France- based Sanofi and DarioHealth have signed a five-year deal amounting to $30 million.
The strategic agreement has a term of five years with distinct funding phases. The $30 million will be paid to DarioHealth divided across the 5 years, with $8M being released in year 1, $7M in year 2, as well as year 3, and the remaining amount will be spread across years 4 and 5.
Dario’s strategic alliance with drugmaker Sanofi will allow for Sanofi’s product integration onto the digital health company’s platform. Dario will also be able to market Sanofi’s current drugs.
The digital health company DarioHealth retains a market cap of $138M, however, the company was conducting business with a net loss since it became operational. After the deal was made public, Dario’s stock showed an increase of almost 14%.
Currently, Sanofi is also developing a mental health care app for sclerosis patients with Happify Health.
DarioHealth began its business in 2011 with an app for patients of diabetes and a glucometer connected to smartphones. Since then, the company has made an expansion to include acquisitions of devices for a wide range of medical needs to be worked on at home, such as cognitive behavioral therapy, physical therapy, and even posture correction.
The company is looking to shift from its consumer model to a B2B model, which the Sanofi agreement will help support through its sales team.
The combined effort’s aim is to gain B2B business through the sale of health plans of companies. Through the Sanofi & DarioHealth strategic alliance the companies aim to reach patients through an all-inclusive platform for chronic conditions.
A company representative explained that during these five years the two partners hope to reach some sales targets as well as gain enrollment overall. The Sanofi representative further added that they are eager to continue innovating with DarioHealth and help more and more patients with chronic conditions through the use of digital health technology.
The agreement leaves the option for Sanofi to invest in DarioHealth later in 2022. The financials of the partnership are not yet fully made public, however, analysts predict that they will positively impact the prospects of Dario as Sanofi is a heavyweight pharmaceutical company with a global presence.
Sanofi has also been busy creating partnerships as it had done
so with Verily in 2019 to create an online diabetes care platform and a virtual
insulin treatment solution with Voluntis in 2020. However, both partnerships have since ended.