May 2025 Healthcare Roundup: IPO Windows Open, Data Assets Get Scooped Up, and AI Funding Continues Its Hot Streak

May delivered what the digital health industry has been desperately waiting for—successful IPOs that actually work. Hinge Health's $437M NYSE debut and Omada Health's filing signal the end of the IPO drought, while Regeneron's $256M acquisition of bankrupt 23andMe shows how valuable genetic data has become to Big Pharma. Meanwhile, Pathos AI's $365M Series D proves investors are still writing massive checks for AI drug discovery platforms. These moves suggest we're entering a new phase where sustainable business models and proven outcomes matter more than hockey stick growth projections.

Digital Health IPOs Are Back: Hinge Health and Omada Lead the Charge

May 23 & May 12 - Hinge Health completed its IPO, raising $437.3 million on the NYSE under ticker HNGE, with shares jumping 17.4% on debut day to close at $37.56. Just over a week earlier, Omada Health filed for its own IPO on Nasdaq under "OMDA" marking the second major digital health IPO filing of 2025. Both companies represent the virtual chronic care management space—Hinge focusing on musculoskeletal conditions and Omada targeting diabetes prevention, weight health, and hypertension.

Why it matters: These IPOs represent a milestone moment for digital health after years of public market drought. Hinge's successful debut is particularly significant—it's the first major IPO for a venture-backed digital health company since the pandemic investment boom crashed back to earth. The company's path from a $6.2 billion private valuation in 2021 to a $2.9 billion public market debut tells the story of an entire industry that's had to grow up fast by actually generating sustainable profits and value.

What makes these companies different from the previous generation is their focus on sustainable unit economics and proven clinical outcomes. Hinge turned profitable in Q1 2025 with $17.1 million in net income after years of losses, while Omada boasts a 90% customer retention rate over three years and serves over 679,000 enrolled members across 2,000 customers. Both companies have seemingly moved beyond the "growth at all costs" mentality that defined the 2020-2021 era.

The real test isn't whether these stocks pop on day one—it's whether they can maintain momentum as public companies. With more than 50 digital health unicorns globally still sitting in private markets, the performance of Hinge and Omada will likely determine whether we’ll see an influx of new IPO filings or if companies will preserve their private status on the sidelines. As Torch Capital's Jonathan Keidan noted, "It's shown how the markets have forced companies to get lean, to get profitable and to maintain their traction."

Regeneron Scoops Up 23andMe's Genetic Goldmine in $256M Bankruptcy Win

May 20 - Regeneron Pharmaceuticals won the bankruptcy auction for 23andMe with a $256 million bid, beating out six other contenders including co-founder Anne Wojcicki's attempt to take the company private. The acquisition gives Regeneron access to 23andMe's biobank containing genetic data from more than 15 million customers—a massive expansion from Regeneron's existing database of 2.7 million sequenced exomes.

Why it matters: This deal perfectly represents how consumer genetics companies have become data mining operations for Big Pharma, even when their original business models fail to sustain their operations. While 23andMe became a household name for telling people their ancestry and health predispositions, its real value was always the genetic dataset it was quietly accumulating.

Regeneron isn't just bailing out a struggling consumer genetics company—it's acquiring one of the world's largest collections of human genetic data linked to health information. Regeneron’s Genetics Center (RGC) has already identified more than 30 novel genetic targets using its existing database, and adding 23andMe's much larger dataset could accelerate drug discovery efforts significantly.

The timing is particularly interesting given the broader trend toward personalized medicine and the use of genetic data in developing targeted therapies. While 23andMe struggled to monetize its consumer business model and failed attempts at pharmaceutical partnerships, Regeneron has the infrastructure and expertise to actually turn genetic insights into profitable drug development programs.

For consumers who spit in a tube years ago to learn about their heritage, this acquisition raises important questions about data ownership and privacy. Regeneron has committed to maintaining 23andMe's privacy policies, but the reality is that genetic data initially collected for consumer curiosity has now been transferred without individuals’ consent and has become solely pharmaceutical research fuel. It's a reminder to individuals that in today’s data economy, your data often has more value than initially apparent, and certainly more than initially marketed, especially when bankruptcy courts get involved.

Pathos AI Raises $365M as Cancer Drug Discovery Gets Another Massive Check

May 16 - Pathos AI secured $365 million in Series D funding, pushing its post-money valuation to approximately $1.6 billion and bringing total funding to around $467 million. The round follows just seven months after the company's $62 million Series C, demonstrating the expedited timelines and massive scale at which AI drug discovery platforms are attracting capital. The company appointed former AstraZeneca oncology R&D chief data scientist Iker Huerga as CEO earlier this month, adding pharmaceutical industry credibility to their leadership team.

Why it matters: Pathos AI represents the next wave of AI drug discovery companies that are moving beyond computational promises to actual clinical assets. Unlike earlier AI biotech startups that focused primarily on target identification or molecular design, Pathos has built what they call "the largest multimodal foundation model in oncology". Their PathOS platform integrates clinical, molecular, and imaging data to guide drug development decisions.

What makes this funding particularly notable is that Pathos isn't just raising money for research, the company is using AI insights to actively acquire and develop existing cancer drugs. The company has already put their platform to work, using it to guide the acquisition of two clinical-stage assets: pocenbrodib (licensed from Novo Nordisk) for metastatic castration-resistant prostate cancer, and P-500 (acquired from Prelude Therapeutics) for brain cancers with IDH mutations.

This "AI-guided asset acquisition" strategy could represent a shiny new model for how drug discovery platforms create value. Rather than starting from scratch with novel compounds, Pathos is flirting with a portfolio management approach - using their AI to identify undervalued or overlooked assets that might have better chances of success with the right patient populations and combination strategies. Their P-500 program has already shown promising results with two complete responses among 16 patients with IDH-mutated high-grade glioma.

The real test will be whether Pathos can deliver on their AI-guided approach—something we'll see as both clinical programs advance over the next 12-24 months.

Other stories that caught our eye this month:

• TELUS Health Acquires Workplace Options in $500M Strategic Expansion

• Medtronic to Separate Diabetes Business into New Standalone Company

• LifeMD Partners with Novo Nordisk to Offer $299 Wegovy Bundle for Self-Pay Patients

• World Health Assembly Extends Global Digital Health Strategy Through 2027