by Dr. Gali Artzi, Eva Everloo and Anđela Martinović, PhD
Executive Summary
Healthcare systems worldwide are cracking under the pressure. A projected shortage of at least 10 million workers by 2030, costs spiraling upward, and a mounting burden of chronic conditions.1 The primary driver: noncommunicable diseases like cardiovascular disease, cancer, chronic respiratory diseases and diabetes – on the rise around the world, in part due to globalization, urbanization and lifestyle changes.2
The human toll is staggering. NCDs are the leading cause of illness and death worldwide; 43 million deaths a year – with 18 million of those before age 70.3 The trend is clear: unprecedented demand from both consumers and governments for preventative, cost-effective solutions that promote resilience and reduce susceptibility to disease.
So where do we go from here? This global health crisis is also a significant opportunity to innovate and invest, at the intersection of nutrition and technology. Two sectors lead the charge: nutraceuticals (combining “nutrition” and “pharmaceutical”) – ingredients like herbal extracts, vitamins, and food-derived compounds that may support overall health and wellness – and digital health, software-based interventions leveraging AI, biosensors, and remote monitoring to deliver personalized healthcare.
Together, they represent over $700 billion in estimated current market value, with nutraceuticals set to grow from $418 billion to $571 billion by 2029 and digital health projected to jump from $288 billion to $946 billion by 2030. But beyond market size, these solutions deliver where it matters most: cost-effectiveness that can fundamentally reshape healthcare economics while improving patient outcomes.
Innovators who successfully navigate clinical validation and regulatory complexity can both make substantial impact on global health, and capture outsized returns.
A Lay of the Land: Nutraceuticals and Digital Health
Nutraceuticals broadly encompass isolated nutrients (like vitamins, minerals and plant extracts), dietary supplements and functional foods and beverages to support health and potentially reduce risk factors for chronic disease (while not intended to diagnose, treat, cure, or prevent any disease). They can be used standalone or as ingredients within supplements, fortified foods, and medical nutrition.
Digital Health: Scalable Software as Medicine
Digital health is already transforming traditional healthcare models – enhancing patient engagement, improving adherence, and providing targeted support for chronic diseases and behavioral health conditions. The sector leverages advanced technologies like artificial intelligence (AI), large language models (LLMs), biosensors, and remote monitoring to deliver scalable and personalized healthcare interventions, empowering people to become active participants in their own health. Solutions are designed and validated through clinical trials, but offer unique advantages over static pharmaceutical interventions, evolving with patients and providing continuous support. Regular user engagement, with gamification, software updates, intuitive interfaces, and live support all help drive long-term adherence and effectiveness. Areas most relevant to PeakBridge’s scope include:
A Market on the Rise
Fueling growth across both sectors is rising consumer demand for scientifically validated health ingredients and a growing interest in preventative healthcare. The COVID-19 pandemic sparked a significant shift in purchasing behavior, sharpening focus on immunity-supporting products and personalized nutrition. In numbers – the $418 billion-dollar global nutraceutical market is expected to hit $571.3 billion by 20294; digital health has also experienced remarkable growth, with a global market estimated at $288 billion in 2024, projected to hit $946 billion by 2030.5
Better Health, Lower Costs
As always, cost effectiveness is ultimately key, and on that front both sectors deliver. With continued research and thoughtful integration, nutraceuticals may support overall health and wellness, contributing to healthier lifestyles and potentially reducing risk factors linked to chronic conditions like heart disease, cancer, Alzheimer’s, and cognitive decline. Take for example plant sterols or stanols, a plant-based nutraceutical. The European Food Safety Authority found a daily intake of 1.5 – 2.4 grams can lower LDL cholesterol by 7-10.5%, within just two or three weeks6. Another European study looked at adults with high cholesterol, concluding that a similar daily intake of plant sterols alone would cut related hospitalizations –and some €5.3 billion a year in healthcare costs.7
Likewise digital health solutions are tailored to improve health outcomes at a lower cost, often addressing gaps in traditional care models. With high scalability at minimal cost, these solutions can reduce hospitalizations and ease pressure on healthcare systems. An IQVIA study points to potential annual savings of $7 billion by applying DTx (digital therapeutics) in five patient populations. They also make economic sense for companies, who can leverage modular, cloud-based infrastructure to rapidly scale DTx solutions, often with initial investments below $5 million.8 Certain precision nutrition and health platforms have also shown good ROI for payers, leading to more integration into employer health plans and national reimbursement frameworks – a strong basis for startups to scale.
Bottom line: The growing burden of chronic conditions, spiking healthcare costs, and labor shortages simply aren’t sustainable. Coupled with a consumer push towards preventative healthcare, solutions are needed now. Nutraceuticals and digital health address all fronts, with improved health outcomes that are also cost effective.
Prove it: Paths & Hurdles in Clinical Validation
These sectors are, of course, all about our health – and that means clinical validation plays a pivotal role in go-to-market strategy. Unlike pharmaceuticals requiring strict regulatory approvals, nutraceuticals often bypass formal pathways, enabling faster market entry. Still, requirements vary by country, product composition, intended claims, and the manufacturer’s objectives.
Nutraceuticals face unique challenges: Unlike pharmaceuticals that target specific conditions, nutrients have complex systemic effects that are tough to capture. Inconsistent product composition can cause problems in standardization, and defining control groups can be tough since nutraceuticals often have multiple physiological effects that can’t be easily mimicked.
Another element to watch for is the widespread use of “borrowed science,” wherein companies support product claims based on studies of individual ingredients, even when the final formulation differs in dosage, combination, or bioavailability. It’s an approach that may expedite commercialization but doesn’t guarantee the same efficacy or safety in the real world. Many supplements on the market also rely on preclinical evidence limited to animal models, instead of full-scale clinical validation. This may likewise cut costs and shorten timelines, but risks consumer harm, legal consequences, and reputational damage in the long run.
Source: Dietary Supplement-to-Drug Strategy
Digital Health encounters different issues: Control group design is complex since these interventions include engagement and behavioral components that are difficult to replicate in placebos. Plus, user engagement and adherence depend on interface usability, motivation levels, and external distractions, creating variability in outcomes. Randomized control trials remain the gold standard but are far more complex, requiring researchers to systematically assess scientific robustness and real-world applicability. Traditional RCTs may not always be feasible, but demonstrating a measurable clinical impact is key for market credibility.
To keep innovation moving despite those challenges, some countries have already taken the lead with new frameworks. Germany’s DiGA requires at least one comparative study demonstrating healthcare benefits; the UK’s NICE Evidence Standards Framework classifies DTx into tiers, with higher-risk products requiring strong observational or quasi-experimental studies. Belgium’s M3 Validation Pyramid requires DTx to demonstrate both clinical and socioeconomic benefits to be eligible for reimbursement.
Navigating Regulation to Master the Market
Complex (and changing) regulation represents both the biggest hurdle and the strongest moat for companies in nutraceuticals and digital health. Startups must navigate the ambiguity, geopolitical shifts, and compliance hurdles to achieve sustainable growth; and understanding the frameworks is essential for investors evaluating market entry timelines, competitive positioning, and scalability. In the U.S., unprecedented tariffs and ensuing global trade reviews are disrupting global supply chains. An aggressive deregulation agenda seeks to streamline federal processes, including within the FDA, though along with it have come new uncertainties about regulatory guidance and maintaining oversight. Yet there are signs of increasing mainstream acceptance: the FDA has approved over 40 DTx products, and the U.S. is expanding telehealth reimbursement codes to support broader adoption. The European approach under EFSA has been more gradual. With a focus on modernizing risk assessment processes and increasing stakeholder engagement, the aim is to both drive innovation and uphold strict safety and scientific standards.
Drilling down further, each sector has its own nuances to know:
Nutraceuticals enjoy faster market entry but face ongoing compliance challenges. Unlike pharmaceuticals, they often bypass formal approval pathways, enabling quicker commercialization. This does come with trade-offs: Europe’s EFSA for example lacks clear distinction between food supplements and nutraceuticals in health claim assessments, making compliance and market positioning a challenge since each region may treat the same product differently. There are also hurdles in proving efficacy in healthy populations, and quality control issues from raw material sourcing that can trigger costly recalls. Medical foods are subject to more rigorous scientific and regulatory requirements with longer development timelines. They must demonstrate efficacy in managing specific diseases under physician supervision and are governed by distinct regulatory frameworks.
Digital health solutions vary widely when it comes to regulation and go-to-market strategy. Non-medical platforms that don’t make disease treatment claims, such as those improving access to nutritious food or specialized services like lifestyle coaching, can typically avoid FDA or CE approval and instead focus on HIPAA/GDPR compliance. These platforms can still demonstrate real-world impact (e.g, improved food access and reduced care costs), which may help gain traction with payers and providers to allow faster and wider deployment.
DTx that do make explicit treatment claims are a different story. They must navigate stringent medical device regulations and require robust clinical validation and compliance with evolving standards. Once those hurdles are overcome, startups enjoy stronger defensibility, trust from payers, and long-term integration potential. Ultimately, a company’s strategy must factor in regulatory timelines, go-to-market speed, and desired payer integration.
Market Entry and Reimbursement
Achieving clinical validation and regulatory approval are the first steps, but market adoption and reimbursement help define long-term success. Market adoption timelines vary by model: B2B approaches require negotiations with corporate partners (several months to a year for nutraceuticals) or healthcare providers and insurers (ranging from 1-3 years for digital health solutions, especially DTx). B2C models require consumer marketing, awareness building, and regulatory claim substantiation (up to 1 year for traction). Then there’s reimbursement, which remains challenging (but key) for digital health companies:
- DTx: For the EU, Germany’s DiGA process is considered the gold standard. But securing a permanent listing takes over 2 years in most cases, requiring extensive evidence generation, pricing negotiations, and compliance updates. Once reimbursement is in place, companies can focus on scaling operations and growing revenue. Factors influencing success include pricing models (subscription-based, transaction-based), market size, competition, and sustained compliance. The U.S. is a different case, with reimbursement for digital therapeutics fragmented and lacking a centralized pathway. Coverage depends on individual negotiations with commercial payers, Medicaid, or self-insured employers. Success relies on strong clinical and economic evidence, creative contracting, and navigating benefit structures.
- Non-medical digital platforms: These typically fall outside formal reimbursement frameworks in both Europe and the U.S. Many platforms instead pursue alternative go-to-market strategies, including partnerships with private insurers, employers, or regional health systems. In the U.S., adoption is often via Medicaid plans, self-insured employers, or managed care organizations. In both regions, uptake generally begins with regional pilots to demonstrate user engagement, cost savings (like reduced ER visits), and health-related outcomes. This route avoids some regulatory burdens, but does require robust real-world evidence, alignment with care delivery workflows, and close payer collaboration to scale effectively.
Bottom line: Companies with clinical validation and strong regulatory strategies stand out in crowded markets. Those that achieve reimbursement (particularly in multiple markets) command premium valuations and sustainable competitive advantages. In both sectors, early regulatory wins often predict long-term market success; interested investors should identify startups that treat regulatory strategy as a core competency, not an afterthought.
Deal Watch
Innovation and investment across both sectors are ramping up to meet the need. Nutraceuticals saw 960+ funded companies raise $9.53 billion in 2024, with digital health startups securing $10.1 billion across 497 deals.9 Multiple catalysts are behind the surge: rising health consciousness post-COVID, demand for personalized solutions, and new technologies enabling better patient outcomes. Europe’s evolving regulatory frameworks – particularly Germany’s DiGA pathway – is also attracting capital to digital health, with European early-stage investments now rivaling U.S. levels.
Several deals reflect strategic consolidation in addition to growing investor interest. Notable exits, IPOs and acquisitions in nutraceuticals over the past five years have involved heavyweights like DSM-Firmenich, Nestlé Health Science, ADM, Kerry Group, and Balchem, as well as PE funds – a dynamic environment where established brands and new entrants are driving innovation and competitive consolidation. Take Turnspire Capital Partners’ 2024 acquisition of Ashland Inc’s nutraceuticals business, and this year, private equity firm Astorg’s majority stake in Solabia Group,a provider of biotech ingredient solutions. Other deals of note in 2025 include two major IMCD’s acquisitions: TECOM Ingredients, targeting specialty wellness and nutraceutical ingredients, and Ferrer Alimentación, a major boost to its share of nutraceutical distribution.
Digital health has also seen a number of big-name, big-ticket deals.
Among them is Omada Health, an AI-powered virtual chronic-care platform, earlier this year raising $150 million in its IPO at a $1.3 billion valuation. Major funding rounds include Glooko, a developer of a remote patient-monitoring platform, with a $100 million Series F in late 2024; health tech company Huma’s $80 million round in 2024 led by Hitachi Ventures, AstraZeneca, and Bayer, and a $70 million check with a unicorn valuation for Nourish, avirtual, insurance-covered nutrition counseling startup.
The PeakBridge Portfolio: Advancing Food & Technology as Health
With growing demand from payers, corporates, and consumers for scalable, preventative solutions, we see this space as a high-impact, undercapitalized opportunity aligned with PeakBridge’s food-as-health thesis. Even more so as the ROI of these solutions becomes increasingly evident: clinical health offers a measurable, cost-effective way to address massive unmet needs in global health, particularly in chronic disease.
PeakBridge backs startups that pair scientific and clinical rigor with commercial scalability; companies that bridge the gap between healthcare needs, technology, and strategic go-to-market execution, including regulatory and reimbursement pathways. As early regulatory clarity emerges (e.g. DiGA and PECAN in Europe), we see increasing opportunities to invest in companies not only backed by strong science, but also structurally positioned for long-term payer integration and scale.
The Takeaways
The convergence of nutrition and technology represents a compelling investment opportunity: fueling it is a perfect storm of urgent global health needs, consumer demand, technological innovation, and emerging regulatory clarity. Crucially, these innovations can drive significant economic outcomes – reducing the burden of chronic disease, lowering healthcare system costs, and enabling broader access to affordable, preventative solutions.
Companies successfully navigating hurdles like clinical validation and regulation can capture outsized returns in markets experiencing unprecedented growth. Key success factors include strong clinical backing demonstrating functionality beyond existing solutions, strategic navigation of regulations to create competitive moats, scalable technology platforms enabling rapid expansion, and clear reimbursement pathways for sustainable revenue models.
Together, the nutraceutical and digital health sectors are shaping a more scalable, data-driven, and accessible future for healthcare, creating significant opportunities for investors positioned at this critical intersection.
- McKinsey Health Institute 2025 ↩︎
- NIH; The Lancet 2022 Commission Report; UN 2023 NCD Political Declaration ↩︎
- RTI International; WHO 2024 NCD Fact Sheet ↩︎
- BCC Research Nutraceuticals Market Report ↩︎
- Grand View Research Digital Health Market Summary 2024 ↩︎
- EFSA Scientific Opinion, 2012 ↩︎
- Healthcare Cost Savings of Phytosterol Food Supplements in the European Union (2017) ↩︎
- NIH National Library of Medicine, “Digital Health Promotion: Promise and Peril” ↩︎
- Tracxn Nutraceutical Market Map; Rock Health 2024 Digital Health Funding Report ↩︎