Health technology (healthtech) is a rapidly growing sector that has seen a surge in investment in recent years, accelerated since 2020 by the pandemic. Investment in health-tech organizations hit an all-time high amid the pandemic, according to a report by Deloitte, and shows no sign of decreasing. Investment in 2020 was close to USD22bn, double that in 2019 and almost four times that in 2016. Although the pandemic created several obstacles in the healthcare sector, it also presented many possibilities for venture capitalists and inventors. Deep-rooted notions regarding the essence of healthcare and its supply were altered by the pandemic. As a result, the coming decade was declared as the opening of a window of advancements in medical technologies. Healthtech is forecast to advance and become more effective in the coming years.
Investment in healthtech is expected to grow at a compound annual growth rate (CAGR) of almost 16% from 2020 to 2027, to more than USD 630 bn. Several research and consulting firms have analyzed the latest trends that are expected to shape the sector, resolve inefficiencies, and enhance the sector’s efficiency and performance. These trends include the use of AI-powered workflows, data analytics, data interoperability, intelligent virtual assistants, predictive analytics, blockchain-powered transparency, wearable devices, security and compliance, mobile health practices and cloud adoption.
Data privacy and cybersecurity are paramount for healthcare providers. Amid the cyberattacks and privacy concerns, the increasing use of e-health and systems for online surveillance of patients has sparked safety concerns. Fifty-nine percent of the participants from the healthcare sector (vs 52% of the participants from the other sectors) in KPMG’s latest survey (of more than 2,000 executives from around 16 countries and nine sectors), agreed that the healthcare sector’s technological revolution is most influenced by customer demand for stronger data privacy and cybersecurity. Healthcare companies planning to buy innovative software would take such factors into account when making decisions.
The focus of investment companies, angel investors and commercial capitalist groups on digital wellbeing, fair healthcare, psychological wellness, and customer-focused medical portals has increased significantly in recent years. Entrepreneurs able to improve access to inexpensive and effective medical care are of particular interest to financiers.
Key trends in investment in health-tech expected to shape the sector include the following:
- Healthcare worker management – This involves using innovations to increase the output and effectiveness of healthcare workers.
- Drugstore services – This involves using technology to enhance prescription drug delivery and pharmaceutical services.
- Aged-care technology – This refers to the application of technology to help older people continue to live freely and securely in their own homes.
- Digital therapies – These refer to approaches to technology-assisted treatment for a range of medical issues.
- Telemedicine – This refers to the use of communication technologies to supply medical care from a distance, reducing expenses, increasing the availability of medical care and optimising results for patients.
- 3D printing technology – This technology enables the development of customised implants, prosthetic limbs, and different medical equipment.
- Precision medicine – This refers to customising medical procedures by using a patient’s genes and other statistics.
- Virtual reality – This is a useful tool for training healthcare providers and simulating processes. It could also be used to help patients control their stress and suffering.
- Robotic surgical interventions – This refers to performing medical processes using robotic technologies, minimising expenses, and optimising results for patients.
- Nanotechnology – This includes using materials and equipment that are far smaller than atomic particles. It could be used to develop new diagnostic tools and treatments.
- Internet of Things (IoT) – This refers to collecting and exchanging information via networked gadgets. IoT can be used to follow patients from a distance and provide customised treatment.
- Augmented reality – This helps medical personnel examine patient information and receive assistance when treating them.
- Genetic modification – This includes changing genomes using clustered regularly interspaced short palindromic repeats (CRISPR) and other technological innovations. It can be used to cure several ailments and hereditary abnormalities.
- Digital security and data protection – This covers the use of technologies to assure the safety of clinical records amid dangers online.
- Artificial intelligence and machine learning – These are applied to revolutionise patient priority, medications, referrals, and procedural chores, increasing the productivity of processes.
- Green healthcare and technologies – These include investment in the advancement of environmentally responsible tech solutions and operating models that support sustainability and lower carbon emissions.
The health-tech sector is seeing a surge in investment and innovation, driven by the pandemic, an ageing population and demand for personalised and preventive care. Key investment trends aim to offer benefits such as improved productivity, access, quality, efficiency, and affordability of healthcare services and are expected to redefine healthcare delivery. However, challenges and risks remain, such as data privacy and security, regulatory compliance, ethical and social implications, and user adoption and engagement. Healthtech investors, therefore, need to be aware of the challenges and opportunities in this dynamic and evolving sector and collaborate with stakeholders to create value and impact for the healthcare system and society at large and to promote the advancement of tech so the challenges can be overcome.