Rising health care costs, ageing populations and changing lifestyles in emerging economies are stoking demand for medical technology (medtech) solutions. These entail not just smart devices that remotely monitor and transmit biometric data, but any instance of technology that helps to deliver health services. These initiatives are happening everywhere, but there are significant differences in the speed and scale of medtech adoption across emerging markets.
UBS Investment Bank estimates that the emerging markets health sector will grow 6.3% annually over the next decade – double the speed of developed markets – as governments make up for historic underinvestment. Emerging markets routinely spend less than 10% of GDP on health care, compared to around 15% in developed nations, but are working to reduce the deficit. Ageing populations are a catalyst, and the UN estimates that by 2030, the 65-and-over demographic in emerging markets will rise to 15% of the population, up from 10%.
Concurrent with the rise in elderly patients needing care, diagnosis of non-communicable diseases (NCDs) is expected to increase. This is due to urbanisation and sedentary lifestyles accelerating the incidence of cancers, cardiovascular and chronic respiratory diseases, and diabetes. As NCDs demand longer and more expensive treatment than many other illnesses, emerging markets are investing in cost-effective medtech solutions to improve root cause analysis and patient care, while simultaneously reducing the rate of readmissions.
Digital Revolution
Digitisation is a critical first step towards achieving medtech synergies, facilitating the adoption of standard health care industry practices in order to reduce waste and improve analysis.
In many countries in Africa, however, obtaining a patient’s medical records can often be difficult. The process has inspired solutions such as the KEA Medicals digital health platform, under which 50,000 patients from six African countries currently maintain their medical information, having created Universal Medical Identity (UMI) accounts. Once signed on, each patient receives a printed QR code that embeds their UMI code, which allows doctors to scan their patients for information at the point of delivery. Some 1700 medical professionals are connected to the network.
Such innovations, while effective, are no substitute for government-led programmes to digitise medical records, otherwise known as electronic health record (EHR) systems. Mexico aims to implement EHR across its hospitals by 2020, and recently announced the activation of HarmoniMD, a cloud-based EHR system, at Fundación de Cáncer de Mama (FUCAM), a breast cancer foundation that provides specialist care services. The system is expected to improve understanding of incidence, vaccination rates and other health occurrences.
Medtech Market
US-based market research company BCC Research estimates that the global medical devices market will grow to $674.5bn in 2020, up from $521.2bn in 2017. At the same time, emerging markets are earmarked to increase their share of these revenues from less than 25% to more than one-third. This has been driven by innovations in smart technologies enabling higher rates of home care, and by a push towards multifunctional devices and holistic biomedical data, consequently lowering costs across the industry.
In practice, these devices enable projects like Khon Kaen Smart Health in Thailand, an integrated smart health initiative centred on Khon Kaen Provincial Hospital. This medtech solution incorporates a smart ambulance service that uses GPS to coordinate patient pick-up, coupled with real-time video and data transmission to prep the hospital ahead of patient delivery. It also includes a sensor platform that monitors the activity and condition, including the blood pressure and sugar levels, of elderly residents with chronic diseases, enabling them to remain at home. The data is then integrated with the patient’s EHR information.
Khon Kaen employs a multi-stakeholder approach to patient care, which is increasingly the norm amid an ongoing redefinition of the health care value chain. Traditional innovators like pharmaceuticals, hospitals and medtech giants like GE Healthcare and Medtronic are increasingly partnering with bulk buyers, including health insurers and government entities, accelerating a shift towards centralised repositories of health data. These traditional stakeholders are also vying for business with tech companies that make smart predicative analysis and monitoring tools. VC Rock Health reports that digital health companies in the US alone raised almost $6bn in 2017, and had secured a further $6.8bn by the end of the third quarter of 2018.
Risks & Challenges
The path to medtech adoption is often impeded by cultural, structural and regulatory factors. In the UAE the sector is undergoing a wave of consolidation and specialisation in reaction to over-investment in hospitals during the first half of the decade. Health care providers are focusing on their bottom line. “The health care sector in the UAE needs to develop their focus on providing value-added health care,” Majid Kaddoumi, vice-president and regional managing director, Central and Eastern Europe and MEA for Medtronic, told OBG. “For the most part, health care providers think about reducing costs, without putting any thought into the overall outcome for the patients.”
Additionally, the benefits resulting from adoption of artificial intelligence-enabled procedures are not always immediately apparent. According to David Hadley, CEO of Mediclinic Middle East in the UAE, productivity gains are currently outweighed by doctors having to maintain existing notes while also entering data into hospital systems. “Little by little, though, the amount of stored data will serve more to help doctors rather than just giving them more work. The biggest potential is expected to be in diagnostics,” Hadley told OBG.
Another challenge is that information is not currently shared as effectively, seamlessly or securely as it could be, according to Michael Schelper, CEO of Cerner in the UAE. “However, this has a solution: blockchain. This technology will allow for decentralising the ownership of data and letting individuals own their own data, which in turn will allow for it to cross borders in an efficient way,” he told OBG, cautioning that this technology is still in the early stages of development.
Middle East Reforms
The Middle East is set to experience the benefits of investment in digitisation as the introduction of mandatory insurance and e-health systems set the stage for improved patient outcomes.
UAE Vision 2021 emphasises the importance of preventative medicine in reducing cancer and lifestyle-related diseases. The government has set aside more than $500m to fund a diverse assortment of innovations in priority sectors, including health care, and has already spent $232m on funding advancement of digital care between 2014 and 2016, aiming to become a regional leader in the delivery of smart medtech. “The National Unified Medical Record Project, now renamed MyCare, is an important initiative that aims to make available individual data to all health care providers,” Schelper told OBG. “Proper data management will lead to a decrease in the cost of health care by improving preventive medicine and well-being. This, in turn, will drive down the high cost of insurance premiums.”
In Qatar the public sector is responsible for delivering the vast majority of health care services, and the country is facing a set of typical challenges. “We are experiencing an increase in the prevalence of largely preventable lifestyle diseases, among them obesity, heart disease and Type 2 diabetes,” Hanan Mohamed Al Kuwari, managing director of Hamad Medical Corporation, a non-profit health care provider, told OBG in 2018. Consequently, Qatar’s National Health Strategy 2018-22 and Public Health Strategy 2017-22 each focus largely on preventive care. The former sets a series of 2022 targets, including building a national knowledge platform that will improve access to data, enabling intelligent analysis of population health, and establishing a system of clear legal frameworks to facilitate access.
Overall, the trend of increasing specialisation in the region is considered to be driving higher quality that can potentially counter problems associated with high costs, particularly when supported by potential income from medical tourism. “Medical tourism has a huge growth potential in Dubai,” Omar Oumeish, executive director at Dubai Healthcare City Authority, told OBG, outlining a detailed plan to create a one-stop digital shop for medical tourists that will help fund ongoing high-value research and development.
It is also expected to incentivise the venture capital necessary to boost industry development. “Medical tourism is definitely a segment to be exploited and quality is the best way to do it,” Maha Aboughali, business development and marketing director of Moorfields Eye Hospital Dubai, said in a statement to OBG. “However, cost is a very big challenge because travel and accommodation costs in Dubai are very high in comparison to other medical tourism destinations.”
African Potential
In Africa a lack of basic hygiene remains the leading cause of death, going some way to indicate the depth of the challenges facing the continent’s health care sector. Nonetheless, while there continue to be substantial barriers to further development in certain areas, there are opportunities for investment in local health care, led in most cases by private provisions made to expatriate populations.
As a result of sustained investment, a commitment that was confirmed in its Finance Law for 2019, Algeria is well-placed to benefit from medtech. Legally mandated free universal health care was also implemented, which allows the Ministry of Health to support a contract for the provision of radiotherapy equipment with Varian Medical Systems, under the Anti-Cancer Plan 2015-19, according to Mourad Belkheyar, interim director-general of Varian Healthcare Algeria.
Infrastructure is already well-developed and provides national coverage, an element that is unique in Africa, according to Haissam Chraiteh, director-general of Sanofi Aventis Algeria. “Local authorities are building an ecosystem that takes into account all the dimensions related to the health sector, including production of pharmaceuticals, prevention, training, research and clinical studies [while] incentivising international partners to expand their footprint,” he told OBG. Given its high regulatory standards, Algeria has the potential to act as a regional hub for health care, but there remains a variety of obstacles, such as a notable absence of standardised data. “In the long term as e-medicine and digital transformation reshape the sector worldwide, Algeria can count on a health sector that is already strong enough to incorporate and take advantage of these new technologies,” Chraiteh told OBG.
Elsewhere, Côte d’Ivoire hosts a health care sector ready for medtech invigoration, but suffers from a lack of skilled labour, supply shortages and accessibility issues. “To cater to the new needs of patients, health care facilities will have to develop multidisciplinary care services,” Eric Djibo, president and director-general of International Polyclinic Sainte Anne-Marie, told OBG. “Specifically, existing facilities are equipping themselves with technologies relevant to the new types of diseases the country is faced with, and facilities under construction must take this change into account.”
Côte d’Ivoire enjoys universal health coverage, but the system currently only benefits a portion of the population and is limited to an identified set of essential care needs. However, there are plans to progressively expand it as the government continues to pursue reforms, such as those that entail building of several hospitals over the course of two years, which will incorporate centralised data and advanced equipment, according to Dr Meite Djoussoufou, general manager of CHU Cocody in Abidjan. However, there are some concerns regarding the obstacles preceding private sector involvement.
A report by "Oxford Business Group".