Future roles of medtech in the new marketplace

COVID-19 has sparked an unprecedented crisis across the globe but if there is a silver lining, it is that the pandemic has inadvertently triggered a newfound appreciation of the healthcare sector's contributions, as well as a new era of innovative health care solutions augmented by consumer technology and other digital health disruptors.

In South-east Asia, for example, we have observed the rise of telehealth applications as health-conscious consumers sought out these digital services amid the scarcity of healthcare resources.

Even in developed markets such as Singapore where scarcity is less of an issue, use cases for telehealth applications also rapidly expanded to conduct checks on arriving passengers at customs checkpoints and monitor the health status of individuals isolating in designated facilities.

Apart from dealing with the immediate aftermath of the pandemic, South-east Asia's medtech sector is also shifting its focus towards longer-term growth priorities in areas uncovered or accelerated by Covid-19.

In Singapore, for instance, the Emerging Stronger Taskforce is looking into how medtech capabilities developed during the pandemic in areas such as in-vitro diagnostics can be deployed beyond infectious diseases, to areas such as oncology and cardiovascular diseases.

These trends suggest that in the not-too-distant future, South-east Asia's medtech sector is likely to be defined by several characteristics: increased digitalisation and consumer-centricity; a more palpable shift towards prevention; and the emergence of new healthcare collaborations and partnerships.

SIX FUTURE ROLES

As changing consumer health needs and increasing collaboration with consumer technology companies drive solutions that go beyond the device, the medtech sector must evolve away from its current product-centric roles and towards new models that will better position them to create sustainable clinical and business value.

Specifically, we envision six future roles of medtech in tomorrow's healthcare marketplace:

Next-generation commodities supplier

As a pivot from the product supplier role that most medtechs currently perform, a next-gen commodities supplier provides clinically sound products at much lower prices. Similar to generics pharmaceutical manufacturers, the role takes advantage of sustainable cost advantages to achieve an industry-leading cost-of-goods-sold profile.

Best-in-class innovator

Although still a product supplier, a best-in-class innovator adds value by providing products with substantial clinical and economic differentiation, such as devices that cure specific diseases, slow disease progression, or enable more personalised treatment. Their competitive advantage lies in an agile ability to produce first-of-its-kind solutions.

'Medical-solutions-as-a-service' provider

To elevate itself from a product supplier to a customer business partner, a "medical-solutions-as-a-service" provider leverages the data-driven delivery of holistic solutions, including hardware, software, and professional services. Similar to how the technology industry evolved from selling products to delivering solutions, medtechs that adopt this role will need to embrace outcome-based and subscription-based models.

Disease owner

A medtech that "owns" a disease provides superior care coordination and acts as a one-stop shop, covering devices, digital tools, services, and even drugs to treat or manage a specific disease. Such roles are likely to be more effective in the management of chronic diseases that cut across the entire care continuum.

Ecosystem data and informatics provider

With data becoming the new gold, an ecosystem data and informatics provider role may emerge to aggregate, curate, and analyse data from various sources to generate insights for providers. As health information technology (IT) and consumer technology giants may already have a competitive edge to win in this role, medtechs interested in this role will need to dramatically transform their capabilities, and leverage collaborations with consumer technology leaders.

Consumer health enabler

With healthcare transitioning to a prevention model, the consumer health enabler empowers consumers to proactively manage their own health, by collecting and analysing data from diagnostic devices, and generating consumer-friendly insights. To succeed in this role, medtechs will need to shift away from a provider-centric model to a consumer-centric one, and develop capabilities to engage a broad consumer base.

ADVANCING TO NEW ROLES

Of the six future roles, the first two - next-gen commodities supplier, and best-in-class innovator - are already embedded in many medtechs' current operations. Examples of the other four roles are emerging and we expect these roles to grow in importance as time goes on. The key question then is: how do conventional medtechs advance their journey to this future of health?

As an immediate first step, we suggest that medtechs evaluate their business and product portfolio capabilities and map them to each future role's value proposition to identify an appropriate role. They should then identify capability gaps that may prevent them from realising the benefits of the desired role and, finally, close these gaps through a build, buy, and partner strategy.

Ultimately, what might help enable medtechs to transform care delivery and set them apart from competitors - both market incumbents and disruptive entrants - will be their ability to harness data gathered by their devices and use it to improve well-being, anticipate health issues, and help consumers change the day-to-day behaviours that affect their health.

Our view is that medtechs will be better able to do this by collaborating with consumer technology leaders and specialised digital health companies, rather than going it alone.

Consumer technology companies, in particular, typically have access to large caches of consumer-generated data - that is, non-health data that could lead to health insights - in addition to efficient distribution channels, an embedded culture of innovation, and sophisticated data analytics capabilities that can buttress a medtech's diagnostic and monitoring platforms.

The time to act is now. Medtechs of the future will operate in a much more dramatically altered healthcare landscape, where the expected revenue pool for the traditional medtech role as product suppliers will continue to shrink as the value it delivers decreases and new roles evolve.

As medtechs plan their migration strategy, some may decide to focus on excelling in a single role, while others may choose to leverage new technologies to take on several.

In either case, they should quickly assess their current offerings, customers, and unique capabilities - or risk being outmanoeuvred by competitors.

• The writer is South-east Asia life sciences & healthcare industry leader at Deloitte. The views expressed are her own.