Digital health firm Omada prices $150m IPO

In another sign of recovery in digital health investing, Omada Health has priced an initial public offering (IPO) of $19 per share, looking for $150 million in proceeds and a valuation upwards of $1.1 billion.

The specialist in delivering virtual treatment and support between doctor visits for people with chronic conditions like prediabetes, diabetes, musculoskeletal (MSK) conditions, and high blood pressure said that the offer is expected to close on Monday, with its shares trading on the Nasdaq under the OMDA ticker.

The IPO comes just a few weeks after Hinge Health, a company which provides digital health technology (DHT) for managing MSK conditions like back and joint pain and post-surgical rehabilitation, raised $437 million in its IPO. That ended a long hiatus in public listings for digital health companies.

Omada started operating in 2012, providing DHTs for diabetes prevention and weight control through private health plans a similar business model to Hinge – and has steadily increased its offering to cover additional areas, including support for people taking GLP-1 agonists to lose weight. As of the end of March, the company had more than 2,000 commercial customers and 679,000 people actively enrolled in one or more of its programmes.

Many digital health companies that took the plunge and went public after the pandemic saw their share prices decimated last year as investors lost faith in the sector, mainly due to uncertain reimbursement pathways and high customer acquisition costs.

Omada seems to have shown more resilience. In its IPO prospectus, the company said its first-quarter 2025 revenues rose 57% to $55 million, revealing further momentum on its 2024 growth of 38% to $170 million. Part of that increase comes on the back of an alliance announced last year with Amazon to promote its DHTs to Amazon Prime members.

It said it is planning to use the proceeds of the IPO for paying off debt, working expenditures, and capital projects that could include the acquisition of "complementary businesses, products, services, or technologies."

The company puts its success down to its focus on helping people with chronic health conditions make the behavioural changes needed to make sure that treatments delivered through conventional healthcare channels are effective.

"Between what can be short and infrequent office visits, patients are often left to manage their condition on their own," according to Omada's IPO prospectus.

"Many have a hard time sticking to care plans and health goals – losing weight, eating better, exercising more – and have few resources to turn to for ongoing questions, accountability, and support as they work to change their lifestyle."

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