Healthcare in Asia - innovate today to stay ahead tomorrow
Healthcare markets in Asia are rapidly evolving and global healthcare companies need to address key challenges through innovation to top their game. See how increased collaboration with partners in medical, public and healthcare fields can help companies remain competitive in today's market.
Overview
The dynamics of the world's healthcare markets are rapidly changing, and solutions, services and technology providers have to work doubly hard to understand and address the evolving demand. In more developed markets, healthcare systems are under pressure to become more cost effective, while developing countries are dealing with significant shifts in the nature of healthcare demand as development brings with it a new set of healthcare challenges.
McKinsey predicts that some 900 million people will move from poverty into the middle class in developing Asian countries by 2020, and India's per capita GDP is expected to reach US$5,000 per person in PPP terms in 2013, according to the Economist Intelligence Unit. These developments will drive the increase in demand for healthcare, as well as higher expectations for its quality, variety and effectiveness.
But healthcare systems will have to deal with more than just a simple increase in demand. As these populations become wealthier they are starting to experience a range of new diseases. Greater wealth has led to a increased incidence of obesity and related chronic diseases. India's National Family Health Survey indicates that more than 20% of urban Indians are overweight or obese, which makes it less of a surprise that data from the International Diabetes Federation shows that one of every six diabetics in the world is now India. In China, the obesity rate stands at around 5%, but can reach 20% in some urban centres, with the attendant health issues also notably more prevalent.
Developing solutions to meet this increased and rapidly evolving demand will be one of the key challenges for global healthcare companies. Not only will they have to increase the scale of service provision or production, but they will also have to develop novel approaches and products for new market segments and new disease types. The name of the game is now innovation, and the companies that are best able to harness the knowledge and ideas within their organisations--and, indeed, in the greater healthcare ecosystem--will come out ahead.
Yet the markets that companies will be addressing are as diverse as they are large--with significant variations in culture, ethnicity, nutrition and access to healthcare. This fragmentation will be a key challenge for healthcare providers hoping to tap into the burgeoning markets of the developing world. Clearly, a one size-fits-all approach will not do the trick and a keen understanding of local market dynamics and demand patterns will be critical to success.
Facts on the ground
The changing dynamics of the world's healthcare markets, and particularly those in Asia, are being driven by increasing wealth and the rapid emergence of a new middle class that is more educated, discerning and demanding when it comes to healthcare. According to the Asian Development Bank (ADB), "Asia's emerging consumers are likely to assume the traditional role of the US and European middle classes as global consumers". It noted that consumer spending in Asia reached US$4.3 trillion in 2008 and that based on historical trends this means that by 2030 developing Asia will likely reach US$32 trillion in annual expenditures, or about 43% of worldwide consumption.
The ADB also highlighted some of the healthcare challenges that have come with this increase in wealth, including new environmental and ecological problems, a rise in obesity, and an increase in chronic, non-communicable diseases as people adopt a more sedentary lifestyle. And while this is not a new phenomenon-Time Magazine ran a cover story on diabetes as Asia's newest epidemic in 2002, brought about by the adoption of unhealthy lifestyles from the West-the sheer numbers involved and the increasing pace of development in the region keep the issue relevant today.
In short, this is a market that cannot be ignored. Yet Asia remains under-served by leading global healthcare companies, particularly with regards to addressing healthcare needs specific to the region, be they environmental, genetic or otherwise. This, combined with the growing markets in Asia, means that there is significant room for companies to allocate more resources to the region.
What companies are finding when they do start to focus on the region, is that the diversity of Asia's markets-including different healthcare financing systems and different disease biology for different ethnic groups-requires more than just transferring existing products and services from the developed markets to Asia. They are quickly learning that success in Asia comes only with a deep understanding-both commercial and medical-of the local markets and the ability to develop and implement novel healthcare solutions for Asia's fast-growing markets.
In their approach to innovation, companies are quickly coming to realise that doing it alone is not the best approach. The diversity of medical and technical knowledge and on-the-ground experience in the market is so great that no single company can hope to bring it all together in one organisation. This has led to the adoption of a more open approach to innovation, where companies collaborate with each other and with other external partners such as academic institutions and public healthcare providers.
Pharmaceutical and biotechnology companies, as well as medical technology companies, are increasing their collaboration with academic and medical institutions to tap their scientific and clinical capabilities. This includes working with public and private healthcare providers to gain access to front-line knowledge of medical services delivery and what will and won't work in a specific local market. These kinds of insights help to greatly increase the effectiveness of R&D efforts and allow companies to remain competitive and shorten the time required to develop new products and services and bring them to market.
The Singapore difference
To meet this increased need for collaboration to support innovation, companies from around the world are looking for the right partners to work with. And when it comes to Asia, they are increasingly finding that Singapore, with its strong fundamentals in world-class healthcare delivery and biomedical sciences innovation, fits the bill. With a well-developed integrated research network that gives companies access to capabilities across basic, translational and clinical research, Singapore is well positioned to support companies in their drive to innovate for Asian markets.
Initiatives include the Biomedical Sciences Industry Partnership Office, launched in October 2010, and the EDB-MOH Health & Wellness Programme Office. The former enables companies to engage with Singapore's many world-class research and medical institutions to develop more effective therapies and medical devices. The latter facilitates private-public partnerships to enable companies to test-bed and develop innovative healthcare solutions, and includes the Silver Community Test-Bed Programme that targets solutions for the elderly, and the National Grand Challenge, which targets new solutions for the prevention and control of obesity and pre-diabetes.
In the academic sphere, the National University of Singapore (NUS) in July 2010 launched the NUS Initiative to Improve Health in Asia. The initiative aims to contribute to thinking and policy formulation in public health and health systems development in Asia through multidisciplinary research, high-level policy forums and leadership programmes.
Beyond these specific initiatives, Singapore's integrated healthcare system remains one of the easiest in the world to navigate due to its compact size and efficient organisation. It provides easy access to national specialty centres that focus on areas such as cancer and cardiovascular, eye, neurodegenerative and infectious diseases and is underpinned by an electronic medical records exchange system that facilitates access to and exchange of information across the healthcare sector.
For companies looking to develop new and innovative healthcare products and services for Asian consumers, Singapore's pan-Asian market represents an ideal source of lead demand, as well as a reference site for subsequent commercialisation, scaling and export of these solutions to Asia and worldwide. And with world-class partners ready and willing to collaborate to develop the products and services of tomorrow, Singapore is an ideal partner for healthcare innovation.
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