The Sun Life Financial logo is seen at their corporate headquarters of One York Street in Toronto, Ontario, Canada, February 11, 2019. REUTERS/Chris HelgrenCHRIS HELGREN/Reuters
Sun Life Financial Inc. continues to boost its digital footprint in the health care sector, taking a minority stake in telemedicine startup Dialogue as part of a $43-million injection from a group of investors.
Canada’s second-largest insurer announced on Wednesday that it has entered into a partnership agreement with Montreal-based Dialogue that includes a $32.7-million equity investment and the right to acquire additional equity. The two companies are not disclosing what percentage of Dialogue that Sun Life will own.
Dialogue provides “doctor-on-demand” services that can answer health questions using chatbots or allow patients to speak online with medical professionals, primarily as extra features in employer health care plans. Founded in 2016, the online company has seen a spike in users with close to five million Canadians now with direct access to its service, up from 400,000 before the COVID-19 pandemic hit in early March.
Sun Life’s growth in digital health care follows a surge in demand from Canadians looking to talk to doctors online rather than in person since physical-distancing rules have affected face-to-face interactions. Earlier this year, government-run services, such as Telehealth Ontario, experienced outages and delays as Canadians overwhelmed phone lines and web services with concerns surrounding the virus.
The need to physically distance during the pandemic has put a spotlight on the importance of expanding the traditional health care model, fast-tracking the digital adoption of virtual health care by “three to five years,” Dialogue chief executive Cherif Habib said.
“Six months to a year ago, you had a group of health care physicians who were looking to try something new with online services but now that niche has turned mainstream,” Mr. Habib said in an interview. “Doctors are now forced to find alternative ways of running their practice.”
Since 2016, Dialogue has raised more than $100-million in four separate investment rounds. In addition to Sun Life’s equity announcement on Wednesday, the investment in Dialogue also includes an additional $10.3-million from the startup’s other backers: Caisse de dépôt et placement du Québec; Power Financial’s Portag3 Ventures; White Star Capital; HV Holtzbrinck Ventures; First Ascent Ventures; and Walter Ventures.
The new funding will allow Dialogue to make future acquisitions in both the technology sector and with health care providers. The company is also looking to expand its service offering to include virtual health care treatments for chronic diseases and to provide women’s health care services.
Last March – in response to the COVID-19 outbreak – Sun Life added free virtual health care services for its group-benefits clients through a partnership with Dialogue. The arrangement allows Sun Life clients to access a virtual clinic and connect directly with a health care professional.
“Before the pandemic, we were already focused on expanding digital health care, but that landscape has rapidly accelerated during COVID as Canadians look for other ways to access health care when they need it most,” Marie-Chantal Côté, vice-president of market development for Group Benefits at Sun Life, said in an interview.
In addition to its March partnership with Sun Life, Dialogue also partnered with the group-benefits divisions of several major Canadian insurers including Canada Life, La Capitale Insurance, SSQ Insurance and Industrial Alliance.
Currently, Mr. Habib said mental health is one of the top services Canadians are turning to online services for assistance.
Nearly 60 per cent of Canadians have reported that the COVID-19 pandemic has negatively affected their mental health, according to a Sun Life survey conducted last month.
“Despite identifying a physical or mental-health concern, only a small percentage of Canadians are seeking treatment,” Ms. Côté said.
“The need for Canadians to connect virtually with health care professionals has never been more important.”
Sun Life first invested in digital health care in 2018 with the launch of Lumino Health, a website and mobile app that connects Canadians to more than 150,000 health care providers – such as dentists, massage therapists, chiropractors and psychologists.
Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.