After a sharp increase in consumption during the Covid-19 pandemicthe telehealth industry is courting new investment to foster innovation and increase access to care in emerging markets.
Digital health companies raised a record $15 billion in global venture funding in the first half of 2021, up 138% year-over-year, with 30% of the total going to telehealth.
It is estimated that $140 billion in private sector financing will be needed each year between 2015 and 2030 to achieve the UN health-related Sustainable Development Goals. the United Nations Conference on Trade and Developmenthighlighting the importance of increasing spending commitments in the global health technology space.
Telehealth in Emerging Markets
As the health technology market in developed countries matures, emerging markets offer opportunities for digital health technology to expand access to care and improve patient outcomes, while reducing health care costs.
In sub-Saharan Africa, for example, some countries have just 0.23 doctors per 10,000 people, according to the World Health Organization.
Investing in low-cost, high-impact areas such as telehealth could help bridge this gap, however, the African health technology market is on track to reach $11 billion by 2025.
Ghana has hosted several health technology initiatives in the public and private sphere. While the Ministry of Health and the Ghana Health Service has set up teleconsultation services since 2016, in collaboration with the Swiss Novartis Foundation, the e-health transformation of the West African nation has recently been accelerated by Covid-19.
In October 2021, a local health technology start-up, mPharma, announced plans to build 100 virtual health centers in seven African markets, namely Ethiopia, Ghana, Kenya, Malawi, Nigeria , Rwanda and Zimbabwe. Backed by Silicon Valley-based Breyer Capital, the startup has raised more than $50 million between its founding in 2013 and 2021.
Last year mPharma’s partnership with the Gabonese strategic investment fundfocused on building drug supply infrastructure, has saved the country about 30% on supply costs.
In February, Nigerian health tech startup Reliance Health raised $40 million in its Series B funding round, the largest amount raised in a single round to date in Africa.
The company offers subscription health plans to its customers and operates telehealth services, a drug delivery system and two clinics in Lagos. Like many health technology start-ups, it also serves as a link between patients and third-party care providers such as hospitals, diagnostic centers and pharmacies. About 90% of Reliance Health’s revenue model focuses on the business-to-business segment, including corporate health care plans for employees.
The future of health
Many countries are leveraging tools such as 5G, artificial intelligence (AI), and the Internet of Things to improve patient outcomes, reduce medical staff burnout, and lower healthcare costs and operating.
In India, AI-based predictive analytics enable early health detection conditions such as diabetes and cancer. These technologies could be integrated with wearable testing devices to provide early testing in underserved rural areas, where 70% of the country’s population lives.
IIndia’s healthcare sector is expected to reach $372 billion this year, and integrating data and AI into healthcare could add an estimated $25-30 billion to GDP by 2025.
Internet connectivity plays a fundamental role in expanding health technologies to underserved areas.
Since 2016, a strategic partnership between several Spanish NGOs, the Pontifical Catholic University of Peru and the Development Bank of Latin America has made it possible to establish 13 health centers in the Peruvian Amazon, providing a population of 8,500 with access to telehealth, largely through the expansion of broadband services.
The private sector is also developing connectivity solutions. East African start-up Rocket Health, with operations in Uganda and Kenya, offers some 400,000 virtual consultations a year, both online and through a USSD service for patients without internet access.
Meanwhile, Saudi Arabia is on track to become the fastest growing digital health market in the GCC, with $1.5 billion in investment planned. for health informatics and digital transformation programs to help it achieve the goals of the country’s Vision 2030.
In February, the Kingdom launched the SEHA Virtual Hospital network, the largest of its kind with 130 affiliated hospitals.
Activating the extension
Valued at $1.8 billion in 2020, the telehealth market in Latin America is expected to grow at a compound annual growth rate of 20.3% to reach a value of $5.6 billion by 2026.
Colombia, for example, saw a 7000% increase in virtual dating in 2020.
The use of Spanish in the region outside of Brazil could enable cross-border telehealth consultations, improving access and quality of health care despite local infrastructure gaps.
The public sector is driving the growth of telehealth in the region, especially in Chile and Uruguay. In Argentina, telehealth is managed by the National Telehealth Plan and the Telehealth Advisory Council.
Improving patient privacy regulations could also help encourage the adoption of health technologies and telehealth. Mexico and Uruguay are the only countries in the region to national data protection authority operating independently of the Ministry of Health.
The pandemic has also catalyzed the expansion of telehealth and health technologies throughout Southeast Asia. A recent survey of the Asia-Pacific region found that telehealth usage had doubled since 2019 and is expected to reach 60-76% penetration by 2024, with Indonesia and China leading the way.
Many great East Asian apps offer digital health services, including Gojek, Indonesia’s first unicorn, which merged with e-commerce marketplace Tokopedia last year to become GoTo.
Indonesian healthcare superapps Alodokter and Halodoc received significant funding to expand their businessthe latter serving 7 million patients per month, 80% of whom reside outside the cities of Jakarta and Surabaya.