The Changes, Initiatives and Questions Driving Healthcare Markets

In a previous blog “Which way to go in tomorrow’s MedTech markets“, we described how different forces are placing the national healthcare systems and the MedTech and pharmaceutical industries under substantial pressure.
In this second blog of this series, we offer further insights into our exploration of the healthcare market and our answers to the challenges ahead in the shift from pure product manufacturing to a full healthcare service offer.

Forces driving healthcare sectors

  • The number of patients continues to increase (aging population, increase of chronic patients).
  • Governmental cost reduction programs and privatisation of healthcare insurance put pressure on hospital operations and inflate the non-clinical costs.
  • In emerging economies there is a continuous effort to make healthcare accessible to a larger part of the population.
  • The patient acquires a bigger role in the clinical decision making.

The increasing gravity of these pressures causes a kind of Big Bang effect in the healthcare (HC) environment, leading to reforms, changes and initiatives going very different directions, for all stakeholders.

  • New concepts which assist care providers to decrease their cost of operations, such as:
    • Value-based healthcare
    • Reduced (or increased) outsourcing of clinical and non-clinical services, etc.
  • HC policy makers seeking to contain or reduce costs through:
    • More privatization; HC insurance and provision
    • Through less privatization; e.g. the creation of reference centres that provide services to other hospitals)
    • Implementation of e-health
  • Patients become better informed and better organized
  • The MedTech and pharma industry look for new ways to deal with this changing universe and seek alternatives in different directions.

Questions that are raised after the Big Bang in healthcare environments

Questions that are raised after the Big Bang in healthcare environments
Questions that are raised after the Big Bang in healthcare environments

Diagram 1. Explores the various questions that are raised amongst care suppliers and providers, in regards to the considerations and investigations that have to be made in order to respond intelligently and effectively to the market forces that are directing the development and evolution of healthcare markets. What will generate the required level of competitiveness and sustainable differentiation. Where does it stop to be a cursory improvement and when does it start making a difference? Who are the stakeholders, and do we have the organization and/or sales force to reach them? Are the benefit holders also the budget holders, and how fast will the market adopt the new solution?

Answers to healthcare challenges

In 2015 and 2016, TforG had the opportunity to explore 17 different potential solutions, of very different natures, to assist MedTech companies in selecting their future business orbit. Overall we can categorize these into the following groups:

Answers to healthcare challenges

  1. Technology/product oriented services

Innovative technologies are replacing existing methods and devices, for example in the field of diagnostics etc., and as demonstrated in the popular switch to minimally invasive techniques. Please have a look at our blog on Minimally Invasive Surgery, exploring the market trends and opportunities that this technique brings with it.

Products are being designed that allow the exploration of new clinical pathways, changing the possibilities and direction of existing protocols. This can be witnessed in product-oriented developments in high-end specialty fields such as spinal and other surgical interventions, amongst others.

Not only are the technologies sold, but also entire servicing packages and auxiliary services that are required to perform a given procedure, and or to employ a given product in the most effective manner.

  1. Hospital/clinic oriented services

From the hospital perspective and those managing clinical processes, evolutions are occurring in regards to purchasing and inventory management, risk management, and infection control.

1-stop-shopping is growing more common, i.e. using product suppliers who can handle all the supply needs of a given medical facility, or all the equipment and auxiliary product needs of a given treatment or procedure that the facility offers.

Particularly this last aspect –of acquiring supplies as packages for an entire procedure – demonstrates a shift from mere product sales to more service-focussed markets. Rather than selling the individual components needed for the procedure, all peripheral equipment and needs are also being offered by the same supplier/brand; i.e. a complete solution is offered, from C-arm to technical on-site support.

Services that optimize the acquisition and or use of products, in terms of supply chain strategy, inventory administration, and outsourcing are also on the rise.

  1. Care provider oriented services

A solid and pressing market driver is the need to reduce or re-allocate workloads and tasks to more financially sustainable and cheaper approaches, such as tele-monitoring and home services/aids. Furthermore, services are being introduced that reach beyond a particular brand or product, i.e. intervention packs, clinical workflow analysis, staff planning, and spaces for the exchange of information within broader care provider networks.

Support systems in the shape of application support, workgroups and information platforms are sustainable (economically and ecologically) in maximizing and adding value to an existing product/brand. Application assistance solutions generate additional value through new, complimentary and smart services, rather than resorting to issuing new and competing physical products.

  1. Patient oriented services

In a market where patients are the ultimate consumer, and these patients are continuously better informed and more demanding for quality, accountability, and transparency, a strong medtech and service driver is the focus on improving the patient experience.

This refers to reducing hospital stay, e-health solutions, increasing safety (including tele-monitoring to boost follow-ups), and strengthening the independence of the patient. Patient oriented consultations and smartphone applications to boost the compliance to medication and to provide guidance in appropriate healthcare is also highly valued, improving healthcare outcomes, and lessening the pressure on practitioners and hospitals.

The market is showing more and more totally integrated solutions and provisions of clinical care, addressing specific niches. Such include specialized clinics, tailored nutrition plans, diabetes care, dialysis, etc.

The shift from products to services

Interesting to note: the switch to more all-encompassing product packages that include core and auxiliary services, requires a different approach to sales and marketing, as these impact a larger realm of clinical and non-clinical stakeholders. Particularly non-clinical stakeholders are being targeted more frequently, as these often manage a larger chunk of the overall budgets disposable (for multiple different departments and facility operations) and must manage the costs incurred for the facility as a whole in order to financially and qualitatively sustain their care offers.

Certain market players/medtech companies are finding (and winning) new market shares by building on their service portfolio completely separate from their traditional/existing product ranges. This allows a purer and clearer focus on maximizing the effectiveness of the service as a whole and in itself, rather than designing service-solutions with the underlying intention of eventually selling more existing products.

Solution oriented TforG services

TforG offers analytical, statistical and consultative services to fully explore the market opportunities, product needs and procedural characteristics of any given medical intervention and process. TforG services include:

the myToolsforGrowth platform

The myToolsforGrowth BI platform provides key insights into national healthcare markets, from macroeconomic data to highly specific data reflecting the exact number of procedures performed in 13 medical specialisms (referred to as Surgical Procedures Volumes; free trials are available to explore this application via the TforG website).

Decision support – tailored market research investigations

Customized investigations into any given market of interest to the customer, to identify drivers and needs of clinical processes and medical procedures. A close collaboration with project managers allows you to design a precise outcome-driven research project to tackle all your queries in order to maximize your medtech market strategy.

Care tracks

Clinical workflows and patient care tracks allow you to trace the exact steps that a patient undergoes throughout a given ailment and successive treatment in various national markets and medical specialisms. Knowing exactly what and which type of doctor and or care-intervention is involved, where it is performed (in or out of hospital settings), and being able to identify weaknesses and opportunities within a care protocol/approach, allows a solution/product supplier to optimize their customer approach, in order to offer genuine added-value.

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About Bart Van den Mooter

Bart is the founder of TforG and works closely together with over 50 global companies such as Abbott, Baxter, GE, J&J, Medtronic, Philips, Stryker and Covidien. In this function, he spends a lot time with Key Opinion Leaders and Health Policy makers in Europe and in Emerging Markets. He graduated at the Polytechnic University of Leuven with a Master of Engineering and has an MBA (Flanders Business School).