2020 Healthcare trends
The JP Morgan Healthcare conference is probably the most iconic one for the healthcare industry. Taking place in January in San Francisco, it is a 3–4 day conference traditionally focused on publicly traded companies, who get to share their plans (and respond to questions from industry leaders, the press, investors, fund managers, etc). More recently, the event has included private companies which JP Morgan believes are interesting enough (or close enough to an IPO) to present. Similarly, companies which are not entirely focused on healthcare have started to get invited (e.g. NVIDIA).
Another reason for making this a unique conference is that attendance is by invitation only.
So, how come this conference with less than 10,000 attendees attracts many more people to San Francisco in early January? This is also partly due to the dozens of satellite events taking place throughout the week; but more on those later.
JPM 2020: Highlights
While this year’s conference did not include a mega-merger (like JPM2019 featuring the merger of Bristol-Myers Squibb and Celgene), they were not entirely missing.
More specifically, Teladoc Health (a leading telemedicine company) announced its acquisition of InTouch Health (a provider of telehealth solutions). This was probably driven by the natural evolution towards integration, and aims to position Teladoc as an integrated service provider — but also help differentiate itself from its competition. The acquisition will cost $600M, while InTouch Health had $80M in revenue in 2019 (up 35% compared to 2018).
Beyond this, and shifting the focus to pharmaceutical and biotech companies, their R&D pipelines remained the central theme, with cancer taking the lion’s share in most cases. The relative abundance of funding and the many unmet needs has led to increasing numbers of biotech companies with up to a handful of drug candidates; still, the fundamental economics, processes and value chain have not changed dramatically. However, the pressure on access and prices is increasing, especially given the macroeconomics, and particularly in the US.
When it comes to delivering care and drugs to patients, the race is on. CVS (the large pharmacy chain) for example, which had merged with Aetna (the insurance company), announced that they offer cheap medications to Aetna members, leveraging the scope of their integration. Moreover, they aim to have 1500 “HealthHubs” by the end of 2021, where healthcare professionals will serve customers, akin to a clinic. All this, while the direct competition with Amazon’s Pillpack (acquired for $750m in mid-2018) is now peppered with at least one lawsuit.
JPM and Digital Health
When the US government’s administrator for Medicare and Medicaid highlights the importance of digital health and technological innovation, it is a sign of maturity. However, this sparked a broad debate about definitions, applicability, evidence, uptake, and hype of digital health — making some wonder whether it is mature enough for prime time. The big picture, however, shows that the direction is following the lead of companies like Google, Novartis, Salesforce, Roche, Kaiser Permanente, and countless others. There are plenty of elements missing or not entirely there, though: evidence, patient engagement, clarity of privacy and security, and integration with the “back end” of healthcare.
Many attendees, however, tried to see the big picture; while acknowledging that it is a driving force for positive change and transformation, their view was that digital health, e-health, m-health, and the like, should just be considered part of Health and Healthcare. Some blamed technologists from trying to force their innovations into healthcare, while others accused the incumbents of slowing down progress.
In this time of transition, though, they all seemed to agree that entrepreneurs should focus on impact that is sustainable and measurable, and not on the technology that brings it.
Satellite events
The city of San Francisco, already bustling with entrepreneurial spirit, becomes a hive for exciting and interesting events, day conferences, or series of thematic forums. Here are some:
● China Focus: the latest innovations and investment opportunities from China, by China, or for China. The number and size of Chinese biopharma companies is impressive; given the access to cheaper resources, their R&D activities move relatively fast (also aided by the local regulators’ approach) and in some cases they have strong results. However, concerns and challenges around intellectual property and other important aspects remain.
● BCG events on Digital & Analytics and Value Creation. The patient in healthcare is still under-represented, but patient analytics and data are becoming the central piece of an increasing number of strategies and business models. This is where patient engagement shines through multiple touchpoints. Regarding Value Creation, technology is playing a critical role; from medical devices to wearables to Artificial Intelligence, enhancements can touch patients, clinicians, manufacturers and regulators.
● McDermott & EY: Digital Health Pioneers Forum & Life Sciences Investment Forum: It is no wonder that professional services firms are focusing so much on Digital Health and investments. Clearly, privacy is a fundamental element when it comes to Digital Health adoption. Moreover, in a time of abundance of funding opportunities (but limited time), complexities in planning & execution seem to be important showstoppers.
Other events of note include:
● Startup Health
● Israel’s Next Gen Health gathering
● UC Davis’ Biotech innovation showcase
● Button’s showcase night
● WuXi NextCode’s half-day conference
● GenScript Biotech conference.
What does this mean for you?
If you are in the healthcare space, it is important to have the JPM conference and its satellite events on your radar, at the very least. This is where interests get aligned, policies are being crafted, and partnerships begin to take shape.
Perhaps most importantly, though, it is critical to keep in mind that healthcare is essentially an ecosystem of verticals, and an industry with enormous complexity. Events like those taking place in San Francisco in early January are a great showcase for this, but you still need to keep your eye on the ball in order to have an impact.
Of course, if you are an early stage startup company that has recently entered the field, it is important to keep things in perspective and remember that pockets of innovation and untapped opportunities exist almost everywhere in healthcare, and well beyond the headlines and events. Making a difference by employing the right technology, go-to-market approach and business model is a big challenge — but can be an extremely rewarding one.
About Thanos Kosmidis
Thanos is a health technology entrepreneur with 20 years of experience in the US and Europe, and is the cofounder & CEO of CareAcross, a digital health company focusing on cancer. Thanos serves as an advisor to Velocity.Partners, an early stage venture capital fund, assisting in identifying, evaluating and supporting companies that strive for impact.
About Velocity.Partners
Velocity.Partners is an industry agnostic Venture Capital fund. Our mission is to fuel Greek entrepreneurs around the globe build world-class technology companies.
We invest in pre-Seed & Seed stages, typically up to €500K, and follow up next rounds, helping our companies build their team, prove product-market fit, gain market traction and get ready for big-league VCs along the way.
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