A startup that's working to pair patients who have unique medical needs with specialty pharmacies via a proprietary platform announced the close of a $20 million funding round to continue those efforts and grow its workforce.
Free Market Health, based in the Strip District, said the raising of this Series B funding round will help grow its workforce count by at least 50% over the next year. The startup currently employs 53 people, 31 of whom are based in the Pittsburgh area.
With the close of the funding round, Free Market Health's overall outside investment deals now total $35.5 million.
The company started raising this round toward the end of Q1 and amid market conditions that have been unfavorable to startups in need of outside investments to fuel growth and product development. Free Market Health said it then formally closed on the funding in late Q2.
Questa Capital, a health care-focused venture capital firm based in Washington, D.C., with offices in San Francisco, led the round. Previous investors in Free Market Health, including Alta Partners, Highmark Ventures and 653 Investment Partners, also participated in the startup's Series B.
"For a leading firm like Questa Capital to pick Free Market Health as the initial investment from their new health care venture fund, and for each of our existing investor partners to reinvest, the raise feels like validation of our model, the team we’ve attracted, our ability to execute, and our mission," Free Market Health Founder and CEO Joe Cardosi said in an email statement to Pittsburgh Inno. "This raise not only delivers a great new partner in Questa, but it provides the resources to accelerate our execution of the goal, which is all about creating value for payers, pharmacies, and most importantly, patients."
Much of the work regarding Free Market Health's tech platform has been completed. Minor work is needed only for the scaling of the platform to cater to the needs of larger enterprise clients.
"At this stage, the bulk of the investment will be in our people," Lori Kelly, vice president of marketing at Free Market Health, said in an email statement. "We have significant big deals to execute and implement in front of us from both payers and channel partners, and we’re focused on expanding our growth organization with the right team members to help execute."
The funding news for Free Market Health comes amid a flurry of positive investment deal developments for local tech firms over the past week, which have been lacking in frequency and in total dollar amounts raised for the better part of a year.
On Oct. 31, biotech startup Imagine Pharma closed on a $32.5 million Series A funding round, which followed an announcement days earlier that Abridge AI Inc. closed on its $30 million Series B funding round. And on Oct. 26, it was reported that LyGenesis Inc. closed on its Series A-2 funding round.
Meanwhile, funding deal flow for Pittsburgh-area tech firms has seen a quarter-to-quarter decrease over the past three months ended Sept. 30, which comes six months after the worst quarter for such activity in at least a decade, according to an analysis of data from the PitchBook-National Venture Capital Association Venture Monitor. A little over a dozen local tech companies reported to receive at least $43.85 million in funding during Q3. That's down from the estimated $77 million that about two dozen local firms raised in Q2.
