Ro, a direct-to-consumer virtual care company, is strengthening its foothold in women's health with the acquisition of reproductive health company Modern Fertility for an undisclosed sum.

As part of the deal, Modern Fertility's offerings will be offered via Ro's primary care platform. Like Ro, Modern Fertility built up a direct-to-consumer virtual health business. However, Modern Fertility offers users personalized at-home fertility tests or one they can take in the lab.

The original test is a hormone test that a clinician is able to review and communicate the results with the customer through a dashboard on an online portal. Users are able to share the results of the test with their doctors or care teams.

Customers are also able to opt into a one-on-one consultation with a fertility nurse or join webinars about fertility. The company has also expanded to offer Prenatal Multivitamins. And it is offering more tests, including a quantitative Ovulation Test, an early detection pregnancy test, a cycle tracking app and a fertility tracking tool, according to the release.

WHY IT MATTERS

Increasingly, health tech companies are focusing on meeting the needs of people with ovaries. According to UNICEF, around half of women, or 26% of the global population, are of reproductive age. However, there is still an unmet need when it comes to their health.

According to a report from Rock Health, the femtech sector represents only 3% of digital health deals in the U.S. since 2011. 

Among the femtech space, one major focus is fertility. According to the CDC, about 12% of women aged 15 to 44 in the U.S. have difficulty getting pregnant or carrying the pregnancy. With this new acquisition, Ro is now moving into the femtech and fertility space.

"About 1 in 6 couples struggle to conceive and yet there are only about 500 infertility clinics nationwide," Afton Vechery, cofounder and CEO of Modern Fertility, said in a statement. "We now have the opportunity to dramatically accelerate our vision of supporting women in every single step of the journey in reproductive care and beyond. With Ro, we will be able to drive better outcomes and lower costs for millions of women – and redefine women's health as we know it. I could not be more energized about the future of Modern Fertility."

THE LARGER TREND

Founded in 2017, Ro got its start in the men's sexual health and wellness space. Since then, it has quickly expanded its business to include services for smoking cessation, allergies,  women's health, dermatology and others.

In December, the company acquired in-home healthcare platform Workpath, which offered on-demand in-home care services through an API system. Since this acquisition, Ro has used Workpath's technology to make house calls to distribute the COVID-19 vaccine to older people and those with disabilities in New York.

The company has raised a whopping $876 million to date. That includes a $500 million infusion of cash in March. Today, the New York-based company brags of a $5 billion valuation.

Ro's main competitor in the direct-to-consumer space, Hims & Hers, went public through a SPAC with Oaktree Acquisition in January. In its first earnings call, the company reported beating its Q4 revenue expectations with a 67% year-over-year increase. However, stocks fell immediately after the report. At the time of the call, analysts pointed to lower-than-expected growth expectations as the cause.