5 min read

Digital Health Startups Take Aim at Addiction

Just when we thought things couldn’t possibly get worse, a second pandemic is set to overwhelm the nation as a result of COVID-19.

What’s happening: A new study estimates that another 75,000 people could die “deaths of despair” from suicide or substance abuse related to the coronavirus pandemic.

Why it matters: Long before COVID hit, America’s mental health and addiction services were overburdened and underfunded. As more pressure is being applied to a broken system, the fallout could trigger a crisis of its own.

The big picture: COVID aside, the US has struggled to combat suicide rates and drug overdoses. In response, a growing number of health and wellness startups have taken aim at ending addiction. From new digital solutions to experimental therapies and reimagining recovery, disrupting the status quo has become central to breaking the cycle.

Warning Signs

Experts see coronavirus as a “perfect storm”, the combined effects of a pandemic, unemployment, and social isolation, that could drive substance abuse rates higher than ever before.

  • Nearly half of Americans say the coronavirus crisis is harming their mental health.
  • April saw a 1000% increase in people reaching out to the National Institute of Mental Health’s emotional distress hotline.
  • US “life satisfaction” reached a low point not seen since the Great Recession in November 2008.

Further complicating matters, alcohol and prescription medication were in high demand during the lockdown.

Alcohol. With liquor stores deemed essential businesses, alcohol sales at US retailers shot up 55% in the days following the national emergency declaration. More recently, the increase subsided but was still up 27%. Outpacing retail, online alcohol sales in the US increased by 477%.

Prescriptions. Anti-anxiety medications and sleep aids are being prescribed in record numbers. In March 2020, prescriptions for anti-anxiety medications jumped 10.2% to 9.7M in the US. Similarly, prescriptions for antidepressants, including Prozac and Lexapro, rose 9.2% to 29.7M. And Zoloft prescriptions climbed 12% YoY to 4.9M, the most ever in the US, creating a supply shortage.

According to post-disaster research, substance abuse generally increases following major traumatic events. In the case of COVID-19, mass unemployment and the loss of health benefits could lead people to self-medicate with opioids, alcohol, and prescription medications — exacerbating the underlying problem.

The Underlying Problem

Addiction treatment in the US is critically important but deeply flawed.

  • More than 20M Americans suffer a substance abuse disorder related to drug and alcohol use.
  • In the US, more than 750,000 people have died since 1999 from a drug overdose.
  • The abuse of tobacco, alcohol, and illicit drugs costs the US economy $740B annually.

Despite the fact that drug overdoses kill tens of thousands of Americans every year, treatment is often inaccessible. Among those who are treated, most do not receive evidence-based care. And lacking empirically supported treatment, 40–60% of people recovering from drug addiction will relapse.

While care providers, insurers, and federal regulators must reform a broken system, a growing list of startups aren’t waiting for a solution — they’re trying to create one.

Ending Addiction

Like mental healthsenior care, and fertility services before it, ending addiction has become the aim of tech companies and wellness upstarts alike. Now, new methods are being developed to destigmatize treatment and increase access to care.

According to Rock Health, digital solutions for addiction are on the rise. While strategies vary, treatments tend to include elements of pharmacotherapy, psychotherapy, contingency management, and social support.

At a time when telemedicine and online pharmacies gain wider adoption, addiction solutions are leveraging the same technology. Approaching the problem from a different perspective, social networks and smartphone apps targeting substance abuse are attempting to normalize rehab and recovery.

A number of recent funding rounds and product launches speak to the momentum behind this category.

Alcohol. From Dry January to the rise of alcohol alternatives, not drinking is the new cool — especially among younger generations and high-performers. Seizing this moment, startups focused on sobriety are springing up.

With $14M in funding, Tempest is reinventing alcohol recovery. Related, Loosid is a “sober social network” offering community support, dating, and more. Earlier this year, Big Sky Health unveiled Less, an app that helps users track alcohol consumption. More recently, and armed with $7.5M in funding, Monument launched a digital treatment platform for users looking to change their relationship with alcohol.

Tobacco. Nicotine addiction, vaping, and the effects of smoking continue to make headlines, especially given COVID’s impact on the respiratory system. Because smoking costs the US $300B and 500K lives each year, curbing this addiction has become a big business.

To date, Carrot has raised $30M to help millions of people quit smoking. Lucy, a direct-to-consumer company selling nicotine gum and lozenges, raised a $10M Series A in February. And Quit Genius, a company focused on smoking and vaping cessation, recently secured $11M to expand into alcohol and opioid addiction.

Opioids. 2018 data shows that every day, 128 people in the US die after overdosing on opioids. From prescription pain relievers to heroin and synthetic opioids such as fentanyl, opioid addiction impacts public health as well as social and economic welfare.

Boulder, a digital treatment platform for opioid addiction, has raised $10M to address these issues. Earlier in 2020, Ophelia, an online platform offering medication and support for quitting opioids secured $2.7M in funding. More recently, axialHealthcare, a platform for opioid medication solutions, closed $15M in Series C to reduce opioid dependence and addiction.


Far from a panacea, digital solutions for treating addiction are still nascent. And it’s impossible to fully address the addiction epidemic without also confronting the broader mental health crisis. But, as we’ve seen during COVID, the use of technology in primary care, for mental health screenings, and prescribing medication remotely has the potential to transform healthcare as we know it. Looking ahead, the hope is that this same kind of innovation will play a pivotal role in ending addiction.

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