94% of Digital Health Companies Outsource Activities to External Service Providers

A new global survey by Research2Guidance explores outsourcing trends in the global digital health market, revealing high demand areas for outsourcing services. Most digital health companies have outsourced or plan to outsource technical, business, legal, and service delivery activities to external service providers in the near future. New outsourcing matching service launched on R2GConnect.

Delving into the landscape of outsourcing within the global digital health sector, the latest survey “Digital Health Startups: Outsourcing Needs” by Research2Guidance explores the outsourcing potential in the industry and the support areas that digital health companies plan to outsource activities, to develop or manage their digital health solutions.

The study garnered responses from 293 stakeholders across digital health, medtech, pharmaceuticals, and research institutions all around the world. Of the participating companies, 98% offer or develop a digital health solution in different stages ranging from ideation to market and service expansion.

The results provide a unique pulse check for the first time on the demand for external service providers in digital health globally, looking at the engagement trend between the digital health solution providers and external service providers, detailing the areas of outsourcing and the planned budgets, and the range of challenges encountered in outsourcing.

There’s certainly a notable potential and demand for outsourcing in the global digital health industry to benefit from the specialized expertise of external service providers. Over the past two years, outsourcing has been widely utilized by digital health startups and established players (94%). However, their engagement outlook in 2024 shows a mixed trend.

While the startups who were highly engaged with service providers stressed out a decrease in outsourcing in 2024, the previously rare engagers are expected to increase their outsourcing projects in the next months of 2024. Some of the reasons behind the decrease in a high level of engagements can be, as mentioned by the participants, related to lack of time to find the right service provider or insufficient granularity offered in the outsourced projects.

Besides the past and future trends in engagement levels, the survey also dives into the specific needs of digital health companies in 4 different service area categories.

Specialized expertise in medical software development is going to be the most needed request in 2024 (60%) among the technical needs of digital health companies.

For service delivery, HCP brokerage services are also projected to be one of the greatest demand in the next 12 months (59%), underlining the importance of collaborating with healthcare professionals (HCPs) for digital health startups and grownups (For more details, refer to R2G’s Whitepaper on ‘How to engage with HCPs for a successful DIHA?’).

Regarding business support needs, partnership building services are going to be in high demand (53%) in 2024, along with investor search (51%) and business growth consulting services (49%).

Expert service providers for ISO certification and IP protection are also needed by 41% of the digital health companies, alongside the nine other legal and regulatory support areas mentioned in the survey.

The survey results also show that the participated decision-makers in the digital health market are aware of the outsourcing costs and typically plan to allocate the largest budgets ($230K USD on average) for technical and business growth projects.

While the overall study shows that there has been a demand for outsourcing, it also underscores challenges in outsourcing projects. Over 50% of the digital health stakeholders shared that they spend “a month or more” to find the right service provider. Additionally, excessive costs of the outsourced projects are identified as the main obstacle to concluding a service provider deal.

R2GConnect, the world’s largest partnership matching platform for the digital health industry with more than 8,000 digital health startups registered, now offers a new service where startups and service providers can post help requests and offer assistance.

Startups can choose from 30+ service categories, specify their needs, and set their budgetall for free. And the service providers from all over the world can offer their services.

With R2GConnect’s innovative platform, collaboration between digital health companies and service providers becomes not only more efficient but also a catalyst for accelerated growth and success in the digital health ecosystem.

To learn more about R2GConnect’s new service offerings “Help Requests” & “Deals“, please book a demo session here: https://www.r2gconnect.com/r2g-demo-booking