COVID-19 pandemic caused an exponential rush of patients to hospitals and health camps set up in hotels and schools. It then reached to a critical stage which rattled the healthcare systems of various nations across the globe. However, the crisis has provided us an opportunity to opt for ingenuity and innovation resulting in better healthcare systems.
Indian start-ups then closely worked with central, state, and district governments to support the healthcare infrastructure and to strengthen disease monitoring systems with innovations enabled with technology. From COVID-19 trackers to cheap ventilator designs, startups in India utilised medical technology to lessen problems posed by the pandemic.
For instance, the invention of Emergency Use Authorization (EUA) for the fastest ever molecular testing of COVID-19 by Abbott Laboratories is a remarkable milestone in the healthcare space. Many such developments and innovations have paved the way for a technologically advanced healthcare space which in future will change of how we perceive healthcare in India.
Another example is the use of online consultation rather than visiting the doctors in person, and the procurement of medicines online rather than visiting a chemist. These small changes have led to a paradigm shift in the healthcare space, opening a plethora of opportunities for startups.
Dr. Kanav Kahol, CEO of DIVOC Health tells that there has been a massive growth of healthcare ecosystem in India due to the coronavirus outbreak. He says, “Interestingly in India, the healthcare sector has always been two generations behind. So, whenever innovations happen, we had to wait for years to adopt them such as a new method of transplant.”
He adds further, “However, COVID-19 has changed the landscape. With the outbreak of virus, we are seeing a massive increase in the uptake of innovations. Thus, regulatory agencies have become accepting. They are giving approvals easily for testing products out and their implementation.”
According to him, one of the positive aspects of the current crisis is that startup ecosystem in this field is getting recognition. He claims, “They are getting recognition and growth which we all look for in terms of people using those platforms. The other thing is that a lot of apprehensions about using new tools are fading away.”
As responses of these start-ups are often translated in the form of digital innovations, it can be said that future of healthcare is more digital. According to an estimation, digital health market is poised to reach $504.4 billion growing at a CAGR of 29.6 per cent.
Role of consumer trends in emergence of health-tech startups
The widespread impact of pandemic has brought into focus a clearer vision for the future of healthcare. It now appears that consumer trends in this arena will be based on how consumers will engage with medical practitioners. Currently, the future of healthcare seems to be deeply associated with technology due to the impact of changes forced on consumers by pandemic.
The Deloitte 2020 Survey of US Health Care Consumers reveals that consumers now warmly welcome the idea of digital healthcare with help of these startups. The top trends of the survey show that more people are using virtual visitation tools. It also states that, 80 per cent are likely to undergo a next virtual visit, even during post COVID-era.
Furthermore, most consumers are satisfied with their visits and say they want to undergo this type of visit again. Along with this, people are now using tools to get information on costs and health issues. They are closely tracking their health conditions and using that data to make decisions.
The most significant trends that have become prominent are tele-health; virtual consultations; online commerce; online diagonstics services; robotics, usage of AI, machine learning and big data tracking to lessen the impact of challenges induced due to pandemic.
As per Practo Health insights, their e-consult platform for pediatrics, gynecology and mental health queries is witnessing huge profits. The figures registered for these specialty medicine departments are 350, 250 and 200 per cent respectively since March.
On the other hand, there are over 50 e-pharmacy startups in India with some notable names such as 1mg, netmeds, MediBuddy, PharmEasy etc. According to a FICCI research report, they were serving around 3.5 million households before the outbreak of pandemic. During lockdown, their traffic rose with 2.5X growth to 8.8 million households.
New players also registering healthy growth
Overall, not only established ones but startups launched amidst the crisis are registering huge revenues. SME Futures spoke to some of them and gained more insights about their growth. One such newcomer is 750ad Healthcare, an online platform which brings reviews of all major healthcare and social care establishments by consumers.
Applying technology as an enabler, 750AD provides credible information and connects supportive communities along with bringing deep insights about health subjects across all phases of life. Founder Shabnum Khan says, “The goal is to provide each citizen with the basic right of healthy living through authentic information.”
Secondly, the brand aims at developing a strong network of vendors and work as a healthcare market aggregator to boost the SMBs. “It is a platform for customers to buy affordable medical necessities all the way contributing to our Prime Minister’s vision of Support Local,” she adds.
According to Khan, they had to devise their strategies and create policies around the COVID-19 since platform was launched during the outbreak of coronavirus. To generate traction and create awareness for the platform, they ran campaigns such as Thankyoudoctors, Health is True Independence, Thankyounurses, HospitalReviewProgram etc.
She further informs, “One of the most unique programs run by us is Hospital Review Program, through which we provide authentic health information. You can ease your search for the best hospital that suites your medical requirements through this program.”
The pandemic has offered many challenges like economic slowdown, minimal social contact which made it very difficult for them to conduct surveys, official launch event, or any other promotional activity which involved stepping outside their offices. But, this gave them an opportunity to gain users on their website and engage with their audience socially.
GraphMyHealth – A PolicyBazaar of healthcare services
Another recent addition among healthcare platform is GraphMyHealth, an aggregator app of healthcare providers and going forward to be a one-stop solution for all healthcare-related services in all traditions. The Hyderabad based platform is being promoted by SanHar ABS, a tech-solution provider to hospitals and end-users.
Vinayak Venkatesh, COO, GraphMyHealth tells that the app is getting good response since its launch within few weeks. He says, “We have been getting a great response, though it has been just few weeks. There is a surge in requests for online consultations, dietary guidance, psychiatry counselling and an increase in registering of home-based covid-19 packages.”
Still early to talk about revenue and growth, he informs about the vision of platform in coming future. He says, “GraphMyHealth app will be like policybazaar of healthcare apps and a one stop solution for all healthcare needs.”
Service offered on this platform will include doctor consultations, home-based diagnostics and pharma delivery, treatment estimates from hospitals, and wearable integration. It will also include home-based services such as nursing, physiotherapy, diet, medical equipment hire etc.
“Besides that, it will provide services for health insurance, blood bank request, ambulance request etc. You will be able to compare the services just like you do for other services or products. Search parameters on the app will include consultant search, specialty search and AI based chatbot suggestion based on symptoms,” he adds.
Artificial intelligence in labs
After doctors and medicines, diagnostics is another important part of healthcare. At the time when coronavirus cases are increasing every day, DIVOC Health, a brainchild of Dr. Kahol has launched an AI based technologically advanced and DIVOC Laboratories in New Delhi.
Through the new-age labs of future, it facilitates patients to get a lab at the comfort of their homes. With at-home instant diagnostics, this lab allows phlebotomists to conduct testing and deliver results in a short period of time.
“The idea is to make the ‘lab of the future’ by using AI as a monitoring tool. Lot of people don’t realise that lab technicians are overwhelmed currently. They are working tirelessly and examining lakhs of samples in a day. In such conditions, mistakes can occur. Implementing technologies such AI will ease the lengthy testing process,” Dr Kahol explains.
The ‘lab of the future’ has collaborated with United Kingdom laboratories to bring 21st century innovations into diagnostics. With faster results i.e within 20 minutes at home, DIVOC is also empowering and enabling the overall telemedicine segment in India.
Dr Kahol further says, “The lab is now just a month old, but the idea behind was very simple to use AI for test processes. The traditional labs are still working conventionally, but we feel by using artificial intelligence lab processes can be improved by 360 degree. We are also trying to bring the lab to your homes by instant diagnostic setup.”
DIVOC Laboratories offer more than 500 tests which include clinical chemistry, clinical microbiology, hematology, serology, clinical microscopy, cytopathology, and molecular biology. It also offers TRUNAAT, RT PCR, and antigen COVID-testing in accordance with ICMR notifications and approvals.
Pharma marketing in digital world
Harshit Jain, Founder and CEO of Doceree, a programmatic physician engagement platform launched in 2019 tells that health-tech startups in various domains such as e-pharmacy, EHR platforms, and home health services are doing some noteworthy work and contributing a great deal towards improving the healthcare landscape of the country.
He further tells, “In the same vein, Doceree is streamlining physician advertising. We believe by introducing effectiveness and efficiency in pharma marketing, Doceree can reduce marketing expenditure by about 10 per cent which would eventually reflect upon the pricing of drugs.”
Jain also claims that in the last four months, company have signed with top 7 out of 10 pharmaceutical brands and over 30 digital platforms in India have partnered with them. He claims, “We are hopeful to build on the initial traction pharmaceutical brands and digital platforms have got a fair taste of how Doceree can positively impact their revenues.”
Enhanced investments during COVID-19 phase
The pandemic has magnified the historically inflexible nature of our healthcare system. It has particularly exposed the shortcomings in the support systems of brick and mortar facilities. It has hence exposed the lacunae in demand and supply in terms of doctors, labs, beds, devices etc.
However, digital healthcare companies are filling the gap by developing new tech solutions and services which includes diagnostic and telemedicine tools, cell phone apps for fitness, well-being, medical and healthcare, and data-driven software.
This has set the right momentum for investment and funding scenario in India. For instance, Centre for Augmenting WAR with COVID-19 Health Crisis (CAWACH) is set to invest in 52 health-tech startups to scale up response for COVID-19.
Furthermore, Practo Technologies has raised US$ 32 million in a fresh round led by different existing investors while US$ 20 million has been pumped by A1A Company, a Chinese insurance company. 1mg technologies has clocked US$ 10 million in funding from the Bill & Melinda Gates Foundation. Netmeds, an online pharmacy marketplace has been acquired by Reliance Retail Ventures Ltd.
Radha Kizhanattam, Partner at Unitus Ventures speaks about the investment scenario in depth. According to her, healthcare startups have better chances to acquire funding in the current scenario, but investors are investing cautiously. While prior COVID-19, investment activity in the Indian health-tech sector were already bit slow.
Kizhanattam claims, “India has been a fertile ground for healthcare, seeing no dearth of talent and innovation in the space. But startups have faced issues with scaling up. But now, exacerbated by COVID-19 has left investors cautious while COVID-19 has fueled health-tech innovation.”
She further adds, “Especially as an immediate response to the pandemic (like design and manufacture of protective gear, research around treatment and management of the virus, etc), we feel that only those that take into consideration its long-term effects and the resulting changes in consumer behavior are going to survive in the long haul.”
Compared to the $475 million that was invested in this space in Q4’19, Q1’20 saw investments of mere $93 million. However, there was an uptick to $153 million (driven largely by late-stage funding rounds) in Q2’20. But, Q3’ 20 has been less than promising with funding of just $60M (July and August).
However, investments in health-tech globally and closer home in China seem to be on the mend. India health-tech VC funding has yet not shown signs of this growth. A vaccine is still at least a year away and solutions that will help consumers in accessing products and services without much exposure of virus are already in high demand.
Unitus is also backing up such platforms. One such company is 5C Networks, an AI-enhanced tele-radiology provider that connects more than 10,000 radiologists to hospitals and diagnostic centres across India. This is a huge boost in demand for telemedicine and tele-diagnosis solutions that allows the consumer to access healthcare and other services.
According to Kizhanattam, these fields had seen a spike in interest in 2016 with about US$230 million being pumped into the space globally. As investors started warming up for the sector again, 2019 saw another jump in interest with over US$350 million of VC money going to it. Indian telemedicine bagged US$ 118 million from this sum.
Telemedicine and tele-diagnosis are not just helping patients directly but are also helping hospitals and healthcare businesses in attaining next phase of operational efficiency. Hence, next decade will see more such startups breaking the existing norms of this sector.
Current wave a renaissance for Indian healthcare
The pandemic is an eye-opener for the importance of developing a sound healthcare infrastructure in India, which still lags. According to a government’s data, the total expenditure on healthcare in 2019-20 was Rs 2.6 trillion or 1.29 per cent of GDP. In 2018 also, India lagged other BRICS countries in healthcare expenditure. Other than this, shortage of healthcare professionals is another pressing problem.
This led to healthcare startups contributing in their own small but innovative ways to entire infrastructure. Innovation is an important consideration for any strong value proposition, especially in healthcare. Indian companies are moreover known to deliver great value for money and the robust health landscape is giving out wonderful opportunities for contribution.
There are number of startups that are solving various problems that Indian healthcare has been grappling with. Apps, Telehealth platforms have ensured that quality doctors are available to the people of tier 2 and 3 cities too now by multiplying their presence.
Similarly, e-pharmacy, EHR platforms and home health startups are also doing some notable work. However, healthcare, technology usage in a critical sector such as healthcare needs to be balanced with the price of inputs and the cost of outcomes. Startups have attained this balance and have provided a greater window of becoming relevant in the market.