DRIO: A Torrent of New Contracts

By John Vandermosten, CFA



Progress Update

DarioHealth Corp. (NASDAQ:DRIO) has added a number of new clients since our last update, continuing its momentum with the B2B2C initiative. Recent wins include:

➢ RPM contract with Coastal Family Health Center – June 2021

➢ Three new employer contracts announced for wayForward – July 2021

➢ Selected to provide RPM for Alabama Regional Medical Services (ARMS) – July 2021

➢ Workplace Options adds Dario’s global behavioral health solution – July 2021

➢ National employer selects Dario’s behavioral health solution – August 2021

➢ Chosen by PeopleOne Health as digital behavioral health partner – August 2021

➢ Selected by employer for behavioral health services – September 2021

➢ Chosen by Northeast regional employer – September 2021

➢ Agreement with global employer for metabolic and MSK health solutions – October 2021

➢ Agreement with leading national health plan – October 2021

➢ Contract with US national employer for full, multi-condition DTx suite – October 2021

➢ Joins Virgin Pulse partner network – October 2021

➢ Contracts with Hawaii and metro Atlanta providers – November 2021

Recent B2B2C Wins

Dario continues to realize its B2B2C strategy and has announced numerous wins. We see the national health plan and multi-condition agreements as particularly attractive. Below we provide a summary of the partnerships and contracts that Dario has publicly announced year-to-date in 2021.

Over the last several months Dario has added many new clients in the remote patient monitoring (RPM), national employer, global employer, health plan and other categories as it continues to advance its B2B2C initiative. As of its last update, Dario had a total of 39 clients,2 with an acceleration in count that builds on its recent acquisitions of Upright Technologies and wayForward. The number of users on Dario’s platform has grown significantly and consisted of more than 197,000 members at the end of the second quarter. We anticipate that this number will grow substantially as the announced contracts begin to enroll patients.

Dario’s Strategy

The numerous announced contracts are evidence of a successful evolution of Dario’s strategy to build on the three pillars of growth:

➢ Transformation into a high-margin software as a service (SaaS) business model;

➢ Transition into a business-to-business-to-consumer (B2B2C) digital therapeutics provider; and

➢ Expansion into service offering addressing multiple chronic conditions.

Over the last two years, the implementation of this strategy has led to the acquisition of two synergistic platforms, Upright Technologies in musculoskeletal (MSK) and wayForward in behavioral health space, complemented by organic growth into hypertension management and remote patient monitoring (RPM). Company research has shown that some 35% of corporate clients want to offer digital therapeutic services in multiple conditions to their employees, with a strong preference for Dario’s recently acquired offerings.

Dario’s marketing teams are aligned by customer type and channel rather than by condition, which allows sales representatives to offer the entire platform. A prospect interested in any of the offered conditions can be cross-sold, leveraging a strategy that will more efficiently use the time and efforts of the marketing team. This approach will fundamentally improve the opportunity set for Dario in several ways. It can achieve an:

➢ Improved win rate due to expanded offering addressing a wider range of client needs;

➢ Increase in eligibility rate of covered lives from 20% to 40%; and

➢ Expansion of average revenue per user (ARPU) from $60 to $80 per member per month.

Success along these three parameters will drive better margins, greater revenue growth and an improved win rate compared with the previous iteration of Dario Health. The company is focused on internal development of its product capabilities and has built up a backlog most recently reported at $900 million. Most prospects are on a normal calendar, with contracts beginning in January 2022. This means that announcements in the fourth quarter of 2021 will provide an indication of the longer-term success of Dario’s efforts converting the backlog of revenue generating customers for next year.

Partnerships and Initiatives

Virgin Pulse Network

On October 27, 2021, Dario announced that it had partnered with Virgin Pulse, the leading global provider of digital and live health and wellbeing solutions, making Dario’s DTx platform available for contract through Virgin Pulse to employers and health plans around the world, specifically, through Virgin Pulse’s Homebase for Health solution. Dario’s preconfigured benefits will be available to eligible employees and health plan members. Benefits will include support for diabetes, hypertension, weight management, MSK and behavioral health, again, driven by Dario’s AI engine to personalize support for every patient’s management of one or multiple chronic conditions.

Workplace Options

On July 27, 2021, Dario announced that it had partnered with Workplace Options (WPO), the largest independent provider of integrated employee wellbeing solutions around the world, to offer Dario’s digital behavioral health solutions. WPO services enable platform access in all languages. Together with Dario’s recently acquired wayForward, Dario’s offering now accommodates multinational customers who have employees across the globe. These international employees will no longer experience a language barrier and will be able to access Dario’s behavioral health platform. Likewise, Dario’s potential customer base can expand accordingly. WPO’s language support will be fully integrated into Dario’s API.

Workplace Options is an employee support service centered on wellbeing and provides information, resources, referrals and consultation on a variety of issues including dependent care and stress management. WPO has service centers in the US, Canada, UK, Ireland, Portugal, France, Belgium, UAE, Singapore, Japan, China, India and Indonesia that support over 116,000 organizations and their 70 million employees in more than 200 countries and territories.


Adding to a list of wins in Dario’s B2B2C initiative, the company announced on April 20, 2021 that it had entered into a partnership with MediOrbis, providing remote patient monitoring (RPM) services to MediOrbis for Medicare patients with diabetes. MediOrbis is a telehealth provider specializing in chronic conditions. Covered members having Medicaid can receive, under existing Medicare benefits, telehealth support provided by MediOrbis and RPM provided by DarioHealth. The virtual care program will also be made available to Dario’s approximately 75,000 members with diabetes with 30% of these members over age 65. The virtual care program will also be marketed to qualified Medicare members who are not current Dario members, a population that the Centers for Medicare and Medicaid Services (CMS) estimates to be 20% of its 62 million beneficiaries.

Dario Move

On October 18, 2021, Dario announced that it would unveil Dario Move at HLTH 2021. Dario Move is the result of integrating Dario’s recently acquired MSK solution, Upright Technologies, marking approximately 9 months since the acquisition. Integration of the solution is key as Dario’s mission is to provide a holistic, comprehensive digital therapeutics platform to business clients, which can then support employees in the crucial majority time between physician’s visits. Dario Move makes it easy for end users to improve their MSK health by combining adaptive software, technology and personal support and leverages the acquired technologies: single biofeedback sensor, personalized, evidenced based exercise programs designed by physical therapists, real-time feedback, real-time support from coaches and physical therapists, and a highly personalized experience driven by Dario’s AI engine.


Dario has been active over the last two years implementing its new strategy with the pace of activity accelerating into 2021 with two acquisitions and several new deals announced in behavioral health, remote patient monitoring and other critical areas. Since June, we count 15 new client relationships and collaborations with multiple networks to reach even more users. The company has made progress strengthening its pillars of growth and has improved its capacity to improve win rates, eligibility and revenues per user. The efforts will consume substantial resources and we increase our operating costs accordingly. We expect further contract wins that build off of recent successes and conversion of backlog into long-term relationships.

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1. Compiled by Zacks Analyst from public domain

2. With the new additions this number is likely 10 greater or about 49.

3. Dario Corporate Presentation, September 2021.

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