Digital chronic condition management company DarioHealth announced Thursday it had entered into an agreement to acquire Physimax, a company that offers AI-enabled movement assessment and injury prevention.

The deal, which needs regulatory approval from the Israel Innovation Authority before it closes, will cost Dario up to 256,660 shares of its common stock and a cash payment of $500,000. The digital health company also agreed to assume certain liabilities worth about $1,020,000.

The acquisition adds to Dario's investments in digital musculoskeletal (MSK) care. In January 2021, the company moved into the space when it announced plans to purchase Upright Technologies. It revealed a posture-correcting sensor in June and launched its own MSK care platform, Dario Move, in October.

Physimax, which is used by athletes, the U.S. military and providers specializing in orthopedic care, was set to be acquired by Australia-based Advanced Human Imaging, but the deal broke down late last year. 

WHY IT MATTERS

Musculoskeletal conditions are the leading contributor to disability worldwide, affecting around 1.71 billion people, according to the World Health Organization. 

Dario is positioning the deal as a way to improve their MSK care offerings without adding to staff workload.

"We are committed to bringing cutting edge technologies to our suite of offerings to enhance the user experience and improve outcomes. We believe that Physimax's technology strengthens our ability to scale highly effective treatments for musculoskeletal health and reduce the burden on Dario professional human support.

"Physimax's technology supports rapid growth of membership without the traditional limitations of MSK care delivered by humans," CEO Erez Raphael said in a statement.

THE LARGER TREND

Digital MSK and physical therapy are a growing market in digital health, and others in the space have scored sizable funding rounds.

Hinge Health, which also announced its own acquisitions of pain relief wearable make Enso and computer vision technology developer wrnch, raked in a $300 million Series D and a $400 million Series E, plus another $200 million secondary investment to acquire ownership last year. 

SWORD Health had several funding rounds in 2021, including a $163 million Series D and a $26 million secondary round that boosted its valuation to $2 billion. It also bought Vigilant Technologies, maker of a wearable that aims to prevent workplace injury.

Others in the space include Kaia Health, Omada Health, RecoveryOne and SpineZone.