An alarming number of digital health companies have dismissed employees in 2022, and 2023 didn’t start better. With big techs like Google’s parent company Alphabet, Microsoft, Amazon, Meta, etc., laying off more than 10,000 employees in an attempt to recalibrate after the rapid growth post-pandemic, we can expect a similar situation in the digital health sector.
Digital health companies are facing strong macroeconomic headwinds, leading to several layoffs in the industry. More than 40 health tech startups and companies announced layoffs in 2022, affecting thousands of employees.
Most digital healthcare companies have been struggling with the ongoing economic trend and financial issues and are forced to lay off employees as they look to realign their strategic priorities. Some companies are also looking to streamline operations and focus on their core business to achieve significant cost reductions.
While the investments had poured in 2020 and 2021, they cooled down during 2022, resulting in several investor-backed startups realigning their strategic priorities and cutting down products and services that do not match. This resulted in significant layoffs across the industry.
Recent announcements of layoffs in healthcare
- Teladoc Health, a virtual care company, is laying off 300 employees, 6% of its workforce, as part of its larger restructuring plan to reduce operational costs.
- Verily, the life sciences subsidiary of Alphabet is laying off around 15% of its employees amid strategic restructuring due to the ongoing pandemic and its impact on the company’s business.
- Innovaccer, an Indian health-tech startup and unicorn, is laying off 245 employees or 15% of its staff to streamline its organisational focus. This is the second layoff within six months for Innovacer, which had laid 90 employees in September.
- MediBuddy, an end-to-end Indian digital healthcare platform, dismissed 8% of its workforce, around 200 employees, as a part of organisational restructuring.
- Finch Therapeutics, a biotech company, is laying off 95% of its staff, citing frosty funding forecasts and slow enrollment of trials.
- Cyteir Therapeutics, a biotech company, is laying off 70% of its employees as it realigns its primary focus areas.
- Elevation Oncology dismissed 30% of its staff as it paused the development of solid tumour therapy.
Indian health tech companies that cut down on employees
Indian health-tech startups have also been hit hard by the economic downturn, resulting in layoffs across the industry.
- HealthifyMe, a Bengaluru-based health-tech startup, has laid off 150 employees, 15-20% of its total workforce. The decision was made due to growth not keeping pace with expectations and an evolution towards their new vision of metabolic health requiring different resources.
- MFine, another Indian healthcare startup, laid off 75% of its staff, over 500 employees, due to running out of money to pay salaries.
- Breathe Well-being, a Gurugram-based health-tech startup, laid off around 50 employees, or 30% of its workforce, due to its inability to secure new funding and running into losses.
- PharmEasy, an e-pharmacy unicorn, has undergone another round of layoffs amid a funding crunch, not disclosing the number of employees affected. Earlier, it laid off around 40 full-time employees at its electronic medical record subsidiary Docon Technologies.
Other digital health companies that announced layoffs in 2022
- Akili Interactive, a digital therapeutic startup, announced a layoff of 30% of its staff to increase focus on its core capabilities.
- Definitive Healthcare, a healthcare analytics and insights company, laid off 55 people, 6% of its workforce, citing economic uncertainty as the reason.
- Carbon Health, which combines traditional brick-and-mortar clinics with telehealth, trimmed its employee base by 8% or approximately 200 employees, citing the need to streamline operations and improve efficiency.
- Cue Health, a virtual testing company, laid off around 26% of its employees, citing economic uncertainty and reduced funding for COVID-19 testing as the reason.
- Heal, a virtual on-call doctor service, laid off more than 240 employees in California and New York due to the current economic conditions and its impact on the company’s business.
- SonderMind, a digital behavioural health platform, laid off 15% of its staff only a month after acquiring Total Brain, citing the need to streamline operations and improve efficiency.
- Headspace Health, a mental health unicorn, laid off 50 employees, 4% of its headcount, citing the need to realign strategic priorities.
- Komodo Health, a healthcare data and technology company, laid off 78 employees, citing economic uncertainty.
- Reify Health, a clinical trial technology company, laid off 160 employees from its portfolio company OneStudyTeam, citing the need to streamline operations after a period of rapid growth and hiring.
- Elemy, a start-up company that services children with autism, confirmed it conducted additional layoffs, citing the need to align its positions with its software-as-a-service model.
- Medly, a Brooklyn-based digital pharmacy startup, laid off half its workforce as the company was looking to realign its strategic priorities. Later, it laid the remaining 173 employees as the company filed for Chapter 11 bankruptcy protection.
- GoodRx, a consumer drug pricing and digital health company, is laying off 140 employees, 16% of its workforce, primarily in its technology and marketing groups, as the company is looking to realign its strategic priorities.
- ThirtyMadison, a direct-to-consumer pharma telehealth company, reduced its corporate staff by 10% as the company is looking to realign its strategic priorities.
- Wheel, a telehealth company, laid off 17% of its team, 35 employees, as the company focuses on investing in its technology and building an enterprise platform.
- Signify Health is laying off nearly 500 employees as the company realigns its strategic priorities.
- Mental health unicorn, Calm, has cut 20% of its workforce as the company is looking to realign its strategic priorities.
- Sema4, an AI-driven genomics and clinical data intelligence company, in an attempt to realign its strategic priorities, took an exit from the reproductive and women’s health testing business, resulting in the elimination of about 500 jobs. It also eliminated its somatic tumour testing business, laying off another 250 employees.
- Mindbody is undergoing a layoff as the company is looking to realign its strategic priorities.
- Brightline, a paediatric mental health startup, laid off 20% of its employees, citing realignment of strategic priorities.
- Advata, a health data analytics company in Seattle, laid off 32 employees as the company is looking to streamline operations.
- Cerebral, the embattled online mental health startup, is cutting approximately 20% of its staff as the company realigns its strategic priorities and restructures its operations.
- Antidote Health, a telehealth company, is cutting one-third of its workforce to streamline operations.
- Noom, a digital weight loss company, is laying off employees as it undergoes a business transition and realigns its strategic priorities.
- Redesign Health, a startup creator, has laid off 67 employees (20% of the workforce) as part of a strategic evolution rather than a financial decision.
- TruePill, a digital pharmacy startup, conducted four layoffs in 2022, affecting approximately 40% of its employees. The company focuses on its core pharmacy business and aims to achieve significant cost reductions.
- Robin Healthcare, a medical scribe technology company, laid off an undisclosed number of employees as it realigns its strategic priorities.
- Curative Health, a COVID-19-based testing startup, is laying off 109 employees as it is looking to realign its strategic priorities.
- Amazon laid off nearly 400 workers as it closed Amazon Care.
- GoHealth, a health insurance brokerage, has laid off 20% of its workforce, which equates to 800 agents and support workers, as the company is looking to realign its strategic priorities.
- Capsule, an app-based pharmacy startup, initiated layoffs affecting 13% of the company’s workforce as it realigns its strategic priorities.
- Invitae, a genetic testing company, dismisses more than 1,000 employees as it is restructuring its operations and focusing on business lines that deliver sustainable margins and returns.
- Olive, the Columbus, Ohio-based healthcare AI company, said it was laying off around 450 employees, 35% of its workforce.
- Calibrate Health, a digital health company focused on weight loss, laid off 24% of its employees as the company is looking to streamline operations and achieve cost reductions.
- Forward, a San Francisco-based primary care startup, laid off 5% of its workforce, citing market conditions as the reason for the reduction.
- Cedar, a New York City-based medical payments technology company, said it was letting go 24% of its workforce as the company is looking to restructure its priorities.
- Ro, a direct-to-consumer telehealth company based in New York City, laid off 18% of its 750-employee workforce, citing the economic downturn as the primary reason.
- Sidecar Health, an insurtech unicorn, laid off 40% of its workforce as it is looking to realign its strategic priorities.
