HealthTech is growing up

HealthTech is growing up. It’s been often repeated that the Covid-19 crisis response has brought “10 years of market evolution in 10 weeks”. So far, this has been mostly about the engagement layer (e.g. telehealth). Is a more profound industry-wide shift happening underneath? And if so, what will that change look like and what role will tech companies play?

One thing is sure: the growth of healthcare expenditure is unsustainable. Structural trends continue to drive healthcare costs upwards: ageing population, chronic diseases (incl obesity), and the rising costs of drug development. Digitalization has helped many other industries improve customer experience while reducing costs. Why is healthcare slow to catch on?

Payers (governments and insurers) and consumers have been tolerating slow change until now, but not anymore. Healthcare will see big macro-changes in the coming years.

Together with our friends at Dealroom and MTIP, we wrote a report to explore the next big things in health innovation and what the future of healthcare might look like.

In the report, we looked at the differences in market dynamics between the US and Europe. Europe has different rules and regulations that impact the scalability, but governments are putting incentives (DIGA in Germany, NHSX in the UK) in place that will stimulate development of a next generation of health tech companies. Many countries in Europe have a more central role for the government, so changes can have a massive impact once policies are adopted.

When we look at Health Tech, we look at the different stakeholders involved: the patient, the professional, the payer, the hospital and pharma/biotech. Each stakeholder has its own pain points (for example: how to improve the patient experience?, how to lower the admin burden?, how to pay for performance?, how to deliver consistent quality? How to develop that drug faster?) that can be addressed by technology. In the report we explore these technological solutions using the patient journey, hospital and pharma value chains and money flows in the system.

Using financing data, we mapped promising startups across these categories, with deep dives into company case-studies such as WeFox, Babylon Health, but also INKEF portfolio companies Castor and Aidence.

We hope you enjoy the report! Happy reading.