What’s driving digital health innovation?
McKinsey define five key industry forces driving technological innovation:
- Longstanding industry inefficiencies leading to affordability, outcome, and quality challenges, and poor consumer experience.
- High rates of healthcare technology investment. From 2014 to 2018, there have been more than 580 healthcare technology deals in the United States, each more than $10 million, for a total of more than $83 billion in value. They have been disproportionately focused on three main categories: patient engagement, data and analytics, and new care models.
- Technology giants are locked in a trillion-dollar battle to win public cloud share and retain consumer “mindshare” – they are investing billions in R&D dollars to create services easily usable by a range of customers and for a range of applications that accelerate innovation. Increased integration (e.g. between pharmacy providers or health systems and technology companies) as well as rising concerns around patient privacy creates opportunity to leverage tech giant innovation and improve cost and quality of healthcare.
- Regulatory changes pave the way for integrated data sharing, and greater transparency for consumers.
- Healthcare industry incumbents are acquiring capabilities to advance their ecosystems. Payers, providers, healthcare services, and technology firms are acquiring assets to extend their data and analytics capabilities and engage with patients longitudinally.
ANDHealth reports that, in Australia, changes in provider, practitioner and consumer behaviour are enabling companies focused on digital health innovation to develop and commercialise domestically as are result of:
- Programs that improve connectivity within and between hospitals
- Uptake of MyHealthRecord and e-prescribing capabilities
- An openness by governments to consider changing reimbursement and procurement frameworks.
Has COVID-19 helped?
The Australian Government has stated that it managed to implement a 10-year reform plan in only 10 days for the universal reimbursement of telehealth for all Australians.
That graphically highlights the importance of regulatory reform, and the case for targeted physician reimbursement as an incentive for implementation, uptake and adoption of digital health technologies throughout the clinical community.
Telehealth is here to stay. It has universal consumer support and widespread physician support. The government will be refining its modelling over the coming 12 months, but a return to past stand-offs with industry seems inconceivable.
International reports indicate significant drivers of digital health in a post-pandemic world. In the UK, for example, continued growth is expected in:
- The diabetes market, with the advent of continuous glucose monitors.
- Treating mental health and addiction (digital healthcare is a key tenet of the UK NHS five-year strategy to treat mental health).
- Digital therapeutic treatments in oncology and neurology, which are increasingly found to be effective as therapies for rehabilitation and prevention of such diseases.
But innovation – from R&D through to commercialisation – only occurs with investment. New innovations need sustained injections of capital.
Following coronavirus announcements from China in January 2020, global investment into the digital health sector has dropped dramatically. Perhaps not understandably, investors were immediately focused on survival and not new deals. This arrested an escalating trend of investment in digital health.
However, with once ‘safe’ asset classes such as commercial property and extractives rocked by the pandemic and (the latter) predicted to enter climate related decline, health promises consistent demand and, in a range of areas, digital health has just been through a rapid proof of concept.
US digital health investment group Rock Health predicts greater growth in telemedicine and remote monitoring, alongside symptom checking and triage tools, digital therapeutics, tools which expedite drug discovery and clinical trials, and clinical decision support technologies than would have been expected prior to COVID-19.
In Australia, we will see the introduction of Software as a Medical Device regulations by the TGA in February 2021. It is not clear how this will affect the existing solutions being offered, and those in development, but it is a milestone in the journey of digital solutions from niche to mainstream usage and effectiveness.
How can we help?
Damien Bates, Chief Scientific Officer and head of translational medicine at BioCurate (University of Melbourne and Monash University), recently wrote that Australia ranks relatively poorly in bringing new treatments to market.
“We must foster better connections between academia and industry, to accelerate the realisation of our potential, the translation of our discoveries, and the pathway to achieving impact,” he said.
While Biocurate is mostly focused on biomedical treatments, the same can be said for digital health innovation. Bates states there are three key factors in successfully developing and bringing innovations to market: communication, collaboration and commercialisation.
“Commercialisation is a team sport,” he says. “One of the shortfalls in Australia’s innovation ecosystem is the limited opportunities to form … multidisciplinary teams”.
“Within a multidisciplinary team, open two-way conversation can build trust, create new ways of working and help the exchange of ideas. With different people from different backgrounds contributing and driving development during certain stages, innovative solutions can arise.”
Six years ago, Ellis Jones established a social impact practice to pursue our social purpose by addressing the gap between our market research and communications services. Led my Melanie Yap, the team runs innovation (design) processes leading to strategies that reorient companies in pursuit of growth, or solutions that address a market opportunity – always with financial and social impact as the objectives.
For example, we have just completed a co-design program with major NSW community health provider, Hunter Primary Care. The project focused on application of technology in improving health outcomes for Aboriginal people with complex health needs in the broader Hunter region.
The team analysed systems interfaces, employee and user behaviour, and intersections with other health, social/welfare and education providers. We then ran a collaborative co-design process with company experts and leaders, heath services users and stakeholders from Aboriginal communities.
Among the outcomes was a deeper understanding of the ecosystem and the use of technology to facilitate diagnosis and treatment via shared digital platforms and connected devices.
Instead of relentlessly attempting to coerce, for example, young Aboriginal men, to turn up for consultations, by adapting to their digital behaviour a relationship can be formed which opens-up the necessary space for transparent dialogue and treatment. A cloud-based platform which protects privacy but can be accessed at any time by nurses, social workers and health service users, can maintain supports and guidance more frequently and more effectively than in a traditional consultation setting. And the technology already exists.
In fact, once established, the solution could evolve to a platform business model that creates value by facilitating exchanges between health service users, primary health providers and consumer and allied health providers. The basis for its success being that the platform would be designed with Aboriginal people for them – it has trust, credibility and endorsement.
The potential financial benefits are significantly improved employee productivity freeing staff to see more patients and achieve a greater overall volume of paid consultation, and data analysis leading to more accurate treatment. The potential health impacts are more effective prevention, shorter treatment times as well as patient empowerment through education and information exchange.
As Professor Ara Darzi, Director Institute of Global Health Innovation at the Imperial College London, says, “Our healthcare system, like all health-care systems, is designed as a ‘sickness service’ rather than a ‘health and well-being service’. The value proposition has been treating the sick. But the value proposition has to change, in fact, to preventing illness.”
That starts with embedding researchers and health professionals with users who can shared lived experience, building multidisciplinary teams with skills and expertise beyond health (e.g. innovation, finance, psychology), tapping into the experience of focused organisations such as the Digital Health CRC and finding investment partners (such as social impact investors) who share the objective of shared value creation.