Nudj Health Gets $10M Financing Boost for Partnerships with Physician Groups to Change Patient Behavior – Los Angeles Business Journal

With progress stymied on reducing chronic diseases and conditions such as diabetes, obesity, high blood pressure and heart disease through prescription drugs, the health care sector is increasingly turning to techniques incorporating data algorithms and lifestyle coaches to improve patient behaviors.
The latest local entrant in this burgeoning field is Pasadena-based Nudj Health Inc., which in April raised $10 million in seed financing to boost its efforts to partner with physician groups to track and change patient lifestyle behaviors.
“About 80% of all chronic conditions and diseases can be prevented, reduced or even reversed through lifestyle changes,” Nudj Health founder and Chief Executive Yuri Sudhakar said. “But up until now, physicians routinely gave patients instructions on taking medications and getting more exercise, but they have very little sense of what really goes on with patients once those patients leave their offices.”
As a result, improvements in patient lifestyle decisions often don’t stick over the long term.
“That’s where we come in,” Sudhakar said. “We bring a ‘care extension team’ that continues the care after the patient leaves the doctor’s office. We work on the daily exercise routines, the meal choices, the proper taking of medications with the patients.”
With this continuing patient reinforcement, he said, “satisfaction is higher. The patients know they have a plan and people on their care team helping them carry out that plan.”
Nudj Health uses the latest technology for reporting and tracking to make this happen. Much of the interaction with patients takes place over the phone, while in the background Nudj Health uses algorithms developed through data accumulation from patients to guide the decision points.
“The pandemic really helped here, by making patients and providers realize the value of telehealth,” Sudhakar said.
The pandemic also served to broaden Nudj’s service offerings, he said. Because of to increased isolation brought on by measures intended to lessen the transmission of Covid-19, more patients are suffering from depression and are therefore less likely to be motivated to adopt healthy lifestyle habits.
“Maintaining good mental health has become an increasingly important part of what we do,” Sudhakar said.
 
Sudhakar previously co-founded and then sold a company that aggregated data from implantable pacemakers and other cardiology devices. That company, Geneva Healthcare, was sold to Malvern, Pa.-based Biotel Inc. in 2019. Biotel in turn was acquired by Phillips Healthcare Group, a unit of Amsterdam, Netherlands-based Koninklijke Philips.
Sudhakar stayed on at Biotel for a time, but left in late 2020 with an eye toward his next venture: using his data-aggregation acumen to improve behavioral health outcomes. He teamed up in late 2020 with an investment partner, Donald Cohn, and the pair launched Nudj in Feb. 2021. Cohn, who comes from the real estate sector, now sits on Nudj’s board.
Nudj is one of a growing number of companies that have launched in the U.S. and elsewhere over the past few years with this same goal: improving patient outcomes by changing lifestyle choices and behaviors.
“For decades, we’ve been trying to treat lifestyle-borne diseases such as obesity and (Type 2) diabetes with medications and treatments and procedures,” said Catherine Collings, president of the St. Louis, Mo.-based American College of Lifestyle Medicine; Nudj Health recently joined the college as a board member. “But now, the evidence has come in and we have found that not to be very effective.”
Collings said attention has therefore turned to the lifestyle and behavioral choices component of these diseases and conditions. This has been helped by increasing numbers of people trained as “lifestyle coaches” who can guide patients into healthier outcomes through improved nutrition and regular exercise.
Collings added that the focus on behavioral health components of chronic disease management differs from traditional corporate wellness programs. Those programs offer things like free gym memberships and health screenings but don’t assign individual lifestyle coaches to patients and don’t require patients to report key health vital statistics on a regular basis.
“You have insurers who are trying to figure this out,” she said. “And you have a growing number of smaller companies trying to get in and solve this in a more agile way, through the use of artificial intelligence that makes coaching more personalized and effective.”
One such company is Ontrak Inc., which earlier this year relocated to Henderson, Nev. from Santa Monica. Ontrak uses artificial intelligence programs and lifestyle coaches to help health care payors – chiefly insurers – save money through reduced patient hospitalizations.
But Ontrak ran into difficulties when two of its largest insurer customers – Aetna, a subsidiary of Woonsocket, Rhode Island-based CVS Health Corp., and Bloomfield, Conn.-based health giant Cigna Corp. – dropped its program. Aetna ended its participation, while Cigna switched to another behavioral health care startup, San Francisco-based Ginger.io, Inc.
Ontrak has been trying to broaden its customer base to employers and physician groups, but those efforts have been slow to take root.
Nudj, however, immediately focused on the health care provider market, especially physician groups.
“We come from the provider space and we understand how to work with providers in clinical work flow,” Sudhakar said. “That’s where the trust emanates.”
Throughout its first year, Nudj has focused mostly on the senior-care market. That’s because the federal Centers for Medicare & Medicaid Services agency, which administers the Medicare program, has approved the model of including mental health/behavior health services within provider networks.
“That means the providers get reimbursements from Medicare for mental health/behavioral health programs designed to improve patient outcomes, so they don’t have to spend extra money to partner with us,” Sudhakar said.
The providers are motivated to team with Nudj because of evidence from a University of Washington study showing every dollar spent on these programs yields roughly $6 in savings from reduced usage of more costly medical treatment, especially in a hospital setting.
Sudhakar said that within Nudj’s first 15 months, it had signed “somewhere around a dozen” contracts with provider groups. He declined to disclose revenue.
One of those provider groups is Foothill Cardiology Medical Group in Pasadena. The group’s president, Dr. Azhil (Alex) Durairaj, who is also medical director of the cardiovascular service line at Pasadena’s Huntington Hospital, said he’s been working with the Nudj Health team since its founding early last year.
“In the year or so since we really started using their program, we’ve seen a reduction of about 40% in anxiety, depression and insomnia scores among our patients,” Durairaj said. “We are also observing less spiking in blood pressure and more compliance with taking of medications.”
As a result, he said, “We are seeing fewer hospital and urgent care visits.”
But Durairaj pointed to one area of difficulty: some patients are concerned about the collection of blood pressure and other data points and how that data might be used in the future.
“I’ve had some patients decline to participate because they are concerned that the blood pressure readings might somehow end up in the hands of insurers and that their copays would suddenly increase,” he said.
But he said that is more than offset by a larger group of patients who are motivated to improve their behaviors because they know someone is monitoring them.
 
Nudj’s Series A $10 million funding round announced in April was led by Nebraska Medicine of Omaha, Neb.; San Diego-based Teal Venture; the Cohn Family Trust (of aforementioned real estate investor Donald Cohn); and Bay Area-based Health Innovation Pitch.
Sudhakar said some of this funding would likely be used to expand into the value-based medicine arena, where physician groups are given a set amount of money from health care payors to manage a certain number of patients and must try to find ways of saving treatment dollars in order to make money.
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