Since the Covid-19 pandemic erupted in 2020, digital health transformation has touched all areas of healthcare, with MedTech leaders and health providers championing new technologies to improve patient care.

However, a new investment report by Rock Health indicates that in 2022 the investor bubble burst, with funding declining to $15.3 billion, a significant underperformance compared to 2021’s $29.3 billion. The negative funding trajectory has been attributed to investor caution due to uncertain global markets.

“For the digital health sector, 2022 was a downhill ride—one that we think signals the tail end of a macro funding cycle centered around the Covid-19-era investment boom,” wrote report authors Kyle Bryant, Madelyn Knowles, and Adriana Krasniansky.