 2008, to almost $2.5 billion in 2021; deals have seen the same trend, from a handful to almost 300 over the same period.

Pain in the left arm and a painful squeezing sensation in the chest: Is a heart attack on the way? Quite possibly, for men. For women, though, common heart attack indicators are more similar to heartburn. That may be one reason why women are 50 percent more likely than men to be misdiagnosed following a heart attack, and also more likely to die from one.

Women may hold up half the sky, as the Chinese proverb goes, but when it comes to medical research and funding, they don’t get half the attention. Rather, male physiology has long been the default option.

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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.

Women have been underrepresented in clinical trials, and their specific characteristics have been overlooked in the development of medical devices. Hip implants, for example, were designed with men’s musculature in mind, and have much higher failure rates for women. When women report pain, they are less likely to be treated for it, with their symptoms too often dismissed as “emotional” or “psychosomatic.” Women metabolize some drugs more slowly; that affects recommended dosages, something that has not always been recognized, and has contributed to them experiencing adverse events from drugs twice as often as men. Other than cancer, female conditions comprise less than 2 percent of the healthcare research and innovation pipeline.

With hindsight, no doubt medical professionals would have done things differently, so that there would be fewer and smaller such disparities. But they exist. And while that is unfortunate, it also means that there are big opportunities—to improve women’s health and strengthen the healthcare system, while opening up new sources of growth. Consider menopause: women spend more than a third of their lives in peri- or post-menopause and an estimated one in four women has serious symptoms—and this is at the time when many are stepping into senior roles.  The dearth of effective solutions for these symptoms can impact the quality of women’s experiences at work and further amplifies the demand for more innovation in this space.

One more reason to think that realizing such opportunities—medical, financial, and societal—is not only possible but even likely is the rise of “FemTech.” This term refers to the development of tech-enabled, consumer-centric solutions that specifically address women’s health (except for biopharma and incumbent medical devices). By “women’s health,” we mean female-specific issues, such as contraception, fertility, maternal health, gynecology, and related cancers. In addition, we include general health conditions, such as heart disease, that affect women differently or worse; examples of the latter are autoimmune disease, migraines, and osteoporosis.

McKinsey recently analyzed 763 FemTech companies—and found that the sector is surging, albeit from a low base. Funding in FemTech startups has risen from next to nothing in 2008, to almost $2.5 billion in 2021; deals have seen the same trend, from a handful to almost 300 over the same period.

And it is not just potential: there is demonstrated success in the marketplace. Progyny, which manages fertility benefits for employers, went public in 2019 at a valuation of a little over $1 billion; now it is worth almost four times that. Maven Clinic, a virtual clinic for women’s and family health, was valued at more than $1 billion in a recent Series D investment. FemTech may be finding a niche in intimate areas, such as menstrual health, sexual health, pelvic care, and menopause, and in serving specific customer segments, such as Black women and LGBTQ+ populations. Finally, clinical diagnostics companies are pushing the scientific frontier to address unmet medical needs in areas such as endometriosis and preterm birth.

As a percentage of the health sector, FemTech is barely a rounding error—but that is why it could be such a big opportunity. For example, FemTech companies get only about 3 percent of digital health funding. But the number of areas in which FemTech is getting involved is growing and early movers are expanding their offerings. Put it all together, this is what change looks like—talent, capabilities, technology, money, and the market all moving in the same direction. Experience shows that rapid growth can follow when technologies converge to meet customer needs in radically new ways: think of the emergence of ridesharing, in which IT and smartphone technology combined with existing infrastructures to create a whole new sector.

We expect that as the most promising FemTech companies gain traction, outside investors, from both within and outside the health-care industry, will provide additional momentum. And this could help diversify the entire healthcare ecosystem: given the extent to which women’s health needs have been overlooked, it is not implausible that FemTech could draw in more female researchers, investors, and executives. It’s worth noting that more than 70 percent of FemTech companies in our analysis had at least one female founder, compared with a 20 percent norm for new companies.

That matters—and not just for women.  Women don’t just take care of their own health but are typically the primary healthcare decision-makers for their families. Better health outcomes for women, then, can help make for better, fairer societies as well.

Photo: ]metamorworks, Getty Images

Lucy Pérez is a senior partner in McKinsey & Company’s Boston office. A former cancer researcher, Lucy brings a strong technical background to her work with organizations across the life-sciences sector. Since joining McKinsey, she has partnered with CEOs and top teams at leading organizations across North America, Europe, and Asia. She leads evidence-generation work within the Life Sciences Practice, helping clients generate and apply research insights, clinical data, and real-world evidence to maximize patient benefit, demonstrate product value, and catalyze innovation. In addition to her client service, Lucy coleads the North America Hispanic Latino Network, a platform for consultants and Hispanic and Latino leaders to connect and build community as well as advance their professional development. Before joining McKinsey, Lucy was a research fellow at Memorial Sloan Kettering Cancer Center. She was also a Howard Hughes Medical Institute research fellow at Harvard University while completing her doctoral studies.

Shubham Singhal is a senior partner in Detroit. Shubham leads McKinsey’s healthcare, public sector and social sector work globally. He serves leading healthcare and social institutions and governments on all top-management agenda issues. His primary areas of focus include strategy, growth, M&A, business building, and large-scale digital and performance transformations. In healthcare, he has extensively served publicly traded and not-for-profit payers as well as public payers for more than 20 years. He also serves providers as well as healthcare technology and pharmacy companies. Shubham also leads the firm’s thinking and research on the future of healthcare in the wake of rapid advancements in digital, advanced analytics, and medical technologies; emergence of new treatments; healthcare reform and regulatory change; the rise of the healthcare consumer; and risk disaggregation and reallocation across the healthcare system.

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