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Circularity enters healthcare

by Sven Jungmann

Photo by Myriam Zilles on Unsplash

In healthcare as anywhere else, we should design out waste and use less of the world’s finite raw materials.

In 2012, a French medical device engineer was tasked with expanding his company’s sales of single-use tools in Latin America. The company had high hopes for their sales figures, after all, the single-use tools were designed to be used once and discarded. But despite his best efforts, sales figures were drastically lower in this new market compared to Europe.

At the time, I was in Brazil for an exchange program during my final year of medical school. I became friends with the engineer, who shared the problem his company faced: Brazilian hospitals didn’t buy into the consume-and-discard model that was so prevalent elsewhere.

The issue, as it turned out, was embedded in language. The Portugese word for single use — descartavel — includes the prefix des, or ten. He explained that the Brazilian view on single use items was that they can be used at least ten times.

It sounded like a great dinner joke on cultural differences. But really it was a lesson in how make-consume-dispose culture is something we invented — and something we can actively choose not to do.

Moving Away from Single-Use

Back in Europe, Philips was pioneering a new way of selling light. Traditionally, Philips made money by selling its customers lightbulbs, including to the Amsterdam Schiphol Airport. Every time a bulb failed, the airport had to order a new one, and Philips made a profit. It was a good model for Philips — all the company had to do was make lightbulbs that were slightly better and longer-lasting than its competitors. But they didn’t have much of an incentive to make significantly better light bulbs; long-lasting light bulbs would mean the airport ordered fewer bulbs and that would cut into Philip’s profits.

While this model may have been good for profits, it wasn’t good for innovation. And it wasn’t sustainable for the planet.

Luckily, Amsterdam’s airport doesn’t buy light bulbs any more — they buy lighting-as-a-service. Philips provides light, but the airport doesn’t buy the actual bulbs. When a light bulb fails, Philips replaces it. This incentivizes the company to make better, longer-lasting products.

But would that work in healthcare? Would it be safe?

Can circularity work in healthcare?

Is healthcare a special industry? Or were the Brazilian hospitals — the ones that re-used items — onto something?

The conventional wisdom has been that reusing tools was a threat to both patient and healthcare provider safety. Discarding items was seen as a way to prevent the spread of dangerous germs.

Of course, not all items were used once and thrown away. Surgical equipment is sterilised. But rather than figuring out a method to safely clean and reuse items, many healthcare items — like personal protective equipment — were seen as cheaper to discard.

And then Covid happened.

Our single-use system was exposed as broken. Hospitals and governments quickly ran out of personal protective equipment and testing kits. Italian doctors wore diving masks, Spanish medics taped bin bags around their necks in a sad effort to limit their risk of infection.

But during this time of fear and chaos, we saw innovation.

When there weren’t enough single-use masks, researchers looked at what would happen to their filtering capacity if they were sterilized. They found that, after sterilization, you can safely reuse these items several times although they were designed to be thrown away almost immediately.

The drive for circularity in the healthcare system was born out of necessity — a crisis that exposed the weaknesses in our current system. The move towards sustainable systems is about the ability to deliver the right care for patients while protecting healthcare workers even in times of duress and scarcity.

But healthcare isn’t like lights, you might say. Things become more complicated when it comes to our health. But already, major healthcare companies are looking to switch from selling a tool — like a scalpel, forcepses, and other parts of operating sets — to providing the service of that tool instead. And for those companies who aren’t moving on this yet, they might soon: lawmakers are looking to push large organizations to include sustainability targets into their supply chains.

But we need the healthcare system to go farther. As we move from responding from the current crisis to evaluating the longer-term healthcare solutions, we must incorporate environmental concerns.

As we discuss in our book FightBack Now, the movement towards circularity would allow the entire healthcare industry to contribute significantly to Sustainable Development Goals.

In fact, healthcare itself, as it is currently delivered, is a substantial part of the climate change problem. It is responsible for 4.6% of global emissions and that figure is rising steadily.

The biggest contributors of all are fairly predictable –

  • electricity and heating (30%)
  • transport (15%)
  • manufacturing and construction (14%)
  • agriculture (11%)

Beyond single-use items, there are other ways to incorporate a circularity mindset into healthcare. Hospitals use a lot of energy, create a lot of waste, and generate unnecessary trips that could be avoided if we moved to a more decentralized delivery system.

These aren’t new discoveries. But we have finally achieved a critical mass of stakeholders who understand that the future of healthcare must look different from its past.

We should shift away from planned obsolescence and produce repairable goods, so that products are not thrown away the moment something goes wrong.

And we should rethink our consumption models so that manufacturers have cash incentives to make long-lasting, efficient products.

It’s an exciting time for innovators, especially when it comes to healthcare.

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FoundersLane, the leading Corporate Venture Builder for climate and health, was founded in 2016 by Felix Staeritz, Andreas von Oettingen, and Michael Stephanblome. The team develops digital business models in the health and climate sector by combining the agility and the mindset of technology entrepreneurs with the strength of corporations. FoundersLane draws on more than 20 years of experience by the founders in building up new companies.

FoundersLane creates new, fast-growing digital companies in categories that are highly topical and current. FoundersLane counts more than 100 founders, experts and entrepreneurs with great expertise in the fields of medicine, health, climate, disruptive technologies such as IoT connectivity, AI, and machine learning. Clients and partners include SMEs and corporations as well as more than 30 Forbes listed companies, such as Trumpf, Vattenfall, Henkel and Baloise. FoundersLane is active in Europe, MENA and Asia with offices in Berlin, Cologne, Vienna and London.

Dr Sven Jungmann is a doctor-turned-entrepreneur. He is a partner at FoundersLane and an advisor to health start-ups and investors. Handelsblatt listed him among Germany’s smartest innovators. Sven consults Wellster Healthtech, the D2C health success case in Germany and continues doing so via an advisory board role.

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FoundersLane

Independent corporate company builder, co-creating digital businesses together with leading global corporations.