Troubled Mfine merges with Lifecell International, raises $80 million

Healthcare startup Mfine will merge with the diagnostics arm of genetic testing services provider Lifecell International, in what is being considered a distress deal.

ET reported on May 23 that the startup had laid off around 500 employees, or about half of its workforce. Mfine is among the many startups that have struggled to raise funds after a record year in 2021.

The merged entity, called LifeWell, has raised $80 million from New York-based OrbiMed, a healthcare investment firm with approximately $18 billion in assets under management. OrbiMed also invested in PharmEasy in October last year as part of a $350 million funding round.

Mfine will be the digital arm of Lifewell, which will build a nationwide lab network.

Mfine will remain the app and consumer brand for digital healthcare services like tele-consultations, care plans, diagnostic tests, IP concierge, e-pharmacy and corporate subscriptions.

The fresh capital will be used for strategic investments in insurance-tech and other partners, the company said.

“We created a technology platform and high-quality provider network that pretty much set the standards of care experience in digital health in India,” said Prasad Kompalli and Ashutosh Lawania, cofounders of MFine. “With this joint venture, we see immense possibilities of delivering on-demand healthcare with outstanding consumer experience.”

Mfine was founded in December 2017 by former Myntra executives Lawania and Kompalli, who were later joined by Ajit Narayanan and Arjun Choudhary.

The company last raised $48 million in September 2021, co-led by Moore Strategic Ventures and Beenext, with participation from other investors such as Stellaris Venture Partners, SBI Group Japan, SBI Ven Capital Singapore, among others.

“As a seed investor in MFine, I've known Ashutosh & Prasad for a long time and have witnessed the development and growth of MFine as one of the leading digital health platforms,” said Mayur Abhaya, managing director and chief executive of LifeCell International . “Overall healthcare delivery is transforming worldwide with the rapid adoption of new technologies such as genomics and digital health. This combination paves the way to create a new market leader that meets the emerging customer expectations.”

Mfine’s digital services include doctor consultations, diagnostic tests, e-pharmacy and in-patient procedures. The company competes with the likes of Practo, Portea and Apollo.

Last year, Mfine launched an app based SPO2 (blood oxygen saturation) monitoring tool to enable users to keep track of their oxygen saturation levels without an additional device. This year, the company added tools that help check blood pressure and glucose levels on the app.