The digital health world could be entering a new phase this year, one in which execution matters as much as innovation, according to leaders from venture capital and private equity firm Breyer Capital.
Here are three industry trends they think will shape market dynamics in 2026.
Biotech constraints are shifting from biology to logistics
This year could mark a turning point in healthcare innovation where the biggest challenges are no longer scientific but practical, said Bret Bostwick, who joined Breyer as venture advisor last month.
“In the past, the reason that we were stuck in certain therapeutic areas was because the biology wasn’t advanced enough for us to make that next step. Increasingly, we are understanding the biology very well but are limited by logistical barriers,” he remarked.
With the science largely in place, the real opportunity is in technologies that make therapies easier to deliver, cheaper to produce and simpler to scale, Bostwick said.
One key opportunity is shifting from ex vivo to in vivo approaches in cell engineering, he noted. This means instead of removing a patient’s cells, engineering them in a lab over weeks, and then reinfusing them, physicians could deliver therapies directly into the body that reprogram cells on the spot.
Bottom-up adoption
Healthcare startups’ go-to-market strategies are moving from traditional enterprise sales to direct-to-clinician and direct-to-consumer models, pointed out Morgan Cheatham, partner and head of healthcare and life sciences at Breyer.
Instead of navigating slow, complex procurement processes at health systems, companies are increasingly reaching users through product-led experiences that are adopted by clinicians first and later scaled across institutions.
“I’ll use OpenEvidence as an example, but there are others — we’re starting to see bottom-up motions where companies are going to market with delightful products that meet the needs of healthcare and life sciences users in a more accessible format,” Cheatham stated.
The rise of AI is also helping startups build and launch products faster and iterate directly with clinicians and scientists, he added.
While this approach can accelerate adoption early on, startups will eventually need to integrate back into enterprise systems like EHRs and claims platforms.
Consolidation is coming
The explosion of AI startups in healthcare has created a crowded market, and Cheatham expects this year to be a big one for M&A, especially when it comes to software.
Many companies will have to face a strategic question: Can you become a platform or category leader, or are you stuck in a niche that will be acquired or marginalized?
“It’s roll or be rolled,” Cheatham declared.
As healthcare organizations are reassessing their technology stacks and AI capabilities, they are increasingly favoring fewer, more integrated platforms over fragmented tools, Cheatham said. He thinks that shift will accelerate dealmaking and reveal which companies emerge as true winners.
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