Clunky, costly, highly regulated health systems, often dominated by rent-seeking middlemen, are being shaken up by firms that target patients directly, meet them where they are—which is increasingly online—and give them more control over how to access care. Here is a summary of the article from The Economist.
“Unicorns” are competing with incumbent healthcare companies and technology giants to make people better and prevent them from getting ill in the first place. In recognition that their uninnovative consumer divisions have become a drag, Johnson & Johnson, America’s (and the world’s) most valuable pharmaceutical company, and GlaxoSmithKline, a giant British rival, are spinning them off.
After a series of abortive attempts to tiptoe into the health business—as with Google’s short-lived platform for personal health data, scrapped in 2011—the technology giants are finally finding their feet. Truepill, a six-year-old American company valued at $1.6bn, now fulfills 20,000 prescriptions a day and runs last-mile logistics for a range of consumer-facing health brands.
Now better technology and greater realism about what it can achieve are rehabilitating the field, just as the pandemic has accustomed people to the idea of home testing. Its founder, Josh Clemente, was inspired by asking a friend to smuggle such a monitor for him from Australia to confirm his hunch that he was, like one-third of Americans, pre-diabetic—the devices were available only on America prescription to people with uncontrolled diabetes.
A big reason why it has taken so long for consumer technology to disrupt health care is that the highly regulated sector does not lend itself to Silicon Valley’s “move fast and break things” credo.
One strategy is to offer “general wellness” products, which evade rigorous scrutiny, and only consult medical professionals for advisory purposes or convince potential investors that your products are backed by science.
Investors who pushed the share prices of online pill-peddlers and digital hospitals up whenever covid-19 spiked have cooled on such firms now that the coronaviral threat has receded somewhat. … The prospects of Hims & Hers, whose share price has declined by three-quarters in the past year, may have been additionally dented by Amazon’s launch in late 2020 of its e-pharmacy business.
Still, as Scott Melville of the Consumer Healthcare Products Association, a trade body, puts it, “There is no going back to the old paternalistic system where you are relying exclusively on a medical professional for your health care.”
This article from The Economist makes for good reading. The transformation to “consumer healthcare” will be evolutionary, not revolutionary. Take, for example, telehealth. Some see an environment where everyone is either emailing or talking online with their HCP. That’s not going to happen. Telehealth offers benefits for skipping routine visits, but physicians need to buy in that it won’t compromise outcomes.
Consumers using virtual visits rose from 15% to 19% from 2019 to early 2020; this jumped to 28% in April 2020. On average, 80% are likely to have another virtual visit, even post COVID-19. Most consumers are satisfied with their visits and say they will use this type of care again.
When it comes to wearable devices, their use increases and can alert wearers that there may be issues, but HCPs do not accept the data for diagnosis; they require further medical tests by reliable medical testing equipment.
Even with all these changes, the health revolution will be evolutionary. However, healthcare is ripe for disruption, and it’s only a matter of time before the Valley hits on a huge winner.