* The Paycheck Protection Program, created by Congress as part of a $2 trillion coronavirus bailout, helped small businesses stay afloat as they struggled economically during the pandemic.
* Businesses were allowed to qualify for up to $10 million in loans.
* On Monday, the Trump administration released the list of companies that borrowed most of the money. We spotted some applications from health-tech companies among their ranks, many of which are backed by venture capital firms.
* Companies that applied for loans include ZocDoc, HealthTap, Bright.md, and Wildflower Health.
* For more stories like this, sign up here for our healthcare newsletter, Dispensed.
Health-tech startups were among the recipients of federal loans intended to help small businesses stay afloat during the coronavirus pandemic.
Several of the startups have raised tens of millions from venture capital firms. Still, their business models became strained amid the pandemic, they told Business Insider.
Even in a major public health crisis, the healthcare sector has struggled financially. Patients put off checkups and surgeries that weren't emergencies, which led to paycuts and furloughs for healthcare workers, and pummeled hospital revenue. The effects bled into health-tech companies.
Read more: Pay cuts, furloughs, and layoffs for doctors, nurses, and other healthcare workers are mounting as the coronavirus pandemic hits hospitals
In response, the startups turned to a coronavirus bailout created by Congress for relief. The loans in question were administered by the Small Business Administration through the Paycheck Protection Program. They can be forgiven as long as businesses kept workers on payroll.
When PPP launched, it created confusion and came under criticism for letting publicly traded companies get loans. Venture-backed companies have also drawn criticism for using the program, because of their ability to draw on existing investors for additional capital.
Read more: More than 4,800 startups that applied for federal PPP loans in the coronavirus-led shutdown had raised venture funding in the last 2 years
After only 12 days, the fund ran out of money, forcing Congress to replenish it. In all, Congress set aside $670 billion for the loans, which are still being administered.
On Monday, the Trump administration posted a database of all recipients who got $150,000 or more in loans. The maximum permitted under the law was $10 million.
More than 660,000 companies were listed in the SBA database, out of almost 5 million total. Businesses in the healthcare industry represented the largest share, at 12.9%.
Not all the information is up to date. A senior SBA official told Business Insider that the database may include some employers that ended up returning loans if the banks that administered the loans didn't cancel the applications.
Zocdoc, for instance, is listed as receiving a loan for between $5 million and $10 million. The company said that it returned the loan more than a month ago after its business started to recover.
Its business, which relies on patients booking in-person doctor visits, suffered when physicians were seeing fewer patients due to stay-at-home orders. Zocdoc was able to reach sturdier financial footing by arranging telehealth visits and obtaining additional capital, the company said.
Read more: There's a billion-dollar fight brewing over whether doctors should be paid for phone calls and video visits. Who wins could determine the future of healthcare.
Nine other health-tech companies, listed in alphabetical order below, confirmed they did borrow from PPP or are in the process of doing so.
Though SBA only posted the range of funding companies received, several firms confirmed exact figures to Business Insider. The SBA data also included the number of jobs the loans supported.
To assemble the list, we searched the database for companies that have caught the eyes of top venture capitalists amid the pandemic, as well as telemedicine startups and companies that received unicorn status. Some companies also were noted on social media.
Here are the health-tech companies that got PPP loans and how they're using that money.
Know of a health-tech company we missed? Let us know by emailing kleonard@businessinsider.com.
Bright.md applied for a loan of between $1 million and $2 million.
Bright.md is a telehealth startup. Its platform, SmartExam, uses computers and smartphones to automate parts of doctors' appointments, mostly for urgent and primary care.
The company applied for a loan of between $1 million and $2 million, it confirmed to Business Insider.
"We are committed to our employees, our customers and the communities we serve, and in these uncertain times we are continually evaluating options and taking actions to help ensure stability," Bright.md said in a statement. "As part of those preparations, we have applied for a PPP loan."
Funding raised: Bright.md raised an additional $16.7 million from investors including Concord, B Capital and Seven Peak Ventures in May. In total, the company has raised about $30 million.
Number of jobs to support: 72
HealthTap received between $1 million and $2 million.
HealthTap provides health advice by connecting primary care doctors to patients through video, voice, and text. It also has a tool that helps patients assess whether it's time to see the doctor.
The company received a loan from the Paycheck Protection Program of between $1 million and $2 million.
"Given the unprecedented uncertainty in the early days of the pandemic, my job was to plan for every possible business scenario," Bill Gossman, CEO of HealthTap, told Business Insider, about the company's decision to apply for the PPP.
Funding raised: HealthTap has raised tens of millions from venture investors including Khosla Ventures and Mayfield Fund.
Number of jobs supported: 45
Lumos Diagnostics received $1.9 million.
Lumos Diagnostics provides testing and uses digital readers to help healthcare providers diagnose patients and manage disease.
A $1.9 million loan was able to support workers at the company's two locations in Sarasota, Florida, and Carlsbad, California.
Aaron Erlandson, senior vice president of finance, said the filing reflected employee salaries but not overhead costs. The company suffered because fewer patients have been seeing doctors during the pandemic.
"The PPP program coupled with our bank partners enabled Lumos to sustain its existing team through these unprecedented times," Erlandson said.
Funding raised: Lumos in February raised $15 million in venture funding from investors including Austrailian company Planet Innovation.
Number of jobs supported: 16
Nomad Health received between $5 million and $10 million.
Nomad Health is a startup that connects healthcare facilities with freelance doctors and nurses.
CEO Alexi Nazem confirmed the company received a PPP loan between $5 million and $10 million, but declined to specify the amount.
Nomad has been able to mobilize doctors to help with the pandemic response but the company also suffered when other specialists weren't needed as much given that routine care and elective surgeries were put on hold, Nazem said.
"The need for staff has decreased in some areas," he said. "It has been a real roller coaster."
Funding raised: Nomad most recently raised $34 million in August 2019 in a round led by Icon Ventures. In total, the company has raised about $50 million in venture funding.
Number of jobs supported: 280
NowRx received between $350,000 and $1 million.
NowRx offers same-day delivery for prescription drugs.
The company received a loan that was between $350,000 to $1 million.
CEO Cary Breese said the loan helped defray additional expenses NowRx incurred during initial phases of the pandemic, including paying hazard pay to employees, overtime pay to meet surging demand, reliance on higher wage part time and temporary staffing services, additional cleaning procedures, and more.
Funding raised: NowRx crowdfunds its investments. The company raised $7 million in its Series A through crowdfunding and is now looking to raise $20 million in its Series B through crowdfunding.
Number of jobs supported: Not specified
Owlet Baby Care received $2.1 million.
Owlet Baby Care tracks babies' heart rates, oxygen, and sleep, while also streaming them on live video.
The Salt Lake City-based small business confirmed it received a $2.1 million loan.
Funding raised: Owlet in 2018 raised $24 million from investors in a round led by Trilogy Equity Partners, bringing its total raised to nearly $50 million.
Number of jobs supported: 102
Proteus Digital Health received $2.23 million.
Proteus Digital Health makes digital medicines that use tracking and sensors to make sure people are taking their prescriptions. Its sensor was the first of its kind to receive clearance from the Food and Drug Administration.
The company had furloughed most of its employees in November after $100 million in funding fell through. At the start of this year, Proteus shifted from focusing on treatments for mental disorders to treatments for infectious diseases and cancer.
Funding raised: Proteus filed for bankruptcy on June 22, and its $2.23 million PPP loan was part of public record through a company filing with the bankruptcy court. The company had previously been valued at $1.5 billion after raising a total of $420 million from investors.
Number of jobs supported: 93
Virta Health received between $2 million and $5 million.
Virta Health is a company looking to reverse type 2 diabetes using virtual care and the keto diet. It works with health plans and large employers to provide that service.
The company confirmed it received a loan of between $2 million and $5 million.
Funding raised: In January, Virta raised an additional $93 million in a round led by Caffeinated Capital. In total, the company has raised $166 million.
Number of jobs supported: 152
Wildflower Health received $1.3 million.
Wildflower Health provides health programs for family planning and parenting.
Wildflower received $1.3 million from the PPP. Half of its clients are healthcare providers, and when they took a financial hit then Wildflower did too, said CEO Leah Sparks.
"I think it has truly saved a lot of jobs including at companies like ours," Sparks told Business Insider in an interview. She applied for her staff because she didn't want to lay off workers and wanted the business to keep providing information for patients, she said.
During the pandemic, the company has given doctors blood pressure information to help them monitor patients remotely, and released tips for parents who are homeschooling and working from home. It also made Wildflower available to independent obstetrics practices at no cost to them.
Funding raised: Wildflower in 2018 raised $8 million from investors including Health Enterprise Partners, Hatteras Venture Partners, and Echo Health Ventures.
Number of jobs supported: 54
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