The digital healthcare opportunity in emerging markets Across Southeast Asia, demand for healthcare is rising rapidly. The ARC Centre of Excellence in Population Ageing Research credited the acceleration to population growth, rising incomes and the increased prevalence of non-communicable diseases in its Asia in the Aging Century research. The fact is, warnings of a looming chronic disease epidemic were sounded as early as 2011 when a Lancet article highlighted that such diseases accounted for 60 per cent of deaths in Southeast Asia. Emerging markets in Asia in particular find it increasingly challenging to meet their citizens’ escalating health needs. The healthcare landscape in these countries is characterised by underdeveloped infrastructure, fiscal constraints and chronic shortages of equipment and medical professionals. For instance, according to World Health Organisation data, Southeast Asia has fewer physicians on average, at 0.6 for every 1 000 people, compared to developed economies such as Germany, which has 3.7. The ratio drops further when zeroing in on developing countries such as Indonesia (0.1). However, the digital age holds out the promise of innovative technology and business models, which are disrupting the healthcare market. The dynamics are ripe for digital healthcare solutions in Asia’s emerging markets, according to a new PwC paper The Digital Healthcare Leap.
Most critically, “Internet and smartphone penetration [is] growing, and the technology infrastructure (is) moving to cloud-based services,” says David Wijeratne, PwC’s Growth Markets Centre leader. Digital innovations can plug the healthcare gap in emerging markets, improving the quality of and access to care, while reducing costs, he adds. For example, telemedicine allows doctors to treat patients in remote areas where traditional healthcare has failed to reach. Markets need to consider such new models, as it’s unlikely they “will be able to close the healthcare gap using a traditional approach,” says Wijeratne. However, he points to three main challenges that must be overcome before we see widespread adoption of digital healthcare in emerging Southeast Asia. While connectivity is improving, most countries lack fixed broadband infrastructure to support technologies; public healthcare systems have insufficient resources to embrace innovations; and there is a dearth of cybersecurity and privacy laws. Why Singapore leads Southeast Asia in digital healthcare While developed markets such as Germany started digitising patients’ health records in the early 2000s, adoption of traditional electronic health records (EHR) remains low in emerging Southeast Asia – paper and outdated IT equipment still dominate healthcare in these markets. However, Singapore – long a nation of early adopters – stands apart in Southeast Asia. The country’s uptake of digital healthcare has been driven by a combination of factors, including the government’s promotion of IT adoption and innovation in healthcare. The Integrated Clinic Management Systems programme was launched a decade ago to improve the operations of General Practitioner (GP) clinics and better plan for patient treatments in coordination with hospitals and other healthcare providers. Just recently, the country announced it would pump in more than S$19 billion (US$13 billion) to a five-year plan for research and development, some of which will go towards innovation at the intersection of healthcare and IT.
“There are a number of (other) factors that have ensured Singapore leads digital healthcare adoption in the region as well as globally,” says Wijeratne. These include strong internet connectivity and high mobile and smartphone penetration, which are crucial for digital adoption among consumers and enterprises. Singapore has a nation-wide wireless broadband network and world-leading ultra-high-speed fibre infrastructure, which delivers connectivity direct to homes and offices. Mobile subscription penetration has also exceeded 100 per cent. Furthermore, the country has all the elements listed in PwC’s The Digital Healthcare Leap as key for a healthy digital healthcare market: seamless access to health information, data security, disruptive health startups and patient-centred digital innovations. Singapore is advancing seamless access to health information. Having rolled out a National Electronic Health Record system in 2011 that enables patient records to be shared across the healthcare system, Singapore is now moving data to the cloud. More than 40,000 healthcare workers already use H-Cloud to access medical records.
Data security has also been taken seriously. “Everything from the introduction of the Personal Data Protection Act in 2012, with specific applications to the healthcare sector in 2014, to the required local hosting of data by the Integrated Health Information Systems is testament to this,” says Dr Zubin Daruwalla, PwC Southeast Asia consulting director for healthcare. Disruptive healthcare ventures abound in Singapore’s thriving startup ecosystem, which the government has done much to nurture. The state has invested in building citizens’ entrepreneurship skills, as well as legal, patent and regulatory systems trusted by entrepreneurs and investors, says Wijeratne. These supportive measures have helped see Singapore become a leading hotbed for healthtech startups in Asia-Pacific. It’s home to 9 per cent of such startups in the region – the biggest after China and India – according to Deal Street Asia. Lastly, Singapore is pioneering patient-centred digital innovation by working closely with the private sector. Under one such partnership, Philips as joined forces with Changi General Hospital and the Eastern Health Alliance to pilot telemedicine for heart failure patients. “This innovation could help bring down re-admission rates by encouraging self-monitoring and more efficient engagement with care providers,” says David McKeering, PwC Global Healthcare Markets leader. Ivy Lai, country manager, Philips Singapore, credited Singapore’s citizens for being especially receptive to digital healthcare. “Singaporeans are among the most tech-savvy in the world, and that translates into their attitudes towards digital healthcare – it is not just the younger generation who are keen to adopt digital healthcare,” she notes.
How healthcare companies can leverage Singapore’s USPs Singapore’s geographical advantage and role as an active trade hub make it an ideal base for companies to grow in the region, says Daruwalla. These trade linkages are set to strengthen, with the further development of the ASEAN Economic Community (AEC). “Singapore has become the natural gateway for companies to understand the fragmented healthcare markets in Southeast Asia,” explains Daruwalla. “It also plays an important role as a sales and marketing gateway to the region.”
Starting a Singapore base allows companies to leverage the country’s strong fundamentals and systems and reach “tremendous growth opportunities” in nearby emerging markets, adds Lai. Having established operations in Singapore in 1951, Philips opened its new ASEAN Pacific Headquarters in 2016, which will oversee the delivery of innovative healthcare solutions across the region. “We see huge potential to form more strategic alliances with leading healthcare innovators in Singapore and the region,” says Lai. She says that stringent intellectual property (IP) laws and strong government support for innovation also make Singapore “an ideal test bed for new technologies”. Another company that is harnessing Singapore’s strengths in the healthcare space is Healint. CEO and co-founder Francois Cadiou says: “We work with Singapore hospitals to co-develop IP, which is integrated in our solutions.” He points out that companies can easily access a wealth of medical and scientific talent in Singapore to develop innovations for the region and beyond. MNCs should also capitalise on Singapore’s diverse population to build multicultural teams. “Our motto is built in Singapore for the world,” he quips. What’s next for Singapore in digital health innovation? McKeering predicts several trends will take off in Singapore, driven by a common aim: finding new ways to provide affordable, quality healthcare. This includes wider implementation and adoption of remote healthcare models. Singapore is already establishing remote care monitoring rooms, where physicians use cloud solutions to oversee patients in their homes, according to him. “Analytics and big data is another area expected to grow,” says McKeering. These technologies will allow Singapore to better understand its population’s health needs and provide targeted services. Predictive analytics would be especially valuable, enabling Singapore to identify population disease patterns and develop preventative medicine. Singapore is already in the process of building remote healthcare models with big data capabilities. A pilot of Smart Health-Assist last year saw patients monitored in their homes via sensors. In the future, data from these sensors may be collated with national health databases to unlock insights into population health. All this points to the unique value that Singapore offers health companies looking to tap Southeast Asia’s ripe digital healthcare market. As a leading digital healthcare hub, the island state is an ideal base to establish regional operations. It also stands out as a glowing example of how emerging markets can use technology to break new grounds despite healthcare infrastructure limitations. Information in this article is based on PwC’s report, The Digital Healthcare Leap, and the interview with David Wijeratne, PwC’s Growth Markets Centre Lead. Edited by Kritika Srinivasan and Goh Wei Ting