Digital health is a complex, dynamic and extremely regulated market. In the past few years, the investment landscape has been boosted by the increasing importance of novel solutions and services for population health. Digital health market attracted different stakeholders, including big tech companies, who have entered it with bold missions to make a positive impact and reshape the space, but faced challenges and so far, the success is limited. (e.g., Microsoft and Google’s EMR failures, Amazon’s latest announcement of shutting down its telehealth offering, Amazon Care). So, how to be successful in the digital health market?
Digital health market is set to transform lives by providing tailored quality care solutions and services to deliver better care outcomes to large patient populations at a reasonable cost. Investors are lining up as the opportunity is huge to generate revenues. Different stakeholders are trying to change healthcare by leveraging digital technologies to develop state of the art solutions and services to empower patients and support doctors and care teams. The challenge faced by many market players, including big tech companies is that it is a very dynamic, data-driven and regulated market. A market in which building trust is crucial and understanding the patient-doctor relationship and care teams dynamics is vital. Having insights about different market segments and health systems structure, getting access to continuous real-time market insights, carefully observing success stories and applying the transferable learnings to one’s business are just some of the generally recognized factors which contribute to success.
RUNNING THE DIGITAL HEALTH AGENDA – TRIAL- AND-ERROR PROCESS
Still, running the digital health agenda, incorporating innovative solutions, scaling and monetizing is based on a trial-and-error process for many businesses. And even successful and well-known companies like Amazon face setbacks and are forced to change their strategy for some of their healthcare ventures.
Just recently Amazon announced that by the end of 2022 it will shut down its telehealth offering, Amazon Care. According to an internal memo the Amazon senior vice president of health Neil Lindsay said “Although our enrolled members have loved many aspects of Amazon Care, it is not a complete enough offering for the large enterprise customers we have been targeting and wasn’t going to work long-term.” This comes a month after Amazon has entered an agreement to acquire primary healthcare company One Medical for $3.9 billion. The deal still has not been closed as it needs to be cleared by financial regulators. Amazon has other ventures in healthcare that stood with time, like acquiring PillPack in 2018, which allowed the company to expand into medicine retail and adherence business in the USA. Leveraging its Echo smart speaker and Alexa to be offered as a virtual assistant to the consumers with healthcare needs.
SUCCESS DRIVERS: HOW TO MAKE SENSE OF THIS EVER CHANGING MARKET
Digital health market has its triumph stories that prove that being adaptive to this uncertain and dynamic market needs with the right approach and digital health strategy can lead to success. One Drop developed one of the first direct-to-customer diabetes service offerings and was among pioneers of app-based digital diabetes coaching services. It has also started to target employers and health insurers, mainly in North America but also in Western Europe and the Middle East. Today the company supports people in the management of prediabetes, high blood pressure, high cholesterol and any combination of these conditions. With Bayer’s financing and commitments of nearly $100M, One Drop has announced in October 2021 new heart disease prevention tool and plans to further expand to areas such as oncology and women’s health.
ResMed, a connected respiratory device maker, is another interesting example of a company taking advantage of different market opportunities and expanding its business capabilities by buying companies which are already successful in the segments the company is interested in. ResMed’s latest announcement is to acquire Medifox Dan, a German out-of-hospital software company for $1billion. The deal is subject to regulatory clearance. ResMed has also acquired the digital respiratory company, Propeller Health, EHR maker MatrixCare and post-acute software company Brightree.
There are various ways to upscale service offering, enter new markets and become one of the prominent market players. However, there are at least 3 factors that have an impact on how to successfully navigate through the complex and ever changing digital health landscape.
Today, a digital health strategy and commercial operation model need to be constantly adapted to the latest market dynamics. There is a need for ongoing interpretation of market trends, competitors moves and a need for a quick transformation of models, strategies to be successful. The pandemic has proved that even Pharmaceuticals with hundred years of existence can face a challenge and if they do not adapt to digital their business model is at risk. It is vital to have accurate and relevant real time data with some expert in-depth analysis to navigate through this fascinating and uncertain digital health landscape.
During this year’s Frontiers Health, October 20-21, 2022, in Milan and online, R2G alongside Healthware Group and a number of digital health thought leaders will lead the panel discussion on “Building successful digital health strategies in uncertain and dynamic markets”. Join us for some valuable insights, practical know-how and engaging discussions.