Even before the pandemic, innovation in healthcare through sustainable integrated healthcare systems was on the agenda of many companies in this space. Now the adoption of digital healthcare applications and infrastructures reaches an unprecedented level, the pandemic acting as a catalyzer. From streamlining physicians’ work to optimizing systems, improving patient outcomes, reducing human error, or lowering costs, digital applications are required more than ever. The overwhelming need for pandemic-related assessments and pathways has led to disruption in the priorities across the digital healthcare sector. The rapid shift to telehealth to retain business, pandemic-focused initiatives, and updated policies to accommodate remote care needs implied a lot of effort but has also uncovered challenges that can be exploited by tech companies.
The WHO Global Strategy on Digital Health 2020-2025 makes it clear that the following years will be about accelerating the development and adoption of appropriate, accessible, affordable, scalable, and sustainable person-centric digital health solutions to achieve innovation in healthcare. In or out of the pandemic context, developing infrastructure and applications that enable countries to use health data to promote health and wellbeing will bring new opportunities for market players and more discussions among regulators to ensure a level playing field for all market players.
Globally, 2020 was the year of records in digital healthcare. It was the year of companies developing medical devices that aid in the diagnosis, cure, mitigation, treatment, monitoring, or prevention of diseases. According to CB Insights, global digital health funding jumped by 45% YoY and hit a new record: a total of USD 80.6 bln in equity funding was raised across over 5.500 deals. North America, Asia, and Europe all saw a boost in funding year-over-year (YoY). There were 187 healthcare mega-rounds (over USD 100 mln) last year, a new record. Moreover, global telehealth startups raised an unprecedented USD 3.3 bln in the last quarter of 2020.
As we see in other sectors, big tech companies have been very active in meeting their huge customer base’s needs. Apple Fitness, Microsoft Cloud for Healthcare, Google Health Studies, Google Cloud’s Healthcare Interoperability Readiness Program and 2 AI tools to analyze unstructured medical text, Amazon Pharmacy and Amazon HealthLake are some of the most notable developments in digital healthcare we’ve recently witnessed from the big tech companies.
Multiple subsectors in healthcare are definitely thriving and prone to even more disruption and innovation. To succeed in digital transformation in healthcare, as it is in other industries, the whole of the company needs to be involved. As Leslie P. Willcocks points out in a recent article in Forbes, generally speaking, companies usually fail in their digital transformation journey due to their “siloed’ approach, a barrier to change that is usually inherited from older business models. Moreover, slow adoption of emerging technologies may reduce risk in the short term, but it leads to growing business risk and diminished competitiveness in the long term. Being aware of the technologies and market trends that are gaining a higher profile in business plans lately is the first step in overcoming the complexity of organizational change and truly ensure digital transformation.
Digital healthcare – essential trends to watch and thriving market segments
Studies suggest an unprecedented upswing in the use of telehealth technologies, the sector expecting even more growth as patients realize the convenience of the telehealth services. Frost & Sullivan forecasts a sevenfold growth in telehealth by 2025, a five-year compound annual growth rate of 38.2%. Currently, social distancing among physicians and patients will drive unprecedented demand for telehealth. This will imply more room for innovation in communication systems and networks to enable sessions between the patient and provider, or in data gathering and transmission.
Despite the uptake and the visible benefits for multiple parties involved, there are also restraints, mainly related to security, in part due to rapid telehealth rollouts and relaxation of firewall rules to accommodate additional remote-work capabilities. Any time a change to an IT environment is implied, there is a potential risk. Moreover, there will always be cybercriminals looking to exploit tech vulnerabilities. Cyberattacks targeting healthcare organizations have been on a steady uptick over recent years: 32 mln patient records were breached between January and June 2019, according to the Protenus Breach Barometer, double the number registered in 2018. Microsoft also warned about the use of ransomware, including using Java Runtime Environment, to target health systems. Any outdated software that exists in the delivery of a digital healthcare service could pose new and unexpected threats.
Artificial intelligence, Virtual Reality, and wearable devices
AI-powered programs help in analyzing thousands of pathology information related to various diseases to provide highly accurate diagnoses and predict the best possible drug combinations. The healthcare AI-powered tools market is expected to exceed USD 34 bln by 2025, which means this technology has the potential to impact a wide range of subsectors in the healthcare space.
AR & VR, with their wide range of applications, present a huge potential for streamlining patient engagement and treatment. The global virtual and augmented reality in the healthcare market is expected to reach USD 5.1 bln by 2025. From pain relief to treating bipolar disorder, PTSD treatments, pre-operative anxiety relief, or even surgeries, VR has the potential to greatly impact not only the entertainment and gaming industry, as we’ve been used to so far, but also healthcare.
Another trend related to digital transformation in healthcare comes from collecting health data from medical devices. Among other means through which data is collected, companies are heavily investing in wearable technology devices that can provide up-to-date monitoring of certain types of patients, especially the high-risk ones, to predict major issues. According to a recent report, the global wearable healthcare devices market is projected to reach USD 46.6 bln by 2025 from USD 18.4 bln in 2020, at a CAGR of 20.5% from 2020 to 2025.
The problem of fragmented medical reports and the lack of interoperability between systems that should make patient data or stuff data available to other organizations and to the patients themselves are two issues that can be addressed by using blockchain technology. According to a recent report, blockchain in the healthcare market is expected to reach USD 890.5 million by 2023, with an increasing number of companies realizing the true potential of this technology, that of ensuring transparency and accessibility in the entire ecosystem.
The digital healthcare space is currently prone to more disruption and innovation as the need to create strong, sustainable infrastructures and systems that would allow for more efficient use of hospital space, staff, technology, and other resources is more stringent than ever. Companies that are aware of the emerging technologies that are worth investing in – or at least exploring – are the ones that will reap the benefits even in uncertain times. The pandemic has brought many opportunities in certain areas of the digital healthcare space that can be exploited to ensure high-level healthcare services. There is still a lot of work to be done, especially for companies that embarked on the mission to streamline operations, ensure organizational resilience, and become competitive digital businesses and bring new innovation in healthcare.
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About Ana Păstrăvanu
Ana is a marketing specialist at Maxcode, with a focus on writing and shaping quality content related to the industries our company is active in. Her experience as an editor and researcher on financial developments has helped her better understand the market and develop her passion to follow new trends and analyze them in order to provide relevant and actionable insights.