Aradigm Health, a new benefits platform aimed at easing the financial sting of coverage for cell and gene therapies, has launched out of stealth.
The company is making its debut backed by a $20 million series A funding round that it intends to use to further enhance platform development, building out its team and growing its partnerships with payers and providers. The round was led by Frist Cressey Ventures with backing from Andreessen Horowitz and Morgan Health.
Andreessen Horowitz led the company's $5 million seed round in 2024 as well, according to an announcement.
Will Shrank, CEO of Aradigm, told Fierce Healthcare that as science rapidly evolves, treatments like cell and gene therapies that can completely change the lives of patients will continue to come to market. However, these products tend to carry hefty price tags that can be difficult for plans and plan sponsors to absorb.
He said there wasn't a clear silver bullet to fix this issue, which opened the door for a company like Aradigm to change the model.
"These therapies can be incredible for patients," he said. "They're unbelievably expensive, and our fragmented healthcare system is now well positioned to be able to deliver them consistently, affordably, sustainably, to patients who can benefit. So it seemed like this is really the moment to jump in."
Aradigm leaned on feedback from 15 jumbo employers and six health plans as it built out its model. For self-insured employers and insurers, the platform pools and caps risk to address affordability, and it operates on a transparent, cost-plus model, unlike more traditional stop-loss coverage that employers tend to lean on for high-cost claims.
The program connects patients with personalized care coordination services that can make it easier for them to navigate the system and uses upfront, predictable models that make it easier for providers to offer these therapies when appropriate.
Shrank said it was rewarding to see the companies that contributed feedback to building out Aradigm's platform really show they're ready to "roll up their sleeves" on this issue.
"There was a clear sense this is not a place where the market really wants to compete," he said. "There's a place where, through collective action, there's an opportunity for us all to join forces and try to solve this problem together."
Morgan Health, the healthcare arm of banking giant JPMorgan Chase, has put a focus on investing in companies that can address the major challenges facing employers, particularly around cost and quality. Shrank said the organization's participation in support of Aradigm is a sign it wants to get out ahead on this issue.
“Cell and gene therapies represent a new frontier in medical treatment, but also pose an existential cost challenge for American healthcare. Businesses want to make sure their employees are covered at a reasonable cost,” said Dan Mendelson, CEO of Morgan Health, in the announcement.
“Aradigm addresses these challenges by ensuring that innovative therapies are being administered effectively and efficiently — and by helping make insurance for these low-volume products work better for American employers," Mendelson said.