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The mHealth Revolution

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ESSEC\’s professional thesis from Bruno Rakotozafy (2011). Following an internship at General Electric Healthcare

ESSEC\’s professional thesis from Bruno Rakotozafy (2011). Following an internship at General Electric Healthcare


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  • 1. ADVANCED MASTER’S DEGREE INSTRATEGY AND MANAGEMENT OF INTERNATIONAL BUSINESS The M-Health revolution: which opportunities for a medical device company? GE Healthcare Presented by Bruno RAKOTOZAFYProfessional Thesis Advisor: Xavier PavieMission Advisors: Laurent Roche & Eliane Apert
  • 2. RésuméLe secteur de la santé est un secteur particulièrement complexe car il implique de nombreuxacteurs et touche potentiellement tout le monde. Il est également hautement dépendant desétats et des instances régulatrices ce qui le rend différent de tous les autres secteursd’activités. C’est peut-être pour ces raisons que le secteur de la santé n’a pas encore été, oupeu, impacté par les Technologies de l’Information et de la Communication (TIC) commel’ont été la plupart des autre activités. Cependant nous observons une tendance profonde aurapprochement entre la santé et les TIC, à l’heure où les gens apprivoisent l’usage del’Internet et des objets connectés dans leur quotidien. Cette convergence naturelle entre unescience millénaire et des technologies chamboulant l’ordre établi pourrait bien prendre sonessor avec l’apparition de solutions innovantes de M-santé (santé Mobile). Instrumentsmédicaux connectés, plateformes Internet participatives, applications santé sursmartphones, médecins connectés, téléassistance aux personnes dépendantes. Voiciquelques exemples d’applications promises par la M-santé et qui pourraient révolutionner lafaçon dont le secteur est structuré et les soins sont prodigués. Les fabricants d’équipementmédical possèdent la légitimité pour devenir les locomotives de ce mouvement en marche.C’est donc dès à présent qu’il convient, pour ces entreprises, de détecter les opportunités àsaisir, d’imaginer les produits et solutions pertinentes, de construire l’écosystème associé etenfin de prévoir les modèles économiques qui seront viables.Mot-clés : Santé, M-Santé, Equipement Médical, TIC, Internet, Smartphones, Docteurs.AbstractThe health sector is a particularly complex one because it implies lots of actors and impactspotentially everyone. It is also highly dependent on states and regulatory bodies making it bedifferent from the other business sectors. This may be the reason why the health sector hasnot been stricken by Information and Communication Technologies (ICT), on the contrary toother business fields. However we can notice a convergence trend between health and ICT,while people have adopted the use of Internet and connected devices in a daily basis. Thisnatural convergence is bringing the most promising applications with M-health solutions(Mobile health). Connected medical devices, web health platforms, smartphones’ health appsor connected physicians are some of the most encouraging solutions that could revolutionizethe health sector and the way healthcare is provided. Medical devices manufacturers havethe legitimacy to lead this undergoing movement. There is no more time to waste for thosecompanies to detect opportunities, design relevant products and solutions, build associatedecosystems and overall imagine correct business models.Keywords: Health, M-health, Medical Devices, ICT, Internet, Smartphones, Physicians.
  • 3. INTRODUCTION……………………………………………………………………..2PART 1 -   THE HEALTH SECTOR: A CONSERVATIVE APPROACHDESPITE OF INNOVATIVE TECHNOLOGIES ................................................ 4   1-   HEALTH CONCEPT IN THE SOCIETY ......................................................................... 4   a)   Sociological and demographical aspects................................................................... 4   b)   Scientific aspects ....................................................................................................... 7   c)   Economic aspects...................................................................................................... 8   2-   THE HEALTH SECTOR GATHERS A LOT OF PLAYERS............................................... 10   a)   Women and men are the heart of healthcare .......................................................... 10   b)   Pharmaceutical and medical equipment industries are innovation leaders ............. 13   c)   Payers: State is the primary payer and health insurances complete the offer......... 16   d)   The patient: a forgotten end-user ............................................................................ 18   3-   A BIG PICTURE OF THE HEALTH SECTOR ............................................................... 19  PART 2 -   WHEN ICT MEET HEALTH.......................................................... 21   1-   FROM INFORMATION AND COMMUNICATIONS TECHNOLOGIES TO CONNECTED HEALTH TECHNOLOGIES ........................................................................................... 21   a)   A short story of communications and its recent ramping evolution.......................... 21   b)   Connected health technologies: E-health and M-health .......................................... 24   2-   DIFFERENT PLAYERS FROM DIFFERENT BACKGROUND IN THE M-HEALTH UNIVERSE. 27   a)   Consumer electronics manufacturers ...................................................................... 27   b)   Infrastructure builders and telecom operators ......................................................... 29   c)   Healthcare stakeholders .......................................................................................... 30   d)   A big picture of the M-health.................................................................................... 31  PART 3 -   WHICH POTENTIAL MARKETS TO TARGET AND BUSINESSMODELS TO DESIGN? .................................................................................. 32   1-   UNDERSTAND THE HEALTHCARE PATTERN AND IDENTIFY KEY CHANGING FACTORS . 32   a)   Education/prevention, diagnosis, therapy, post-treatment monitoring..................... 32   b)   Targeting the real challenges .................................................................................. 36   c)   Home care services ................................................................................................. 41   d)   Patient empowerment.............................................................................................. 42   e)   Cost, access, clinical outcomes ............................................................................... 43   2-   DESIGN A RELEVANT BUSINESS MODEL ................................................................ 44   a)   Why medical device companies are more likely to be leading players in M-health?44   b)   Build patient centric solutions .................................................................................. 45   c)   Adaptation to the complex practice of healthcare.................................................... 47   d)   Build partnerships to provide fully integrated M-health solutions............................. 48   e)   How to sell and monetized wireless health solution ................................................ 50   3-   FORESEE ADVERSE OR COLLATERAL EFFECTS OF M-HEALTH SOLUTIONS: BE CONSCIOUS AND RESPONSIBLE INNOVATORS. ............................................................. 54   a)   Ethics and health Information security..................................................................... 54   b)   Reduce impact on environment and people ............................................................ 54   c)   Use of M-health in the developing world.................................................................. 55   Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 1
  • 4. IntroductionIt is not abusive to say that the world has entered a new area: the connected world. Thisevolution has led to many changes in the society and in human activity. This movement hasbeen supported by the emergence of Information and Communication Technologies alsoknown as ICT. ICT is often quoted nowadays and in reality those technologies are muchmore present than one can expect since they are deeply impacting our daily life. Thesetelecommunication technologies, and the consequential applications, are literally reshapingour life. In the meantime some activities stayed reluctant to these changes and have knownkind of inertia. One of the obvious sectors that have remained conservative toward this trendis the health sector.It would be crazy to think that the healthcare world will remain “disconnected” and completelyseparate from that revolution on the way. More and more people are now thinking aboutapplying all those discoveries to health. And especially how applying mobile technologies tohealthcare. It is still the preliminary phase of an important movement. What is sure is that thepath seems to be though because of the inherent sector’s complexity but also becausehealth is a serious matter. Yet this seriousness is also the most powerful reason to makechanges happened. One significant point to highlight is that ICT technologies have radicallychanged the business approach in economic sectors already impacted. The shift from aselling-industrial-product approach to a providing-integrated-services one. In our case itmakes sense since healthcare is basically a service.The purpose of this work is clear. Help understanding both health and ICT sectors in order tounderstand how they can converge and how it would be possible to deliver relevantsolutions. Understand the two universes means understand them deeply, understand theirtechnical aspects, understand their own philosophy, understand their relationship with thepeople they provide and understand how the different stakeholders of both worlds couldfinally find a mutual interest. To be simple the problematic we are going to answer is:“When health becomes mobile: which opportunities to catch and which business models toimplement in order to provide and improve health services through mobiles devices. Anatural convergence between ICT and medicine”In order to deal with this really exciting but complicated subject it has been necessary todefine the scope of such a work. Indeed it would have been pretentious trying to tackle everyaspect of this challenging topic. One reason is that both health and ICT fields are extremelywide ones and include tons of different things. Another reason is that the diversity of ourworld make this problematic be very region-specific.That is why first it has been chosen to focus on mature countries, and France will be ourmajor illustration. We will sometimes consider and talk about the US because it is still one ofthe most innovative countries in the world and it will help us to provide more examples.Second we will treat the subject from a business point of view. Obviously we will have to dealwith political, philosophical or ethical aspects but always as evidences to support thebusiness relevancy. Finally we have decided to include in the scope a reflection about howthose innovations could be responsibly designed. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 2
  • 5. This work will be of interest especially for medical device companies which are, as we willsee, the most relevant players to lead the wireless health movement. In a larger extent thisreport will be also useful for all actors that are involved in the healthcare and the ICTindustry. The health sector is clearly undergoing main transformations and those innovationscould be growth drivers in the near future. It will also be of interest for entrepreneurs whowould like to take part in this revolution, because opportunities are huge and there will havespace for a lot of actors. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 3
  • 6. Part 1 - The health sector: a conservative approach despite of innovative technologiesCompared to other business fields the health sector is highly complex to approach. For ourpurpose, the aim is to understand how this sector is structured from a business point of view.But healthcare is much more than a simple business. Fundamentally it is even frequentlyassumed that healthcare is a public topic and for the Universal Declaration of Human Right1health is recognized as a universal right (article 25).In this particular context it is crucial to capture the full picture of the health environment. Inorder to do so we will first try to understand how healthcare activities are imbricate in humansocieties, at socio-demographic, scientific and economic levels. A second part will bededicated to introduce the myriad of stakeholders playing a role in the healthcare universe. Itwill include healthcare professionals, industrial actors, payers and last but not least patients. 1- Health concept in the society a) Sociological and demographical aspects Humans and healthHealth is a topic at the center of human existence as it is directly and indirectly linked to lifeand death considerations. From the first historical record discovered so far health issueshave been mentioned. The first doctor known is Imhotep, an Egyptian who lived twomillenaries before Christ2. Among other genius activities Imhotep left a textbook on how totreat some illness. To illustrate the importance of health and, as a direct consequence, thepower obtained by persons who can master it, Imhotep was so revered that Egyptians usedto worship him as a god. Medicine genesis can even be tracked before Antiquity, thanks torecords of plant use for medicinal purpose.According to the World Health Organization “health” is “a state of complete physical, mentaland social well-being, and does not consist only of the absence of disease or infirmity”3. Thismodern definition of health put emphasize on the fact that health not only includesanatomical aspects but also psychological and mental ones. We will not try to debate aboutthe border between well-being and being healthy because it is not relevant for our purpose.But we could be sure that as a general matter, health is a key occupation in human’s life. Is health an individual or a group concern?In the 1940’s a psychologist called Abraham Maslow delivered a theory to explain whatmotivated humans. His theory, originally presented as a hierarchical model was latersimplified into a pyramidal scheme, as showed in Figure 1.1 Déclaration universelle des droits de lhomme, 1948 (http://goo.gl/1c7kv)2 Saari, Peggy. “Medicine And Disease – Who Was The First Doctor In History?.” History Fact Finder. Ed. Julie L. Carnagie.UXL-GALE, 2001. eNotes.com. 2006. 30 Sep, 20093 Preamble to the Constitution of the World Health Organization, 1946 (http://goo.gl/ZRAUF) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 4
  • 7. This representation helps us to realize that health is a basic need. And because it is a basicneed for each of us, maintaining a good level of health is a strong individual motor. Nevertheless we can feel that health is more than an individual concern, it is also a group preoccupation. First, the ill person often cannot treat itself. It receives treatment from another person. Answering the health need require, at least, 2 people. Second because a disease not only impact the sufferer but also its entourage. Because either the disease is contagious, or because the sick person cannot take care of itself. So quickly civilizations and society had to organized healthstructures in order to manage or monitor individuals’ health. In a society this organization is Figure 1 - Maslows hierarchy of needs often known as “public health”. According to Charles-Edward AmoryWinslow, a famous American thinker and teacher at Yale University, public health is “thescience and art of preventing disease, prolonging life and promoting health through theorganized efforts and informed choices of society, organizations, public and private,communities and individuals”4. This concept was theorized quite recently but we can observepractical examples of it since ancient times. For instance Romans understood that it wasnecessary to control human waste diversion in order to limit diseases among urbanpopulations.Today public health is a major concern in western countries and in 1948 a world-scalestructure were set up to tackle with this issue: the World Health Organization (WHO). In amajority of mature countries, including France, health is highly funded by governments andrepresents a huge part of states’ expenditures. Governments implication is justify by the factthat health is considered as a primary right. National health insurances will be described laterbut we can already write that health, as a group concern, is an economic subject.So we better understand now that health is both an individual and a group concern. It isimportant to know that for our purpose. Indeed we will take into account this doubleconsideration when we will talk about relevant business models to design. Mobile solutionswill have to be individually accepted while promoted by opinion leader groups. Different cultures, different health standardsAs we have just seen health is a double concern. But we can also underline that health isculture-dependent. Health is closely link to cultures and religions since it concerns person’sintimacy. The science that focuses on that relationship is called medical anthropology.Herman, in 2000, defined the medical anthropology as “how people in different cultures and4 The Untilled Fields of Public Health, C.-E. A. Winslow, 1920 (http://goo.gl/NcyPY) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 5
  • 8. social groups explain the cause of ill-health, the type of treatments they believe in, and towhom they turn if they do become ill”5. It is not a revelation to say that in different cultureshealth is considered differently. Eastern countries put emphasize on traditional and softmedicine. For them plants are the most efficient drugs. And mind is the better tool to preventor fight illness. In some other cultures or religion, women are treated differently than men.Even if we will focus on western countries in this work, it is useful to be aware of that sincepopulations in those mature countries are being more and more multi-cultural.In general, health in the western world is characterized by its technical-medical approach. Ifwe have another look at the WHO definition of health (“state of complete physical, mentaland social well-being, and does not consist only of the absence of disease or infirmity”) wecould say that health practice in western world is focused on “physical” and “absence ofdisease or infirmity”. In practice it means that health is a scientific subject that should behandled as a pragmatic, factual and empirical one. Little credit is given to non-visible, non-demonstrable solutions. Strong evidences are mandatory and it is the only valuable way toproceed.We should keep that idea in mind because rationality will be the principal way to give value tomobile solutions. It will be necessary to provide strong evidences and measurable benefits. Health and demographyTo conclude with the importance of health in our societies it makes a point to talk abouthealth and demography. Not only health discoveries have strongly impacted the worlddemography but the opposite is also true. Demographic changes influence health systems.Life expectancy has globally (but unequally) rose all along human history in parallel to healthinnovation that has allowed reducing mortality. As a consequence the world population hasexponentially grown. Hardly 1 billion human on earth in 1800 it is assumed that we will be 9billion in 2050. For sure those medical innovations were major improvements for humanity.But in the meantime there are side effects of this demographic explosion, indirectly impactinghealth of people. It will be tough to detail all factors that have been influenced bydemographic changes and in return threat our health so we will just give some easyexamples.Demographic boom has increased populations’ concentration. In addition to rural exodus inmature countries during the last century it has led to a very high human density in urbanareas. And this over-population not well structured can sometimes causes different issues.Among others it is a factor creating insanitary zones and promoting spreading of contagiousillnesses.Ageing population is another heavy demographic trend. Medical progress allowed peopleliving longer but this has also brought a bunch of new diseases specific to elderly. This isparticularly important in mature countries and we will see further the impact of that ageingtrend.5 Culture and Health: Applying Medical Anthropology, Michael Winkelman, 2008 (http://goo.gl/csWTu) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 6
  • 9. b) Scientific aspectsFor a better understanding of health sector it is important to exhibit a brief timeline of medicalpractice and technologies.From antiquity to Middle AgesThe first proof of medical practice is dated from the new Stone Age6 with the discovery oftrepanations practice. Trepanation consists in boring a hole in the skull. It is believed thattrepanning was used to relieve horribly painful headaches.As said previously Imhotep was the first physician known by name. But it is considered thatthe born of modern medicine came with Hippocrates, around 400 years B.C. Hippocrates(460-310 B.C) based medicine on objective observation and deductive reasoning. Galen(131-201 A.D) was considered to be the most important contributor to medicine followingHippocrates. He was personal physician to several emperors and published some 500treatises. Up to now he is still respected for his contributions to anatomy, physiology, andpharmacology.Persian doctor Rhazes (865-925 A.D) is famous for having pioneered pediatrics and wasknown to have been the first to use anesthesia before surgery. Muslims have brought a lot inthe history of medicine. Avicenna (980-1037) wrote The Book of Healing and The Canon ofMedicine, establishing experimental medicine and evidence-based medicine. He was theprecursor of modern hospital concept in the Middle East. Those books remained a standardin European universities until the 18th century. A second Muslim, Avenzoar (1091–1161) isknown to be the father of modern anesthesia.From 16th to 18th centuriesBut this is not until the early 16th century that Paracelsus, a German alchemist, pioneered theuse of chemicals and minerals in medicine. Then there was a major revolution in Europeanmedicine with the release of Fabrica Corporis Humani, written by Andreas Vesalius, whichcorrected major Greek medical errors. In the meantime variolation (infecting peoplepurposively with smallpox) was implemented in China7. Variolation, and inoculation ingeneral, would further lead to vaccination’s concept.In 1590 Janssen invented the first rudimentary microscope. This was an important milestonein medicine’s history since Anton van Leeuwenhoek (1670) used this tool to first tocharacterized human cells. In 1650 Sir Christopher Wren was the first to administermedications intravenously and experiments with canine blood transfusions.Later, Edward Jenner (1749-1923) developed a method to protect people from smallpox byexposing them to the vaccine virus (a cow disease). The process became known asvaccination. Jenner is sometimes called the founding father of immunology.The 19th century: revolution of tools6 History of medicine, Wikipedia (http://goo.gl/HBTB7)7 Une petite histoire de la medicine, Valentin Daucourt, 2002 (http://goo.gl/oZfi4) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 7
  • 10. For a long time, the practice of medicine was based on patient’s descriptions of symptomsnot based on hands-on experience such as examination of a patient’s body. The 19th centurywas a turning point for physicians thanks to innovations in medical techniques andequipment to better diagnose and treat patients.Stethoscope (1816), ophthalmoscope (1851), laryngoscope (1859), X-ray use for medicalimaging (1895), sphygmomanometer (blood pressure meter, 1896) and ECG (1901) changedthe way diagnosing people, to hear, feel and see their bodies.The first human blood transfusion (1819), the first vaccine for cholera (1879) and the firstbottle of aspirin sold (1899) were major innovations to treat or prevent people.In parallel new methods improving medicine practice appeared. Antiseptic Principle of thePractice of Surgery (1867) by Joseph Lister, convinced of the need for cleanliness inoperating rooms. In the 1870’s Louis Pasteur and Robert Koch established the germ theoryof disease. Before this discovery, most doctors believe diseases were caused byspontaneous generation.The 20th century and nowEverything went faster during the 20th century. The use of technologies from other fieldsallowed a revolution in diagnosis. Medical imaging breakthroughs (X-ray, ultrasound,computed tomography, magnetic resonance imaging) resulted from advances in physics,mechanics and computer sciences. Biological diagnosis benefits from innovations in biologyand automation. There was in the same time a revolution in treatment. Drug manufacturingbenefits from chemistry and biology improvements. Equipment like intensive care units orpace makers overcome unpaired human functions. Transplantations and grafts became areality thanks to biology advances.Today we even go further with biotechnology and bionic sciences. We are almost able tocreate super-humans or living beings from scratch.Despite of this huge step further in health technologies during the last century, practice ofmedicine has not evolved as fast. This prosperous era of technology improvement was agood thing for the emergence of health industry (pharmaceutical and equipment industry).But when we talk about how healthcare is provided, progresses are few. More than that,healthcare professionals have loose influence and weight in favor of the industry. c) Economic aspectsIn order to evaluate the weight of health in our society it is important to determine theeconomic impact. The aim of this report is to select best opportunities to be addressed bymobile solutions and it is worth understanding the most promising health sub-sectors.The Chart 1 gives us an overview of health expenditures’ weight compare to the GDP inFrance. Representing 11,7% of GDP in 2009, French health expenditures are far below theUSA spending around 17,4% of their GDP. Nevertheless it is above the OECD average(9,5% of GDP). Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 8
  • 11. 2000 2009Care and medical goods consumption (CMGC) 115,1 175,7 Funding pattern of CMGC: Social security 77,1% 75,5% Local collectivities 1,2% 1,3% Complementary Organisms (Mutual fund, Private Insurance) 12,7% 13,8% Households 9,0% 9,4%Residential Care Facilities 2,9 7,4Daily indemnity 8,2 11,9Prevention 4,1 6,2Health professionnals social coverage 1,6 2,0Research 5,4 7,5Training 0,8 1,3Administration costs 11,4 15,3National health expenditures 146,9 223,1% of GDP 10,2% 11,7% Chart 1 - France health expenditures, € billions (source: INSEE)Obviously “Care and Medical Goods Consumption” is the first account but it is remarkable tonotice that administrative costs ranked second, with almost 7% of the total.Translate into per capita expenditures it gives €3600 for every French citizen. “Care andMedical Goods Consumption” is mainly financed by the Social Security with up to 75% ofexpenditures covered. But between 2000 and 2009 the part of households andcomplementary organisms in that funding rose by 1,5%. 2000 2009Hospital care 52,7 78,0In-town care 31,2 48,3 Physicians 15,2 22,1 Healthcare associates 6,3 11,6 Dentists 6,7 9,8 Analysis 2,8 4,5 Other 0,3 0,3Transportation 1,9 3,6Medications 23,6 35,4Other medical goods (glasses, prosthesis, disabled 5,7 10,5vehicles, small equipment and bandage)Care and Medical Goods Consumption 115,1 175,7% of GDP 8,0% 9,2% Chart 2 – Breaking down of Care and Medical Goods Consumption, € billions (source: INSEE)A deep dive into the principal account of national health expenditure, “Care and MedicalGoods consumption”, shows us that some categories have almost doubled (Chart 2). Forinstance the “healthcare associates expenditures” account, mainly represented by nursesand physical therapists rose from €6,3 to €11,6 billion. The same observation can be madeabout the “other medical goods” category. It could be explained by a volume increase and aprice increase. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 9
  • 12. Finally it is important to notice that the economical weight of health depends on the population’s age. Figure 2 explicitly proofs that the older the person is , the higher health expenditures are. The impact of ageing population is then obvious. Graph 1 - Health expenditure per capita by age (source IRDES) 2- The health sector gathers a lot of players.In this section will be exposed and detailed the categories of players that are involved in thehealth sector. The description will be based on mature countries scheme, especially onFrench and US ones. It will help us to determine who hold influence and decision’s powers.In order to approach the sector easily, four groups of « involved parties » have beenidentified and will be set forth. First, healthcare professionals, representing the heart ofhealthcare service. Second, health industrial companies, including pharmaceutical andmedical devices firms, providing healthcare professionals with tools and products to treatindividuals. Strongly linked to the first category they often are the initiators of innovations.Then states and governments will be depicted as central players in the stakeholder map.Finally patients will be outlined. Although they are the final beneficiaries of any healthcareservice it makes a point to describe this group lastly if we consider its power of influence. a) Women and men are the heart of healthcareThe general practitioner is the common image that comes to one’s mind when the healthprofessional word is mentioned, at least in western countries. But it would be improper tolimit the healthcare workforce to this unique category of women and men.Because « healthcare » include the word « care » it will not be surprising that the healthcareprofessional category includes social and paramedical occupations in addition to general andspecialist physicians. Health occupations: from medicine competencies to social activitiesHealthcare professionals constitute a non-homogeneous group of people aiming at providinghealth services to individuals, families and communities. But their action is not limited to cureill people as they also provide preventive, promotional or rehabilitation services. This waythey also have an impact on healthy people. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 10
  • 13. Physicians and pharmacists: the upper classAccording to INSEE standards (French Statistics Institute)8 a first sub-group can beidentified. It gathers the medical and pharmaceutical professionals. Highly knowledgeableabout medicine, doctors in medicine, professors in medicine, pharmacists but also dentalsurgeons represent an upper class within the health workforce, since they are the mostskilled. Their mission is to promote, maintain or restore human health thanks to the inquiry,diagnosis, and cure of physical disorders, diseases or mental impairments.In almost all countries, educative paths to become medical or pharmaceutical professionalare among the toughest and the most elitist ones. For instance in France a doctor isauthorized to practice after 6 years of higher education at university and 3 years of internatunder the responsibility of an experienced physician. A numerus clausus is applied as soonas the second year and limits the number of practitioners. If one desires to be a specialist,the internship part is again longer. Education for pharmacists or dental surgeons is roughlyas long and hard.Being a practitioner is often a vocation. The personal choice to carry out a hard educativecourse may be motivated by different factors but generally it has roots in the idea of helpingand curing others. The Hippocratic Oath9 shows exactly that state-of-mind. Requiring a highlevel of knowledge for treating people and make them being in a better shape there is also ahigh degree of psychology in the art of medicine. The psychoanalyst Mr Balint has studiedthe particular physician-patient relationship and it results to 3 key points10. i) One of modern medicine’s weak is its trend to focus more on curing a disease than treating an ill person. ii) One third of the medicine practice is only a psychotherapist one. iii) The physician-patient relationship is based on domination and submission, linked to the power of the physician and the weakness of the patient.Other aspects of this physician-patient relationship will be discussed further in a partdedicated to the rebalance of the power and its acceptance for the development of healthmobile services. One last point is that people (and physicians too) often considers the activityof physicians as synonymous with high ethical and integrity standards and hardly with acommercial occupation. That is also a fundamental point in the design of an acceptablebusiness model for mobile health services.Pharmacists are in a quite similar position than physicians in their relation with patient. Theirmission is to guarantee the well distribution and selling of medication and to ensure the safeand effective use of medication. They act as intermediaries between the prescriber and thepatient. In this role they share a heavy legal responsibility with physician. In France,pharmacists have also prescriptive authority. Moreover these medication specialists are oftenthe first point-of-contact for patients and their role more and more includes the managementof health. That mechanically increases their responsibility. On the contrary to physicians, the8 INSEE, Healthcare professionals in France, 2010 (http://goo.gl/uQgjZ)9 Hippocratic Oath, Translated by Michael North, National Library of Medicine, 2002. (http://goo.gl/yZuI3)10 Balint M. " Le Médecin, son malade et la maladie " Trad. J.P. Valabrega,Petite collection Payot, Paris, 7ème éd. 1996 Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 11
  • 14. pharmacist’s status suffers from a lack of recognition. Although they bear an enormous levelof responsibility they tend to be seen like commercial professions. Plus their relations withphysicians have often been conflicting when it is about to decide the limits of each other’sactivity, and the share of decision power between them. The emergence of generic and over-the-counter drugs continues to create divergences. However pharmacists remain key playersin health systems and a 2009 poll in France11 illustrates this statement. 55% of intervieweesanswered that the pharmacist is the second most viewed health professional and for 96% ofthe sample “the pharmacist is an essential health professional”.All these factors have feed the idea that medical and pharmaceutical professionals are abovethe average persons. In a 2009 French poll title “Perception of occupations”12, the generalpractitioner occupation is ranked 2nd in both term of prestige (48% of interviewees answered“lot of prestige”) and term of utility (79% answered “very useful”). As a result it may be logicalthat a feeling of superiority appears among the medical professionals themselves. The pointhere is not to criticize their status and the importance of their competencies but tounderstand how they can feel uncomfortable faced upon major changes the mobile healthrevolution could bring.Medical assistant occupations: the insidersBesides the medical and pharmaceutical sub-group, still according to the INSEEcategorization, we found medical assistant occupations. This category gathered a wide panelof health professionals including nurses, diverse therapists (physiotherapists, podiatrists,speech therapists, orthoptists, opticians or audiologists) and technicians (mainly X raytechnicians). Their role is totally supplementary to the first sub-group of physicians andpharmacists in providing health services. These occupations are seen as less prestigious inmodern health system. This is the case for some therapists, not considered as specialistphysicians, and overall the case for nurses. The education path is for sure shorter and theirscientific knowledge level is obviously lesser than physicians one. But they play a key role inthe act of providing health care and support the physician or pharmacist’s activity. In generalthey also pay more attention to the environment and the history of patients than physiciansand as a consequence are really good interlocutors for patients.Within this group nurses and midwives represent the largest contingent. Indeed, according to2011 WHO (World Health Organisation) statistics in (Chart 3), nurses and midwives areglobally twice as much as physicians. Physicians Pharmacists Nurses & midwives France 213 821 75 432 548 429 World 9 171 877 2 587 043 19 379 771 Chart 3- Healthcare workforce (source: WHO health report statistics, 2011)Although they do not or hardly have prescriptive authority, medical assistant workers are keyactors in the development of mobile health services for different reasons: i) They are numerous and constitute a dense network. ii) They really are on-the-field and have the empirical knowledge of the health system11 Vision Critical, Image et attachement des Français à la profession de pharmacie, 2009 (http://goo.gl/xShto)12 Logica-TNS Sofres, L’image des professions, 2009 (http://goo.gl/4gNDh) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 12
  • 15. iii) In some areas they are the only health actors, especially in remote areas. iv) They are receptive to innovations that increase their recognition. v) They are interesting in solutions improving their efficiency. b) Pharmaceutical and medical equipment industries are innovation leadersThere are two industries that are predominant in the health universe. First is thepharmaceutical industry. Second is the medical equipment one. Both of them are verypowerful, scientifically and economically. The major milestones of medicine innovation havebeen previously explains and it showed that at the beginning initiators of breakthroughs weremostly men and women. Pharmacists were used to create drugs in their own laboratories.And ingenious people invented physical or mechanical systems to diagnose or helpphysicians curing diseases. Then in the last century, the health sector was deeplytransformed by the industrial revolution that occurred in all the business areas. Todaypharmaceutical and medical equipment firms are unavoidable and among the most influentialand profitable at a global level.The aim of this part is first to discover how these industries are organized. The secondobjective is to understand the exact role of those companies and how they interact with theother health actors in mature countries. A last point will raise the paradoxical situationbetween the purpose of a for-profit enterprise and the ethical dimension of health business. Pharmaceutical companiesThe pharmaceutical industry develops, produces, and markets drugs for use as human orveterinary medications. It is one of the most profitable industry gathering pharmaceuticallaboratories and biotechnology companies.Facts and figuresAt the beginning medication used to be made by apothecaries and sold in drugstores. Thefirst of this store known was active in the medieval Islamic world, a fertile region and periodfor health innovations, as previously detailed. Most of contemporary’s pharmaceuticalcompanies were born during the chemical revolution at the end of 19th century when drugscould be synthesized.The 2009 global pharmaceutical market was evaluated at $810 billion. The French domesticmarket weighted more than $40,5 billions the same year according to IMS Health13, at thefourth position after the US, Japan and Germany. The average net income for the top tencompanies is around 19% according to Global 500’s Fortune ranking.Produce a pharmaceutical product requires a lot of money and time. In addition to be one ofthe most profitable industries it is also the one spending the most in research anddevelopment. Overall 2009 global expenditure on discovering and developing new medicinesamounted to an estimated of $70 billion14, i.e. 9% of revenues.13 Global pharmaceutical industry and market, ABPI (http://goo.gl/NT73t)14 Drug R&D spending fell in 2010, and heading lower, Reuters, 2011(http://goo.gl/hEBsa) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 13
  • 16. Just to understand briefly the pharmaceutical activity it is useful to have a look at Figure 3.As showed, the development process for one drug, before being on the market, lastsbetween 10 and 12 years and costs in average $850 million15 according to a recent study. Figure 2 - Development of a pharmaceutical productMarketing expenses and compliance in the pharmaceutical industryAfter R&D, the marketing and promoting effort is the most important activity forpharmaceutical firms. Worldwide pharmaceutical marketing & sales spending were of $89billion in 2009 according to Cegedim16, a market research company. Yet this is significantlyhigher than R&D expenditures and it can be explain because of different factors.The most valuable assets for a pharmaceutical company are its patents. In general a patentlasts 20 years with the possibility to extend this period for few years. A patent allows the firmto make sustainable selling of the patented drug without being threat by the competition. Ifwe have a look to pharmaceutical firms‘ financial accounts we can observe that revenues areconcentrated on the best-seller drugs, also called blockbuster. Unfortunately we are today ina period were a lot of patents are falling in the public domain, without being really replacedby new blockbusters. It is a marvelous opportunity for a new kind of pharmaceuticalcompanies that manufacture generic drugs based on this unpatented blockbusters. In suchan environment the battle occurs on the marketing and sales fields that need huge amountsof money.Another particularity of the pharmaceutical industry is the tough regulatory frame. The Figure3 shows that a market launching follows 2 pre-approvals and one final approval fromregulatory bodies. In France the regulatory organism is called AFSSAPS. And it is neverfinished since during the commercialization a drug is still assessed. The phase 4, orpharmacovigilance phase, aims at evaluating the benefit/risk ratio. Some recent events inFrance (for instance Servier case) have showed that this continuous evaluation is bothnecessary for the users and critical for the companies.15 Estimating The Cost Of New Drug Development: Is It Really $802 Million?, C. P. Adams and V.V. Brantner,2011(http://goo.gl/MXn0U)16 2010 Audited Pharmaceutical Marketing Expenditure Results, Cegedim Strategic Data (CSD), 2011 (http://goo.gl/i4TXe) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 14
  • 17. Are pharmaceutical firms responsible innovators?Up to now pharmaceutical companies have not been the most active in integratingresponsibility in their innovation process and in the lifecycle of their products. For instancetough debates are tough about the animal testing during pre-clinical trials. In 1959 Russeland Burch have described the “3Rs” principle for the use of animals in research17. i) Replacement refers to the preferred use of non-animal methods over animal methods whenever it is possible to achieve the same scientific aim. ii) Reduction refers to methods that enable researchers to obtain comparable levels of information from fewer animals, or to obtain more information from the same number of animals. iii) Refinement refers to methods that alleviate or minimize potential pain, suffering or distress, and enhance animal welfare for the animals still used.Drug recycling channels exist but have experience issue. In France Cyclamed was createdby pharmaceutical companies to cope with the collect of pharmaceutical products. Theseproducts are particularly sensitive ones since they include complex component.Unfortunately Cyclamed has to stop its recycling activity (sending of unused drugs in poorcountries) in 2008 due to embezzlement problems. Medical device companiesMedical device companies are the other health industry actors. According to the WHO amedical device means “any instrument, apparatus, implement, machine, appliance, implant,software, or material to be used for human beings for the purpose of diagnosis, prevention,monitoring, treatment of a disease or an injury”18. By definition this term covers a vast rangeof equipment, from simple tongue depressors to MRI machines, including wheelchairs orpacemakers. In other words this industry provides thousands of different products. It is stillpossible to categorize those products into different classes: i) Diagnostic/analysis devices ii) Drug administration or surgery devices iii) Substitution/support devices iv) Monitoring devicesFacts and figuresAs a consequence there are hundreds of companies operating in this market, but themajority of revenues are concentrated by thirty of the top companies, among them: Johnson& Johnson, Siemens Healthcare, Medtronic, GE Healthcare and Baxter.According to Kalorama19, the 2009 global medical device market was valued at $290 billion,roughly a third of the pharmaceutical market. The French market is estimated at $14.6 billionby SNITEM20, representing around 5% of the global market.17 The Removal of Inhumanity: The Three Rs, Russel and Burch, 1959 (http://goo.gl/jmP7C)18 Medical device regulations: Global overview and guiding principles, WHO, 2003 (http://goo.gl/acWMP)19 Medical Device Revenue to Top $300 Billion This Year, Kalorama, 2011 (http://goo.gl/8CNb0) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 15
  • 18. Over the last decades medical devices technologies have experienced an impressiveevolution contributing to the general improvement of healthcare. Amongst other, medicalimaging companies democratized the use of today routine machine, such as MRI or CT, andcontinue discovering new applications every day. The diagnostic process has becomeconsiderably more precise thanks to those technologies.In the same time the different technologies have not only converged between them but alsowith pharmaceutical ones. Diagnostic imaging firms, like GE Healthcare or Siemens, haveacquired in vitro diagnosis ones. Laboratories like Abbot, Roche and Baxter have developedstrong business segments in medical devices. Indeed medical devices technologies havekey advantages over their drug counterparts. Product development process last between 3 to5 years, compared to 10 to 12 years for a drug. Regulatory approvals are also less riskysince the majority of medical devices are not invasive.This industry has a higher potential than the pharmaceutical industry, to answer the healthchallenges including cost efficiency, care accessibility and diagnosis accuracy in order todeliver the most relevant treatments. And this trend is already observable in figures since thesector growth over-performs the pharmaceutical industry one21.From a responsible innovation point of view, the medical device industry is as critical as thepharmaceutical industry. Let us remember that old thermometers were made with mercuryinside. It is not before 1999, with a law forbidding marketing mercurial thermometers thandevice makers stopped manufacturing them. There is also a high concern about thedisposable character of some medical accessories. c) Payers: State is the primary payer and health insurances complete the offer.As an introduction to this part we will repeat that the scope of this work is limited to maturecountries and especially to France. Indeed in many countries it is left to the individual to gainaccess to health care goods and services by paying for them directly as out-of-pocketexpenses. On the contrary, in France, health is heavily funded thanks to the national socialsecurity, up to 75% for the Care and Medical Goods expenditure as detailed previously.The French National Health Insurance systemIn France the Social Security was founded just after the WW2, in 1945. The Social Securityincludes 3 branches: Health Insurance, Retirement Insurance and Family Insurance. Thepurpose of this system is to “guarantee employees and their family with a protection againstany potential risks likely to cut or suppress their income, covering maternal and familyexpenditures” (article 1)22. Before this date there were social insurances but they wereorganized by workers associations23. After 1945 those group claimed to keep the socialadvantages they already had.20 Le marché en chiffres des dispositifs médicaux en France, SNITEM, 2011 (http://goo.gl/MoV2R)21 Global medical device market outperforms drug market growth, M. Rosen, 2008 (http://goo.gl/5dIsn)22 Ordonnance portant organisation de la securite sociale, 1945 (http://goo.gl/oUS6R)23 Le financement du système de santé en France, WHO, 2004 (http://goo.gl/mNHup) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 16
  • 19. The National Health Insurance system is simple in theory. Every worker and employer has tocontribute via mandatory taxes to fill a national health insurance fund, as a proportion of thesalary earned or spent. In return those contributors could benefit from the health insurancewhen he or she will need care or medications. Solidarity is an important element of theFrench insurance system: the more ill a person becomes, the less the person pays. Figure 3 - Scheme of the French Health Insurance Fund in 2009Figure 4 presents how the French Health Insurance was financed and redistributed themoney in the health system in 2009. One important point is the asymmetry of this system.Indeed there are more expenses than income, and the deficit was about €11 billion in 2009.And it is a chronic problem even tough regular modifications have been made. At thebeginning, in 1945, there were no taxes to fund the Health Insurance. The CSG tax, basedon employee revenues, was only implemented in 1990. While expenses were still overtakingincomes the deficit had to be cover by debt. Then in 1996 the CRDS tax (Contribution toReimburse the Social Debt) was added. The same year the French government voteddifferent laws to help reducing health expenditures, including hospital reforms and efficiencyrules.Up to now the Health Insurance deficit remains an issue and the consequences have a realimpact over the whole health system. For instance states do not hesitate to put pressure onthe health industry, via regulatory agencies, in order to better control price, quality orefficiency of drugs and medical devices. Another tactic is to reduce reimbursement of somemedical products or care. For instance in the 1960, dental and optical care reimbursementswere strongly reduced. In that case the impacted stakeholders are patients because theyhave to pay out-of-pocket.In parallel to national health insurances, usually not covering 100% of health expenditures,people have the choice to subscribe a private health insurance. In 2008 92% of French werecovered by a complementary insurance, compared to only 69% in 198024 (Chart 4).24 La complémentaire santé en France en 2008 :une large diffusion mais des inégalités d’accès, IRDES (http://goo.gl/4S0xi) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 17
  • 20. Mutual Fund Private Insurance Contingency Fund French population 59% 24% 17% coverage Health expenditures 7,7% 3,5% 2,5% coverage Chart 4 - Health complementary insurances in France (source: DREES)In that kind of state-controlled health system with a population relying on a dominant NationalHealth Insurance, selling a health product is not that easy. The business model should eitherinclude a solid partnership with a payer (regulatory approval or private insurance partnership)or an inexpensive product for patients. It will definitely be an important point to describe. d) The patient: a forgotten end-userWe deliberately finish the description of health sector stakeholders with the patient since it isthe end-user and final beneficiary of the health system. The word “patient” originally meant“one who suffers”. We will portray patients under different angles. Sometimes patient, sometimes consumerThe patient is the receiver of any healthcare service, most often ill or injured. In comparisonwith other business sector, the patient could be considered as the counterpart of theconsumer. In reality fundamental barriers exists between a consumer and a patient. Bydefinition the consumer is the “economic agent who choose, (buy), use and consume a goodor a service”. In the health system the patient systematically differs from the decision maker(generally the prescribing doctor) and very often also from the bearer of the costs (generallythe health insurance system). Moreover the patient suffers from an asymmetrical level ofknowledge concerning health products and is dependent on health providers. Thischaracteristic causes divergent interests and a lack of clarity in relations between the healthactors. Pharmaceutical companies focus more on healthcare professionals and stateagencies than on patients (anyway advertisement toward patients is forbidden for them). Thesame way physicians hardly asked for patient opinions before treating them. In practicepatient is a passive player with no influence power.Things are moving and the patient role is gaining importance within the health system.Causes come from the inside and the outside. Within the system, due to pressure from thegovernment, patients are progressively educated. Education campaigns aim at rising patientawareness in the way they receive care and consume medications. For example, thecampaign to limit antibiotic usage succeeded in its purpose to control the misusage of thosedrugs. The reforms to improve patient health pathway gave people the responsibility tochoose a general practitioner and respect the procedure in order to be fully reimbursed. Moreover recent health scandals, like Servier’s Mediator case in France, have contributed toincrease a mistrust feeling among peoples. They claim for better transparency andcommunication from the health providers, the health industrials and from the healthcaresystem in general. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 18
  • 21. In the same time, changes come from outside the health universe. Large adoption of Internetamong households allows them to access a lot of information. They seek for information thatare often more objective. It is so true that seeking for health-related information activity onthe Internet is now comparable to e-mailing activity in term of spending time. Physiciantestimonials relate that some patients come and visit them with a pre-diagnosis or sometimescontradict their conclusion. It is obvious than people are becoming involved in the healthsystem and are gaining weight. The healthy, the ill and the entouragePatient’s group is far from being a homogeneous category. Because a patient is overall anindividual and because diseases are numerous it is tough to constitute sub-groups. Moreoverit makes a point to include healthy people into the patient group. Indeed healthy people arecontributing to the National Health Insurance fund. Indeed healthy people are also seekingfor health information and are potentially future patients. For example the preventive activityis clearly dedicated to healthy people aiming at keeping them healthy. Finally the patient’sgroup should also include sick persons’ entourage. Indeed a health problem directly impactsthe sufferer’s entourage, often its family, and they are willing to be involved. Minor diseasesor injuries softly involve the entourage. But if we consider chronic diseases the entouragebecomes crucial. For example an Alzheimer patient will be entirely substitute by itsentourage, becoming indirect sufferers. It is remarkable that this fact is hardly take intoconsideration by the health system but it is a major challenging point. 3- A big picture of the health sectorThanks to the detailed description of health players it is time to integrate them in the healthsystem. We will use the value chain model to understand the bases of relationship andcompetition between suppliers and provider. It will also be an ideal representation to highlightchanges and opportunities along the value chain.A traditional healthcare value chain has been established and popularized by Lawton Burnsin 2002, as represented in Figure 5. Figure 4 - The Healthcare value chain (source: Lawton Burns)This pattern shows 5 different categories of actors, 3 majors and 2 intermediaries. The firstone is the producers’ category. We have already analyzed those actors, includingpharmaceutical and medical equipment manufacturers. They are the innovation initiators and Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 19
  • 22. provide products and tools to healthcare providers. Those last, gathering hospitals (public orprivate), physicians but also pharmacies promote the consumption of health products. Theyprescribe medications and use medical equipment. They are the link between endbeneficiaries, patients, and health manufacturers. They bring value to products thanks totheir medical knowledge. Between producers and providers stood distributor intermediariesaiming at buying health products to the first category and sold them to the atomizedproviders’ category. Although healthcare providers can directly buy to producers, theintermediation of wholesalers makes possible to reduce costs of distributed goods whileincrease the buying power.At the end of the chain we find patients that are the end beneficiaries. There is here a bigdifference with other sectors since the payment is mainly indirect. Indeed payer bodies insurean intermediary role. Those payers are mainly governments thanks to public healthinsurances and private insurances in complement. Based on taxes and fees patients arecovered for the majority of health expenditures (medication and health care). Either they donot pay at all or they do and are reimbursed afterwards thanks to claims sent by healthcareproviders. At the end it appears that some health expenditures are not entirely covered andpatients have to directly pay to providers. This indirect payment pattern exists in the healthsector (remember that this study is focused on mature countries) to provide health to themany and avoid disparities by increasing the power of regulation.We can observe in this value chain that innovation goes from left to right and the money fromright to left. If we refer to marketing concepts health products are more pushed bymanufacturers than pulled by patients or providers. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 20
  • 23. Part 2 - When ICT meet healthNow that the health service universe has been described this second part will explains inmore detail the ICT world. ICT stands for Information and Communications Technologies. Itis important to understand the evolution of these technologies and how they are knocking atthe medical field’s doors. We will study in the first part the genesis of that convergence. Thenthe actors of this movement will be identified. 1- From Information and Communications Technologies to Connected Health TechnologiesNowadays the ICT acronym often refers to the Internet or telecommunications but as anextended definition it refers to all kind of data exchange between two or more entities. Forour purpose we will obviously consider communications between humans. History ofcommunication is as old as history of humanity. From cave paintings to 3G-mobile phones letus discover the exponential development of information and communications technologies. a) A short story of communications and its recent ramping evolution. Communication history milestonesFrom the origins, humans have communicated. For this purpose they created codes,languages and alphabets. Speech, hand signs, smoke messages, drums or writtendocuments: everything was good to carry messages.From the beginning: writing’s birthCommunication was first oral. It needed a constant interconnection in space and timebetween the transmitter and the receiver. The writing phase comes in a second time. It hasallowed a disconnected communication between the transmitter and the receiver in time andspace. This revolution represents the starting point of the Humanity story. Writing is the firstmilestone in the communication story.Writing story corresponds to two different kind of writing: ideographic writing and alphabeticalwriting. The first was born in Mesopotamia probably around three thousand years beforeChrist. Egyptians also used this mean of communication but improved it thanks to morecomplex signs called hieroglyphs. Phoenicians are inventors of the alphabetical writing(around 1800 years B.C.) but we have to wait until the Greeks to witness of an efficienttranscription of the spoken language. From this date, intellectual production has been deeplymodified thanks to writings and information exchange improvements were keys in the goldenage of antic civilizations. Knowledge was share and spread. Rhetoric was particularlyemphasized under the Roman period and then become a communication technique.Yet in antic society there were places dedicated to information and communication purpose.Agoras, temples or forums are some of them. Acta diurna were official daily publicationdisplayed in the ancient Rome walls to let citizens updated. Transport of messages was bothhuman (the marathon-man legend is the perfect symbol) and animal (for instance carrierpigeons). Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 21
  • 24. When the printing technology changed the worldThe next breakthrough and second key milestone in the communication story was thecreation of printing techniques by Gutenberg. The move from written documents to printedones match with the end of the Middle Age, a period of intellectual and social changes. Thefirst colored printed book was Psalmorum Codex in 1457, five years after the first printedever: the Bible (42 line version). It is estimated that in 1470 a printed Bible was 5 timescheaper than a hand-written one. Such a drop in the cost of knowledge allowed a larger partof the population to become informed. In 1464 Louis XI institutionalized the mail service withthe implementation of a royal mail enterprise. The newspaper as a source of informationappeared in the early 17th century. In France, in 1631, La Gazette was the first periodicnewspaper (N.B: La Gazette’s writter Théophraste Renaudot was the king’s personal doctor).Development of newspaper was then supported by improvements in transportation. At thebeginning of the 19th century the first steam vehicles appeared (boats and trains). Thisevolution did not solely allow people to move faster, it has also reshaped the human activity,created new kind of exchange, promoting new ways of thinking.The first telegraph, information dematerializationIn 179225, few years after the French Revolution, the third key milestone in the history ofcommunication is officially announced. The optical telegraph was born and its creator isnamed Claude Chappe. In 1844 Morse, well known for its code made of straight lines andpoints, sent its first telegram in the US. This period is contemporary with the emergence ofinternational press agency such as Havas (1835), Wolff (18949) or Reuters (1851). In thesame time a new communication support is invented: the photography. Two inventors are thefathers of this new technique, Daguerre (France) and Talbot (US) and it has been officiallypresented in 1839.The American engineer Graham Bell leads the world to a new communication area in 1876when he invented the telephone. Sounds can now be transmitted, remotely, through anelectric wire. In the late 1880’s regular telephone communications are available. Theseinventions are strongly linked to the rise of electricity.Just before 1900, the first radio message was exchanged by Marconi between England andFrance. This is the start for wireless communications. In 1895 the cinema was born(Lumières brothers). Information became available for crowds and the media industry grewup thanks to these new tools. Regular radio broadcasts appeared in the US in the 1920’s andthe TV experience was a success for the time in 1930. Thanks to communication satellites,launched in the early 1960’s it was now possible to broadcast TV shows on both sides of theAtlantic Ocean. The world has becoming a “global village”. Today’s communicationsAfter a slow but continuous evolution of communication medium, we could say that ICT haverisen exponentially during the last 50 years. Joseph Schumpeter, a famous economiststudied the Kondratieff cycle theory to understand economic trends. Thanks to their work 525 Histoire des Télécommunications, L’Internaute (http://goo.gl/PhWPj) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 22
  • 25. super-cycles have been outlined since the beginning of the industrial revolution, dozen yearsbefore 1800 (Figure 6). Figure 5 - Kondratieff waves and Schumpeter analysisEach of this cycle is characterized by a major technological breakthrough that has drasticallychanged the way human move, work, produce and exchange good and even make appearsnew ideologies and new ways of thinking26.As we notice on that chronological graph, we are right now living within the fifth super-wavethat started around 1992. Non-surprisingly the technological revolution that triggered this fifthcycle is the Internet27. In general, it is the booming of telecommunications that is thefundamental of the wave.And the movement is spreading faster than never in the whole History. From simple text andinformation exchange trough computers too big and too expansive to be owned by Mr.Jones, we are now able to share instant videos on smartphones.In diverse geographic areas, among different society classes, information is accessible for acontinuously growing number of people. Like the other major innovations that initiated the 4thprevious cycle, telecommunication revolution is changing the society, really deeply. For ourpurpose we will focus on 2 examples illustrating this change. Rise of social networks andnomadism.After an era when information was pushed to people we are now in a period when peoplepulled it. Thanks to the Internet there is an infinite source of information available. Andpeople have now to seek and select the relevant one. So they start to exchange data andinformation between them, in parallel to traditional information providers (companies, media,etc.). They are able to share, advice or critic information of interest for them. They can nowexpress their opinion to the world. This has led to the emergence and diffusion of socialnetworks that is the major breakthrough in mass communication over the last years. Yetmany business sectors have adapted their model to this new way of communication and aretrying to turn that bottom-to-top pattern into an opportunity. Surprisingly the health sector hashardly integrated that 2.0 communication scheme. But as seen before health awareness isrising and it is a real challenge to answer it.26 Les cycles du Capital, Jean Zin, 2000 (http://goo.gl/lKTU0)27 Tim Berners-Lee, Wikipedia (http://goo.gl/UjzYJ) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 23
  • 26. Nomadism is a second direct consequence of ICT revolution. Today people cancommunicate from everywhere and quickly. The rapid diffusion of mobile phone is the bestexample since even in poor countries this object is being common. Improvements in theelectronic field have made communication devices smaller and more powerful. In addition togive and receive calls it is now possible to surf the Internet with a mobile phone. In the futurethousands of daily objects will become connected. Another promising technology is the cloudcomputing. It means that data are stored in remote servers and accessible from anyconnected device. There is no need of large storage capacity but only high-speedconnection. b) Connected health technologies: E-health and M-healthIt has been only for a decade that Information and Communication Technologies have methealth. It is true that the health sector is complex, as developed in the first part of this reportand according to the US Institute of Medicine:“The challenge of applying information technology to health care should not beunderestimated. Health care is undoubtedly one of the most, if not the most, complex sectorsof the economy. The number of types of transactions (i.e. patient needs, interactions, andservices) is very large. Sizable capital investments and multi-year commitments to buildingsystems will be required. Widespread adoption of many information technology applicationswill require behavioral adaptations on the part of large numbers of patients, clinicians, andorganizations”.The first step was “connected health” which focused on increase efficiency of health servicesthrough connection of healthcare providers. Like companies in other business fields,hospitals started improving their efficiency thanks to the integration of IT systems. It is oftencalled E-health. The second wave, the core of our subject, is the rise of wireless healthsolutions, also known as M-health (Mobile health). Digitation of health information: E-healthThe health care system generally uses less ICT than other industries, but reports indicatethat providers are increasing their investments. The main use up to now is an “administrative”application especially in hospitals that are aiming at reducing costs and facilitatingcommunication. Those activities are also known as health information technologies. Themost frequent applications are listed in the Chart 5. Technology Definition This technology captures and integrates diagnostic and radiological images from Picture Archiving & various devices (e.g., x-ray, MRI, computed tomography scan), stores them, andCommunications System disseminates them to a medical record, a clinical data repository, or other points of (PACS) care. CPOE in its basic form is typically a medication ordering and fulfillment system. Computerized Provider More advanced CPOE will also include lab orders, radiology studies, procedures, Order Entry (CPOE) discharges, transfers, and referral. Bar coding in a health care environment is similar to bar-code scanning in other environments: An optical scanner is used to electronically capture information encoded on a product. Initially, it will be used for medication (for example, Bar coding matching drugs to patients by using bar codes on both the medications and patients’ arm bracelets), but other applications may be pursued, such as medical devices, lab, and radiology. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 24
  • 27. Health care organizations use EMM to track and manage inventory of medical Electronic Materials supplies, pharmaceuticals, and other materials. This technology is similar to Management (EMM) enterprise resource planning systems (ERP) used outside of health care. EHRs were originally envisioned as an electronic file cabinet for patient data from various sources (eventually integrating text, voice, images, handwritten notes,Electronic Health Record etc.). Now they are generally viewed as part of an automated order-entry and (EHR): patient-tracking system providing real-time access to patient data, as well as a continuous longitudinal record of their care. CDSS provides physicians and nurses with real-time diagnostic and treatment Clinical Decision recommendations. The term covers a variety of technologies ranging from simpleSupport System (CDSS) alerts and prescription drug interaction warnings to full clinical pathways and protocols. CDSS may be used as part of CPOE and EHR. Chart 5 - Common Health Information Technologies (source: Medpac)At first sight it is noticeable that technologies described in Chart 5 are more focused onimproving administrative and financial processes such as patient registration, billing, andpayroll, than on clinical applications. To be realistic the two last listed technologies, EHR andCDSS, which are real clinical application, are still at preliminary stages and much lessdiffused than the other above. In France there is a national EHR initiative called DMS28 (forDossier Medical Personalisé) that have been launched in January 2011. Initiators for the useof ICT in healthcare were naturally large organisms like hospitals or private clinic networks.Like in other business fields, the implementation of such systems allows to gain in efficiencyand as a consequence to save money. In smaller organisms it is still rarely implemented andconcrete benefit evidences are few. For example a PACS system implemented in a smallhospital could suffer from a lack of return due primarily to a low volume of imaging in thefacility. And it is important to talk about return on investment since integrating an ICT systemis very expensive.Among physicians, data about ICT integration in health practice are limited. But in general,like hospitals, physicians are more likely to use those technologies for administrativefunctions. The first barrier is the cost of required infrastructures. In France with healthadministrative reforms, such as implementation of Carte Vitale (chip-card used toelectronically record health-related transactions), almost every individual healthcareprofessional have installed a card-reader device to offer tele-payment. Another application ofICT in their daily practice is the use of Internet. This time it is more for clinical purpose.Adoption of health information technologies is obviously more difficult than in other business.Indeed healthcare professionals seem to be more reluctant, or focused on other subject thatcould improve quality and efficiency of their activity more directly. Actually there are no realincentives and no time to integrate complex ICT systems. The main challenge will be then toadapt ICT solutions to the healthcare complex environment in order to facilitate theprofessional use and finally the wide diffusion.Before continuing we could outline that E-health has bring responsible innovations to thehealth sector. Indeed, PACS systems have contributed to the extinction of conventionalradiographies films that used to be made of toxic components (silver salts).The digitization ofmedical claims have helped to reduce volume of paper used.28 Dossier medical Personnel, République Francaise (http://goo.gl/T6eAe) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 25
  • 28. ICT technologies applied to health described so far were mostly dedicated to healthprofessional. Does it mean that relevant patient dedicated applications are non-existent?Actually such applications exist but they are still few or still superficial (mobile apps forexample). Yet this is a really important innovation’s axe since we have seen the increasingweight of patients. Mobility of health: M-HealthMobile health is a sub-segment of E-health because it is based on technologies describedbefore. According to Triple Tree29, a venture capitalist firm focusing on this promising sector,M-health includes “any healthcare application or service that enables a seamless flow ofinformation across cellular, wireless, or other mobile networks and mobile devices thatimprove clinical care delivery, patient-provider communications, enterprise-wide mobility, anddecision support (patient, health provider, manufacturer and payer)”. We are here in the coreof our subject.The first support for mobile health solution development is the quick improvement of wirelesstechnologies and the diffusion among population and businesses. As mentioned previously,the massive use of ICT in many aspects of our daily lives has recently help the increase ofnomadism. More than many other technologies, mobile ones have the capacity to improvehealth systems. Major M-health solutions are for the moment mobile applications, from thesimplest like diet coach apps to more technical like blood pressure add-on from Withings30. Areport from Pyramid Research states that 200 million health mobile applications are availableto download on the different online stores at the beginning of 2011, and that figure couldtriple up to 2012. Another finding of their report concludes that “70% of people worldwide areinterested in having access to at least one m-health application, and theyre willing to pay forit”.To be more precise, Chart 6 identified a non-exhaustive list of potential possible healthoutcomes using wireless technologies.Solutions AdvantagePatient Documentation and medical safety at the bedside is a greenfield opportunity for m-healthSafety solutions. Medication and care errors at the bedside represent a multi-million dollar annual drain on the healthcare system. Solutions centered on patient identification and historical, dosage monitoring or process checking are enhanced significantly by wireless interfaces and devices that allow for ubiquitous access anywhere for inpatient and outpatient.Tracking & Stakeholders are beginning to leverage location-based tracking technologies providing anLocalizing ability to locate medical equipment and other healthcare assets while optimizing workflows. But mobile technologies can also help to localize individuals. Tracking the location of a patient during a treatment is a critical process for inpatient care and could be improve thanks to localization tools. In the case of ambulatory care or emergency situation the challenge is to locate health providers and resources. M-health solutions are highly relevant to tackle all these localization and coordination issues.Adherence Adherence is a challenge for a vast majority of patients and non-compliance to treatment isand both extra costly and a threat for medication efficiency. The reasons for non- compliance areCompliance multiples and proportional to the disease/injury complexity and length. Clinical trials, that are crucial for health industrials, also suffer from non-compliance. To cope with those problems innovations like wireless-enabled pill boxes and SMS reminder can lead to better health29 Wireless & mobile health, Triple Tree, 2009 (http://goo.gl/86o8J)30 Blood pressure monitor, Withings (http://goo.gl/PXBjh) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 26
  • 29. outcomes.Information Mobile Internet has spread the possibility to search for everything from everywhere.Access Concerning health information, dedicated application could allow clinicians to easily access information to improve decision making at the point of care. For instance, secured remote connection with PACS to send patient’s X-Rays or MRI images to any physician smartphones, In parallel new mobile applications could enable people to quickly record any health-related event. Crowd-sourcing and participatory healthcare system might be a major change in the near future thanks to mobile.Patient Remote patient monitoring have quickly become the poster child for M-health applications.Monitoring Firms such as GE Healthcare (Joint Venture with Intel) are addressing the needs of home health monitoring. According to many industry sources, the market for those services is currently over $3 billion and will grow to over $8 billion by 2012. Opportunities are huge with the ageing population and the increase of chronic diseases and home care. Remote monitoring is based on mobile connected devices, more or less sophisticated depending on the monitored constant. It allows informing concerned people (caregivers or patient itself) in case of adverse event but also store data. In addition, advances in sensor technologies allow connecting them wirelessly. The connected mobile health device will become wearable or even implantable.Remote Scarcity or limited access to care providers is a persistent problem within the healthcarePresence system, especially in remote and congested metropolitan areas. Companies are working toand Robotics solve this problem through the use of remote presence. Telemedicine and telesurgery are ones of the best examples, mixing wireless connections and robotics. It will be possible for physicians to be multiple places at once, extending their reach and decreasing time to care. The other potential of smart connected robotics will be to support impaired or disabled people. Helping disabled people to move, blind to see or deaf and dumb to communicate. Chart 6 - Potential outcomes for M-health solutions (source: Triple Tree)Among all those M-health opportunities we will see what are the most relevant and how todesign a pertinent business model. This identification will be conduct in the third part. 2- Different players from different background in the M-health universeE-health is, by nature, aggregating players from both worlds. M-health environment is alsocomposed of lots of actors that can be classified into 5 categories. i) Device manufacturers ii) Infrastructure builders and telecom operators iii) Healthcare Service providers iv) Payers v) PatientsThe three last actors have already been detailed in the first part of this paper so we will focusmainly on device manufacturers and telecom operators. Indeed device makers not onlyinclude medical device but also general electronic device makers. Healthcare providers,payers and patients will be quickly reviewed from a M-health point of view. a) Consumer electronics manufacturersWe already described the medical device industry in the first part of that report and wenoticed that it includes a tremendous number of products or equipment. The sector is at leastten times wider if we consider the larger group of devices and appliances. Yet in M-healthsector all sort of device makers won’t be interesting. In fact the ones that could join the M-health adventures will be mainly the consumer electronics manufacturers. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 27
  • 30. Consumer electronics are electronic equipment intended for everyday use. The first majorconsumer product, the broadcast receiver, appeared in the early 20th century. Later theconsumer electronic industry has invented personal computers, telephones, music players,audio equipment, televisions, calculators, digital cameras or again players and recordersusing video media such as DVDs. According to the Consumer Electronic Association (CEA),the 2010 global industry revenue was of $873 billion31, and is expected to grow to $964billion in 2011, i.e. a 10% increase.The industry is historically centered in Asia with countries that have become specialists inthis particular sector like Japan or South Korea housing some of the biggest players. Giantsin the sector are named Panasonic, Samsung, Mitsubishi, LG or Sony in Asia, Philips orApple in Western countries.Electronic devices have massively integrated the daily lives of people because they weresubjected to continuous decreasing prices. Based on electronic technologies, those productsfollow the Moores Law, which states that microprocessor speed doubles every 18 months.Consequently the innovation pace is faster than in any other industry with new technologies’announcements every time. By changing the way people communicate, share information,and entertain themselves, consumer electronic products become a part of the culture. Theworld was different before television. It was different before radio, before cell phones, andbefore CD players.Consumer electronics are today undergoing the integration of ICT technologies. The trend isto make products connected and at the end create bridges between different technologies.With each passing year, and each new generation of products introduced in the marketplace,its getting harder and harder to differentiate companies and their products into traditionalcategories like telecommunications, computer hardware, and consumer electronics.Consumer electronics tends to be Swiss knifes. In addition to become connected thoseproducts are also becoming mobile, answering the fantastic evolution of human behaviors.The phone‘s history perfectly illustrates those evolutions. At the beginning phones used to bephysically linked with wires to communicate between them and be supplied in energy. Thenthey lose the wire and became mobile, including batteries. Later they enabled people toexchange short texts. Camera technologies were soon added and image exchange wasmade possible. Finally they were able to be connected to the Web, sharing all kind of dataincluding video. They are now called smartphones.Mobile phones are obviously among the most promising products for the development of M-health. According to the International Telecommunication Union32 the mobile phone globalpenetration rate was of 76% in 2010 with 116% in the developed world (more than 100%means that some people owned more than one mobile phone) and 67% in the developingone. Webphones are still more promising for M-health sector and was used by 13% of theworld population in 2010 (51% in developed countries, 5% in developing countries). Thisextraordinary diffusion will allow the mobile phone makers to vastly provide people withhealth-related solutions.31 Global Consumer Electronics Retail Sales Seen Up 10% In 2011, Forbes, 2011 (http://goo.gl/hJc0t)32 Key Global Telecom Indicators, International Telecommunication Union (http://goo.gl/FDBFK) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 28
  • 31. Over the last years the consumer electronics industry was exposed to the issue ofsustainability. Because they are widespread and based on electronic technologies thoseproducts represent an increasing part of energy consumption. For example there is aparticular issue with the standby power assumed to significantly increase the energy bill.Another problem is the fast rhythm of obsolescence striking consumer electronictechnologies. Integration of reusable material and recycling process are more and moretaken into account by innovators. b) Infrastructure builders and telecom operatorsThis category includes all the actors that are supporting the ICT sector, thanks toinfrastructures (networks and storage capacity) or services (telecom operators, softwareproviders). They are essential in M-health since they grant mobile devices to be connected. Telecommunication network buildersBasically a telecommunication network is a collection of terminals, links and nodes whichconnect together to enable telecommunication between users of the terminals. Terminals aremade by device makers. Links are the channels by which data is transmitted. They can bephysical (copper wires, fiber-optic cables) or immaterial for the case of wireless networks. Inorder to be transmitted through links, messages have to be converted by terminals intodifferent form of signal including radio frequencies, electric signals, light signals (infrared).Nodes are necessary to handle messages and route them down the correct link toward theirfinal destination.Protocols and standards are fundamental in networks and define how initial data is encodedthen transmitted throughout the network. For example the Internet protocol is called TC/IPprotocol. In mobile network there have been 4 categories of standards. The 1G network wasthe first automated cellular network implemented in 1979 in Tokyo. 2G standards appearedin 1991 in Finland. The 3G network was launched in 2001 in Japan too. Finally 4G standardsare available since 2006 but really implemented in few countries on the edge. Each of thesegenerations has increased the bandwidth thanks to more powerful satellites and antennas. Telecommunication operatorsTelecommunication operators are the companies performing the exploitation of networks.The first players, chronologically speaking, were the phone operators. Then Internetproviders came in, rapidly acquired by phone operators. Finally they are the ones who ledthe invention of mobile phone networks and added this activity to the fixed phone andInternet networks’ exploitation. In reality they provide a service: they allow people to properlyuse the telecommunication network. And this service is worth to be paid. When we arepaying for a mobile phone subscription we are actually buying the right to use a part of thenetwork, for a certain time. Mobile Subscribers 2010 Original Market Additional markets Operator (million)1 China Mobile China Pakistan 6272 Vodafone United Kingdom Middle East, Commonwealth, Europe 3613 Telefonica Spain Latin America, Europe 2274 America Movil Mexico Latin America 2365 Airtel India Bangladesh, Central & Austral Africa 221 Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 29
  • 32. 6 Orange France West Africa, Europe, Middle East 2177 Telenor Norway North & East Europe, South East Asia 2038 VimpelCom Russia South East Asia 193 Chart 7 - Main mobile phone operators (source: Wikipedia)Chart 7 lists the 8 major players worldwide. As networks are without frontiers it seems logicalthat the players, that are relatively young if we consider that this market did not exist before1980, are global players. Now 3 humans out of 4 owned a mobile phone.With access to an incredible pool of consumers, mobile phone operators could have alegitimacy to play a predominant role in M-health. This is the reason some companies havestarted targeting the field. For instance Orange, the 6th global player in term of subscribers,have created a dedicated branch in 2007 called Orange Healthcare. To build their strategythey particularly focus on partnerships and for example in France they partnered with GEHealthcare to deliver the biggest medical imaging connected platform for 30 hospitals aroundParis.Now that mobile broadband technologies exist (wireless Internet access) mobile phoneoperators provide it through additional subscription premiums. The InternationalTelecommunication Union estimated almost 1 billion mobile Web users in 2010 and predictsthis figure to double within the next 5 years, overtaking the PC as the most popular way toget on the Web. Software providersThe mobile health sector also counts on actors that are providing the digital content.Software is the main content used on mobile devices. A software allows the machine toperform computer tasks and overall assist the user to run this task on its machine. Softwarewill be necessary coupled with future mobile medical devices and, as we will see after, will becrucial to improve the user experience (patient or physician). Appropriate software will allowto increase ease-of-use and, as a consequence, adoption of such technologies. Microsoft isthe most know software player for consumers. And IBM has become a software companywhen it decided to stop the selling of hardware products. Those software companies areknown in the health sector to have provided enterprise management software for physiciansand hospitals. Software companies are finally the ones being on the edge of M-healthbecause they are the creators of million available health-related mobile applications.Besides machine software we can also find Internet software that is marketed by famouscompanies. And those actors are highly interested by M-health since a lot of connectedhealth devices will be linked to the Internet. For instance Google had launched the GoogleHealth portal in 2008, offering Web-based medical records to patients. This solution hassince been abandoned. Microsoft HealthVault33 by Microsoft is the same solution. c) Healthcare stakeholdersHealthcare providers, payers and patient were all depicted in the first part but we could addsome comments, related to their willingness and readiness to be active players in M-health.33 HealthVault, Microsoft (http://goo.gl/47R0i) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 30
  • 33. Healthcare workforce is made of individuals already using mobile solutions and the Interneton a daily basis. Technologically it won’t be a problem. A recent study commissioned byGoogle34 (November 2009) reveals that 86% of physicians are already using the Web forseeking health information and amongst them, 59% have performed the search on a mobiledevice.Patients are again much more willing to play a role in M-health. The Internet has alreadygiven them the power to enhance their influence within the health system while improvingaccess to information. Now they want to be able to know about their own health, in detail,and got the possibility to act by themselves, to gain autonomy. They are in huge demand.Finally governments and payers are also expected to stand a major role to promote M-health. Actually they rule the health sector, in France especially, so nothing could be doneeasily without their support. d) A big picture of the M-health.Thanks to the previously done description of different stakeholders we are able to draft a M-health diagram (Figure 7). Figure 6 - M-Health EnvironmentAll the actors, Device Mobile Makers and Infrastructures and Telecom Operators have to beunderstood by medical devices manufacturers. Indeed they can be seen as competitors orperfect partners to take the lead on the M-health industry. We will discuss the legitimacy ofthose different players on the M-health battlefield further.34 Connecting with Physicians Online: Searching for Answers, ThinkHealth with Google, 2009 (http://goo.gl/nVFXy) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 31
  • 34. Part 3 - Which potential markets to target and business models to design?Now that we have described in one hand the health universe and in the other hand the ICTworld it is time to deal with the core of our subject. Which specific parts of the vast healthsystem could be targeted with M-health solutions? How to build appropriate products for theconcerned actors? How give value to those products? To do so we will first identify majortrends, major phases susceptible to accept mobile applications. Based on this identificationwe will give take away about the necessary features that should be integrated in M-healthsolutions. We will then detail how to build integrated solutions and sell them in practicethanks to partnerships. Finally we will conclude by having a step back and look from adistance those M-health solutions. The aim of this last point is to raise awareness and makefuture M-health players being responsible innovators. 1- Understand the healthcare pattern and identify key changing factors a) Education/prevention, diagnosis, therapy, post-treatment monitoringTo address a relevant health service/product integrating wireless technologies it is necessaryto understand how healthcare is provided, as a complement to the healthcare systemanalysis that was already done. 4 different phases can be identified in the healthcareservices activity. i- Education and prevention ii- Diagnosis iii- Treatment iv- MonitoringThese phases are often performed by different health players and targeted populations aredifferent. Education and preventionEducation/prevention is the first mission of healthcare providers. This activity is oftenunderestimated although it is a really crucial one. Indeed this activity represents a small partof the health costs and is hardly considered as decisive. It is probably because people thinkprevention or education do not have a direct impact. They just enable more healthy people tostay healthy. As a general matter, as we have seen in the first part, health in western worldused to be curative more than preventive.Prevention can be divided into 3 categories35. First prevention focuses on reducing diseases’prevalence (vaccination for instance) and modifying population behavior (fight againstalcohol or tobacco). Second prevention aims at lowering the severity of unavoidable35 Santé et prévention en France, GSK (http://goo.gl/mGLxy) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 32
  • 35. diseases thanks to early diagnostic. Third prevention occurs when a disease is alreadydeclared in order to limit complications.According to those definitions, prevention/education activities imply consumption of drugsand medical equipment but overall information and communication.In mature countries prevention is mainly supported by public health institutions. In 2009, forFrance, prevention cost represents €6.2 billion compared to €223 billion spent for health ingeneral36. This general account includes mainly healthcare or medical equipment spendingand information or communication activities are minor. The most important communicatingand launching awareness campaign organism is INPES (Institut National de Prevention etd’Education pour la Santé). Its budget in 2009 was around €104 million37.Prevention and information are the first actions implemented in very poor countries in orderto tackle with health problem. Vaccination campaigns, awareness campaign for women,etc… In a mature country such as France, health education level is higher and preventiontries to fight other health problems like tobacco addiction or obesity. Observers noticed a riseof interest for health and well-being among population. This trend is parallel to a moregeneral movement: people are willing to manage their life instead of remaining passive.Health used to be an occult matter impacting lot of people but being inaccessible for crowds.Today it is a subject of high interest for the same crowds and people became active healthinformation seekers. Just one figure, according to the 2011 Pew Internet Project38 study, 80% of internet users look online for health information, making it the third most popular onlinepursuit among all those tracked, following email and using a search engine.But prevention and education is also a relevant topic toward professional healthcare thatoften used to be solely informed by manufacturers themselves (pharmaceuticals and medicaldevice). Today they are willing to share, to better understand and to be more objective faceupon those manufacturers. The accurate information that a physician need obviously getmore added value than information a normal person need.At the end we understand that answering the trend of education and prevention is not thecentral element of mobile health solutions to be developed by medical devices companies.But it is unavoidable to integrate it. DiagnosisThe diagnose phase appears when a symptom or an abnormality is detected and need to beidentified. It comes from the greek word diagignoskein meaning to discern or distinguish.Diagnosis is the key part of a physician’s job. To perform a good diagnosis the physicianpossesses a high level knowledge in anatomy (body structure), physiology (body machinery),pathology (failure in anatomy and physiology) and psychology (thought and behavior). Froma diagnosis it is possible to propose a treatment and plans for follow-up.36 Dépense courante de santé en France, IRDES, 2011 (http://goo.gl/FWd3e)37 Agences et organismes sanitaires en France, M .Bapt, 2011 (http://goo.gl/DBwOA)38 Survey, CHCF, 2011 (http://goo.gl/Skj4u ) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 33
  • 36. This diagnosis phase has known a spectacular evolution all along the 20th century, especiallythanks to advances in medical imaging and bio analytical tests. This phase is an essentialtarget for medical devices manufacturers.Diagnosis can be performed by simple examination of a patient or thanks to the use of basicequipment like stethoscope. This is true for simple or common disease like flu or cough.When an illness is more complex and that symptoms are not obviously visible more technicalequipment is needed. We won’t detail every technique but thanks to medical imaging it ispossible to obtain a precise picture of our inner. Slice imaging is able to give a 3D image ofalmost every kind of tissue. Coupled with biomarkers, it is now possible to see part of organsthat used to be invisible. Thanks to bio analysis we are able to detect abnormalities in body’ssamples (urine, blood, tissues, etc.). We called it in vitro diagnosis.A lot of improvements have been made in the diagnosis phase for the benefit of treatmentphase. It is logically comprehensible. When a disease is better distinguished, betterdifferentiated, it is possible to address a more accurate treatment. When an abnormality isbetter characterized, better classified, it is possible to address a personalized cure. One ofthe main goals today is to diagnose as early as possible. Then treat when the disease is nottoo severe.The challenge for the future will be to diagnose sooner, increase examinations efficiency andprovide accurate abnormality identification for crowds. Difficult diagnosis will be stillperformed by on-site experienced physicians. But basic diagnostic, for common diseasecould be done by patients themselves or a third party, and confirm after by a physician. Itopens a white space for mobile health devices. TherapyTherapy is the third step in the healthcare process, and it is the most visible part. Physiciansare also known as therapists. Originally it is a Greek word meaning “remediation of adisease”. Synonym of treatment, the main objective of a therapy is to recover a patient froman illness or impairment. If a therapy leads to the definitive elimination of a disease orrecovery of impairment it is called a cure.In parallel to diagnosis, therapeutic tools were improved a lot during the last century.Therapeutic tools include drugs and medication but also surgery methods. This is firstbecause of tremendous biology advances that spread our knowledge in physiology at acellular and molecular level. The biotechnology rise is the most obvious illustration of whatwe can do now. The second cause of such an explosion was the rise of chemistry sciences.It was made possible to create molecule that targeted or tackled problems identified thanksto biology. Finally, electronic improvements lead to medical equipment innovations includingsurgery equipment and medical equipment (pace maker or stents for instance).Therapies’ outcomes are not 100% predictable then it is important to assess what it is calledthe benefit/risk balance. In addition to adverse effects that are intrinsic limits to therapeuticmethods there is also a risk when a treatment is not well implemented. Medicationmanagement is an identified issue and according to the International Council of Nurses39,39 Les erreurs de médication : une étude du CII, CII, 2009 (http://goo.gl/v9g8E) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 34
  • 37. 60% to 80% of healthcare adverse effects are due to human errors. Moreover patientadherence to a treatment is also problematic. The WHO reported40 that in developedcountries, only 50% of patient suffering from chronic disease follow treatmentrecommendations.Medical devices are often the tools that allow administrating drugs and medication. Here is ahuge opportunity for medical device manufacturers to respond the problem of medicationmanagement creating smart and connected technologies preventing errors to occur. Post-treatment monitoringPost-treatment monitoring aims at insuring the efficiency of a treatment, so by definition it isthe last phase of healthcare service. It consists on tracking different variables that wereimpacted by the disease or were likely to be modified by the treatment. In this phase we alsoinclude treatment monitoring in the case of long term therapy applying for chronic diseases.In general terms, monitoring is seen as a set of captors linked to screens or boxes, ringingwhen something unusual is happening. This simple vision is a quite good definition ofmonitoring. But this example is what we called continuous monitoring. In reality monitoringdoes not only implied continuously plugged devices. For example when a diabetic control hisor her blood sugar level with a glucose meter it is a pinpointed monitoring. When a physicianasks his or her patient to do a blood checkup once a year to control his or her cholesterollevel, it is also monitoring.Post-treatment monitoring is crucial because it allows assessing the therapy’s efficiency andin case of problems it gives the possibility to react quickly, prescribe another treatment oradjust it. Vital importance of monitoring applies mainly during and after surgical interventionsand for chronic diseases. During surgery it is important to monitor how organism does reactto internal modifications or anesthesia. After a surgery patients go in intensive care units,depending on the severity of the intervention, to insure vital signs stability. Concerningchronic diseases, monitoring is used to check severity evolution.The monitoring activity involves using specific devices provided by medical equipmentcompanies. Those tools are made of sensors or captors detecting different signals (heartbeats, oxygen concentration, etc.) that are usually displayed on a screen and can bechecked and interpreted by healthcare professionals. It is both constraining for patients andfor healthcare providers. Today two factors are challenging monitoring device manufacturersand mobile solutions are highly relevant.In one hand we have post-operation monitoring that need to maintain the patient insurveillance period. During this period the patient is plugged to different kind of machines,consuming time and space, until his or her state become stable. In order to reduce costs ofsuch a service, that is a necessity and a part of health professional’s responsibility, weobserve an increase of home hospitalization. In fact it means that patients return back earlierto their homes, benefiting of an in-house hospital service. In France this kind of solution iscalled Hospitalisation à Domicile (HAD). Obviously that kind of service required reliable and40 Adherence to long term therapies: Evidence for action, WHO, 2003 (http://goo.gl/eQYQ9) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 35
  • 38. connected monitoring devices transmitting information to healthcare professionals not basedalongside the bed.In another hand chronic diseases need to be better tracked and in a more uninterrupted way.But because patients suffering from chronic diseases are often mobile, monitoring devicesshould be adapted to their lifestyle and being less constraining. Mobility and ease of use arekey arguments to deliver pertinent solutions. b) Targeting the real challengesIn this part we will try to depict the most important issue that the health system is facing andselect the ones that could be answered with mobile health solutions. First challenge for thehealthcare system: there is an increasing number of people to provide care to, with limitedresources (financial, human). The link between health and demography was briefly pointedout in the first part of the report. Now we will define more deeply the consequences of suchunbalanced demography on the healthcare system. The second challenge is the modificationof people’s behavior and the rising of health awareness changing the influencer map. Thethird challenge is chronic diseases that have a deep impact (qualitative and quantitative) overpopulations and societies. Unbalanced demographyBaby boomers used to be the generations that were born between 1946 and 1973, after theSecond World War, in mature countries (Graph XX). This exceptional birthrate boom hasfeed what is called the Glorious Thirty mainly in European countries. A fantastic increase ofyoung population to rebuild those countries has led to incomparable growth until the first oilcrisis in 1973. After this period birthrates have decreased and countries now hardly succeedin renewing their population. Graph 2 - Age Structure Diagram, France 2010 (source: INSEE)Impacts are multiple for health systems. We saw than in the health sector, expenditures areprincipally covered by National Health Insurance. Yet active population, i.e people who Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 36
  • 39. works, funds those insurances. Papy booming, the adverse effect of baby booming, that weare experiencing now, contribute to a reduction in the number of Health Insurancecontributors. Figures from the French statistics department (INSEE) in Chart 8 are here tosupport that point. Date 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 Total Population 42,0 45,9 51,0 54,0 56,9 59,3 63,1 66,0 68,5 70,7 72,3 (million) Over 65 (million) 4,7 5,3 6,2 7,5 8,0 9,6 10,7 12,7 15,2 17,4 18,2 Percentage 11,3% 11,5% 12,1% 14,0% 14,1% 16,1% 16,9% 19,2% 22,2% 24,6% 25,1% Active population 24,7 26,0 28,1 30,1 33,2 34,6 37,1 37,5 37,5 37,5 38,0(21-65 y.o) (million) Percentage 58,9% 56,5% 55,1% 55,7% 58,4% 58,4% 58,7% 56,9% 54,7% 52,9% 52,6% Retired/Active 4,9 4,6 4,0 4,1 3,6 3,5 3,0 2,5 2,1 2,1 2,1 Ratio Chart 8 - French population forecast (source: INSEE)The chart’s last line is easy to understand. It means that in 1960 5 active people used tosupport one retired person. At the end of the decade, the ration will fall to 3 active people forone retired people. In 2060, still according to INSEE forecasts, one retired citizen will only befinanced by 2 active French workers. At the end, for every new active worker the weight ofretired people funding is heavier.To be clear demographic unbalance is a real burden for the health system and it needs to betackled thanks to relevant solutions. After describing the health insurance system in part onewe remember that it shows a deficit, bigger year over year because of debt’s interests. In onehand politics are trying to change the rules of social contribution. It means they are trying toincrease incomes for the National Health Insurance while the number of contributors isshrinking. In the other hand they are focusing on reducing health expenses. Cutting healthrelated costs is the Holy Grail for governments. For that specific financial challenge the mostimportant thing is to improve efficiency of health services.We already noticed that E-health solutions were particularly promising to improve hospitalsand physicians efficiency. If it is still based on few evidences, there is no doubt that thosetechnologies will positively impact the health sector, like they did for other business sectors.Mobile technologies are likely to be even more efficient.Hospitals are like big machineries. In those places we could find a myriad of jobs andactivities almost like in a common for-profit enterprise. The main purpose is obviously toprovide healthcare. A hospital is a place opened to anybody. People in need of care have tobe looked after by health professional. Hospitals teams are often under-staffed and thenoverwhelmed. Mobile solutions could be perfect tools to coordinate health workforce andmanage patient and professional flows. The best example is the RFID (Radio FrequencyIdentification) technology. RFID tags are able to communicate wirelessly with specificreceptors and could be as small as chips. Those tags, carried by patients or health workerswill allow localizing their position at every moment. Information about their movements andtheir activities will be tracked and could be analyzed to improve workflows. The same RFIDtags are already used to track equipment in hospitals, to find them easily, make inventories Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 37
  • 40. and avoid rip-off. Pilot project have also used RFID technologies to set up automatedhospitals’ pharmacy.In term of impact on health system, people over 65 years old represent 40% to 50%41 of totalhealth expenditures in OECD countries. The real challenge will not be to reduce health costsrelated to old people but only to limit them. The main question is: how could we reduce theimpact of elderly? With age health problems are more frequent. And old people progressivelybecome less independent. Independence is a major problem because it implies social care.As described in the first part health associate workers guarantee this social support most ofthe time. Mobile solutions could support them fantastically. In fact wireless medical devicescould empower dependent persons. Most of the time medical-social workers are demandedfor basic problems. The idea is to developed smart equipment that could support dependentpeople or help entourage to perform easy cares. Smart pillboxes or connected wheelchairsare great examples. For instance a mobile digital application mixing tutorials, videos andother multimedia content installed on a touch screen device could be delivered to thedependent people and its entourage.Undoubtedly the best way to limit age related health expenditures is to make old peoplebeing healthy as long as possible. For that purpose the best solution is to inform people andincentive them to take care of their health capital. As mentioned before, millions of mobileapplications are already available. But the one dedicated to senior are still few. Help elderlyto undergo regular health checkup allowing early detection and diagnosis is an example.Create remote information centers to reassure worried aged people, advise them and avoiduseless consultations. For the prevention or at least stabilization of Alzheimer disease,forecasted to strike 1,3 million French42 in 2020, it has been outlined that mental exercisesare really efficient. The widespread of digital tablets is excellent for the diffusion of interactiveapplications, scientifically designed, aiming at training Alzheimer disease subjects.The biggest problem concerning this aged population will be to adapt devices. They are notfamiliar and are reluctant to use it. For them the human contact is the only valuable process.Key word will be “ease of use”. Chronic diseasesChronic diseases are diseases of long duration and generally slow progression. By definitionsuch diseases have no foreseeable cure and if poorly managed typically lead to further,complicated secondary health issues. According to the WHO they are by far the leadingcause of mortality in the world, representing 63% of all deaths. Out of the 36 million peoplewho died from chronic disease in 2008, nine million were under 60. We can classify thefollowing diseases, amongst other, as chronic ones: • Cardio vascular disease • HIV • Chronic respiratory disease (asthma) • Severe muscle-skeleton disease • Mental disease • Mucovisci • Diabete • Tuberculosis • Blood Pressure • Multiple sclerosis41 Dépenses de santé, quel avenir ?, L’Observateur de l’OCDE, 2001 (http://goo.gl/uhxI8)42 RAPPORT sur la maladie dAlzheimer et les maladies apparentées, C. Gallez, 2005 (http://goo.gl/75idv) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 38
  • 41. • Cancer • Rheumatoid arthritis • Neuro degenerative disease (Alzheimer, Parkinson)In France those disease are officially classified as Affection Longue Durée (ALD) since 2004and are specifically considered in the health system. Patient suffering from 30 short-listedchronic diseases (ALD 30) are ruled by specific laws and regimes. Those patients are 100%reimbursed for care and medication that should be taken for a long period of time. Oneimportant point is to measure the weight of those ALD patients compared to the rest of thepatients.In fact the most problematic consequence of chronic diseases is that they are really costly.Because they are long-term and often non-definitely curable, a patient suffering from achronic disease will regularly consume medication and care, simple or complex. A 2009report of French Health Insurance43 give figures that could help us to apprehend thatimportance. In December 2008, 7.9 million French suffered from ALD 30s, 3.5% more thanthe previous year. Those 8.3 million people represented 14% of National Health Insurancecontributors while concentrating 34% of all health insurances costs (Chart 9)! Population Proportion of Proportion of total Cost total Health ALD striken (million insured population* Insurance (billion €) people) costs**Cardiovascular Diseases 3,1 5,5% 21,1 12,7% and strokes Tumors 1,7 3,0% 14,3 8,6% Diabete 1,6 2,9% 9,9 6,0%Severe Mental Diseases 0,9 1,7% 5,3 3,2% 4 first ALDs 7,3 13,1% 50,8 30,5% Other ALD 30 2,4 4,3% 19,2 11,5% Total ALD 30*** 7,9 14,1% 56,4 33,9%* Estimated 56,5 million, ** €166,2 billion in 2008 *** Sums are not simple sums because some patient experience multiple ALD Chart 9 - Weight and cost of ALD 30s for the French Health Insurance (source: CNAMTS 2008 and 2009)Before going further the report also highlights that there is an increasing number of multiplechronic disease patients. Indeed some chronic diseases often lead to other chronic diseases.The average number of chronic diseases among ALD subjects was 1,22 in 2008 (Thisnumber explain that sums in Chart 9 are not equals).In more detail 4 chronic diseases are particularly important and represent most of costs asmentioned in Chart 9. Is there open space for wireless health devices to help treating thosechronic diseases? And how can they be relevant?Cardiovascular diseases and strokesCardiovascular diseases category include different pathologies involving heart or bloodvessels (arteries or veins). Although cardiovascular disease risk is individual-dependent(some people are likely to experience heart failure without any reason) the main factorleading to such a disease is the behavior. For example obesity is often assumed to be a43 Les personnes en affection de longue durée, CNAMTS, 2009 (http://goo.gl/oK9NV) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 39
  • 42. particular negative initiator of cardiovascular diseases. Sedentarity and unbalanced diet arealso likely to provoke heart problem. Today lots of methods exist to treat heart problems oratherosclerosis ones, thanks to drugs or surgery. Pacemakers or valves implants to fix heartimpairments. Stents or medications to cope with arterial problems. A stroke, also known ascerebrovascular accident, is due to disturbance in the blood supply to the brain. It results toneurological damages in brain zones that have been non-irrigated, leading to the loss of oneor several human functions (speech, paralysis, etc.). Risk factors for stroke includehypertension, previous stroke, diabetes, high cholesterol and cigarette.In the future, M-health solutions could potentially help facing cardiovascular and strokesevents. Because those diseases are mainly the consequence of unhealthy behaviors, oneobvious solution could be to better educated people. Mobile media could help increasingpublic awareness and make them adopt better way of life. As often said “the sooner thebetter” so one interesting target will be child and teenagers. Make health being a game is arelevant method to implicate people. With mobile health applications that are connected tosocial networks, people could be emulated and more motivated to practice sports, to eat well,etc.Wireless technologies are also pertinent to improve cardiovascular treatments. For examplewearable sensors could help monitoring and tracking heart beats while providing continuousrecords for heart insufficiency people. The same way pacemaker remotely connected willimprove the monitoring of implanted patients. The first Internet connected pacemaker implantwas realized two years ago, in 200944.Finally mobile health could help for rehabilitation of strokes. Impaired functions could bebetter supported. For instance specific devices can allow face-paralyzed people tocommunicate with their entourage.CancerAt physiological level, a cancer is the exponential growth of disorganized cells. Sometime ittake the form of a tumor, sometimes it’s hidden. Sick cells can spread in the body thanks tolymphatic system and bloodstream. Identifying cancer causes is complex, because it ofteninvolved different factors. Nevertheless many things are known to increase the risk of cancer.This is the case of tobacco use, radiation, lack of physical activity, poor diet andenvironmental pollutants. There are also heredity reasons, breast cancer being a perfectexample. Finally age is a common factor of cancer development. With age, cells lose theirability to destroy themselves. In general cancers are multiform and result from multipleconverging factors. The common characteristic for all of them is that it is a cell proliferationprocess.The contribution of mobile solutions will be at different level. For medical device makers thechallenge will be to diagnose cancer as early as possible. The aim is to stop cell proliferationas soon as possible and avoid malign cells spreading. Massive screening is already a realityfor breast cancers. We could imagine portable appliances that allow quick detection ofmalign tumors. For examples skins tumors are easily accessible because they appear insurface. Smartphones coupled with a dedicated application could be used as diagnostic tool.44 First Wi-Fi pacemaker in U.S. gives patient freedom, Reuters, 2011 (http://goo.gl/Uq2Yt) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 40
  • 43. A patient will take a photograph of an abnormal beauty spot and get an automated diagnosis,or send the picture to a pool of specialists that will give a diagnosis.Finally mobile applications could also help patient’s entourage. Cancers are long term illnessand rise worries among families and relatives. And it has been proved that positiveenvironment could help sufferers to fight cancer. Being able to follow the state of a loved oneand support it could be positive any patient.DiabetesDiabetes is one of the most addressed chronic diseases so far. The daily life of a diabetic isrhythm by regular blood sugar level tests and insulin injections. The diabetes management istoday mainly performed by the patient itself. Regularly the patient and its physician have toreview how the disease is evolving, but the patient is autonomous in the daily practice.Wireless solutions are definitely capable of improving this process. A portable device willeasily check the blood sugar level and deliver the right level of insulin that the diabetics willhave to inject. Everything could be recorded and analyzed at any moment by the physician.That kind of device, called Diabeo45, has been launched in France in 2008. c) Home care servicesIn response to health expenses increase, homecare services seem to be an efficientsolution. The most promising application for home care is to follow-up and recovering care.According to a 2007 comparative study from IRDES46, a HAD (Hospitalisation à Domicile)day costs in average €169 compared to €263 for similar care services in hospital. AnotherIRDES report47 point out clinical evidences in favor of homecare. Among others homehospitalization reduces the risk of nosocomial contaminations and has positive impact onrehabilitation length. Up to day home hospitalization represent a marginal part of allhospitalization, around 1%, but the activity has experienced a 100% and plus growthbetween 2005 and 200948, according to FNEHAD, the French HAD federation.This booming market is a clear opportunity for medical equipment providers. Indeed thebiggest issue is to bring a hospital into a patient’s home in order to insure the same quality ofcare. What are the differences between a home and a hospital environment? Actually almosteverything is different. This is why all equipment should be re-designed to fit this newenvironment.First of all medical equipment will have to be more mobile and rethink products to stand in“hostile” environments. Because it would be too difficult to transform a home into a hospital,equipment maker will have to transform existing hospital-standardized material into adaptive45 Diabeo (http://goo.gl/G0ZrT)46 L’hospitalisation à domicile, une alternative économique pour les soins de suite et de réadaptation, IRDES, 2007http://goo.gl/8myhu)47 L’hospitalisation à domicile, une prise en charge qui s’adresse à tous les patients, IRDES, 2009 (http://goo.gl/vFEoa)48 L’HAD en chiffres, FNEHAD, 2010 (http://goo.gl/kpImK) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 41
  • 44. products that can fit the diversity of homes. The material also required to be transportableeasily by home care givers and be robust.Then dedicated material should be connected. Connected to hospitals, connected to homecare givers, connected to local health professional. Remote conditions imply to be highlyreactive in case of adverse events. Monitoring devices capable of alarming relevant people incase of emergency is fundamental. Devices will have to be as smart and autonomous aspossible. In parallel the patient must be able to contact somebody in case of inquiry aboutanything. Dedicated call centers could be implemented to deal those calls and redirectpatients to a relevant interlocutor. Human contacts would not be suppress but optimized.The last challenge to answer the homecare market will be to simplify appliances. The goal isto empower the patient or its entourage with easy to use and easy to understand equipment.It will decrease anxiety and threat of misuse. Before any use, the patient, its family and thenurse who will visit the outpatient regularly will be educated on installed machine. Equipmentmanufacturers will have to provide trainings. d) Patient empowermentWe have already said, several times in this report, that the patient role within the healthsystem is gaining importance. This trend will be crucial for the emergence of mobilesolutions. As a matter of fact M-health application could not only target physicians orhospitals.Even if the patient used to be a layman about health and that it is neither the prescriber ofcare and medication nor the payer, it is willing to know more about its health. The Internettechnology has revolutionized the scheme of health-information sharing. Today boards andblogs about health are flourishing and people show an appetite to seek that kind ofinformation. The term of “expert patient” describe non health professional that have a powerof influence thanks to a personal experience of a specific disease. They spend time to sharetheir practice in specific situation and answer to patients experiencing similar situations. Theygot credit because people trust them and realized that their opinion may be more objectiveand useful since they know exactly what they are talking about. Pew Internet49 called thistrend Peer-to-Peer healthcare and is mainly based on social’s networks. It is not useless torepeat that 80% of Internet users look online for health information. Graph 3 gives moredetail about what people really look for.49 Survey, CHCF, 2011 (http://goo.gl/Skj4u ) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 42
  • 45. Graph 3 - Internet users seeking for health information (source: Pew Internet survey)To make a link with the previous part about chronic diseases, the report states also that onein four Internet users living with a chronic condition said they have gone online to find otherswith similar health concerns.Patient will want to choose the drug or the treatment they have heard of. They will want toboycott bad reputation procedures. or health industrials. In general there is a need forcredible, trustworthy, understandable, concise health information that is relevant, culturallysensitive, and actionable. With the emergence of over-the-counter health products (OTC)patient are already able to treat themselves. The multiplication of downloaded healthapplications shows that people are willing to pay out-of-pocket if it can empower them.Finally there is a trend in the health sector called personalized medicine. This medical modelwas born thanks to advances in biotechnologies and genetics especially. The concept is tocharacterize the molecular, genetic and metabolic profile of a patient in order to tailor anoptimized treatment or again to predict probable future health events. The patients becomeunique. Mobile devices could perfectly be able to quickly scan some specific characteristics.In emergency situations, without access to patient health data, blood scanning could give amyriad of precious information. Obviously this info will have to remain confidential and thepatient will finally have final control on it. Then mobile health solutions open large doors forcustomization of healthcare.In this environment, any mobile health solution should fully integrate the patient as a centralelement, in addition to traditional healthcare providers. It is not natural for health industryplayers but it will become mandatory. The next step couldn’t be reach without patientengagement. e) Cost, access, clinical outcomesAll the challenges outlined in the last four sections made us seen the potential opportunitiesfor M-health technologies. Identified possibilities imply lots of different solutions, includingsoftware, application, hardware, process and so on. However they all converge to the samepurposes. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 43
  • 46. i) Reducing costs. Direct benefiting parties will be the payers. Indirectly, through national health insurance funds, it will profit for the whole society while reducing the deficit of states. For healthcare providers it will help them to answer the pressure from governments and focus more on the care delivery. Patients will be able to reduce their complementary insurance fees and spend their money into extra personal health products. ii) Improve access to care. People are familiar with mobile device in their daily life. The fact that some health solutions will merge with already known tools will allow them to penetrate the market and make health be accessible for crowds. Dependent or remote people will be more easily integrated in the healthcare landscape. iii) Increase clinical quality. Wireless solutions will make healthcare be more precise, more reactive and more pervasive. The amount of data, collected thanks to the multiplication of automated records, the multiplication of patient inputs, will provide material to conduct analysis and improve the quality of healthcare.What is remarkable about those 3 purposes is that they are by nature accompanied ofresponsible innovations. Improving access means reshaping the way cares and physiciansmeet patients. M-health solutions may succeed in reducing time and space barriers that existin the physician-patient relationship. They also enable to cut inequalities between urban areacitizens able to easily reach health infrastructures and isolated people in rural areas. To betrue, the most promising application of M-health will be its diffusion in emerging countries. Inplaces where healthcare workforce is limited and people are isolated the possibility tocommunicate and share health information virtually bears lot of expectations.In parallel, efforts to improve clinical quality of healthcare services would have an impact onefficient allocation of resources. Actually M-health solution could massively avoid mistakesthat are problematic for patients and cause waste of time and overuse of medication.Too often new technologies are pushed and the rapid evolution and diffusion of them can bedangerous because we do not have enough hindsight. In the case of M-health it is likely tobe the contrary. The technology is ready but the system’s complexity slow down theintegration process. 2- Design a relevant business modelNow that we have identified a pool of challenges and subsequent opportunities for mobilehealth solutions we will give some insights about key points to build appropriate businessmodels. As mentioned in previous parts, medical device companies will have to consider newdifferent counterparts. a) Why medical device companies are more likely to be leading players in M-health?Up to now we did not discuss about medical device firms’ legitimacy to be central actors andleaders for M-health movement. If we have a look back to Figure 7 (M-health diagram), wesee that there is a competition between medical device companies and other device makersin one hand, but also with ICT players such as telecom companies and software innovatorsin the other hand. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 44
  • 47. As of today, firsts to be on the move were the software firms that have created many mobileapplications. Actually it was mainly an attempt that was supported by the large diffusion andadoption of mobile multimedia devices. However the added value of such applications is notclear yet. What is sure is that it fits a need expressed by individuals, patients and healthprofessional, to be better informed about health topics and be able to take care themselves.The major inconvenient of today’s solutions is that there are not linked enough to the healthsystem. Because they are basically consumer orientated, they naturally focused onindividuals. Unfortunately we have seen how the health universe is complex and that finallyindividuals are neither decision makers nor payers. As a consequence the use of mobileapplications remains superficial. That is precisely what the medical device industry can bringto the M-health sector. Indeed it used to have strong links with all actors within healthcommunities and a deep knowledge of interactions between them. Overall medical devicefirms have experience working in a purchasing environment dependent on payers and in aproduct development cycle that involves regulators.From this natural advantage they will have to compensate on other aspects such asunderstanding consumer needs, behaviors and attitudes and turning these insights intospecific product features and functions. Not only focused on clinical aspects. b) Build patient centric solutionsWhen talking about M-health and patient it is interesting to differentiate different categories ofpatients. i) Healthy early adopters. They are not ill or in bad shape but want to stay healthy, stay tuned about everything that is happening in the health universe. They are the ones who buy the brand new mobile health application. They are convinced that they have a role to play. Among “patient” they are relatively few. They are willing to pay for extra services. ii) Information seekers. They represent the largest part within the category. The information seeker is the person who wants to stop smoking and looks for tips and advice. It is also the mother whom child has to be operated and who is worried. Those people are neither convinced neither reluctant. They just want transparent information and find someone to ask questions to. They are not really willing to pay, but if they see real value added and that it does not imply much money, they will agree to pay iii) Dependent and monitored patients. This category includes chronic disease sufferers but also disabled or elderly. They are under treatment and have no choice but use the medication and equipment prescribed by physicians. They would like to gain autonomy without losing the support from healthcare givers. Their entourage is often involved. They are not willing to pay but want their lifestyles to be improved. The payers would like their costs to be reduced.They all want the same thing: be considered and felt that a solution can help themunderstand better, become healthier or live better. From those common principles the key isto design patient-centric solutions. No matter how beautiful, technical, or medicallysophisticated the product is, if patients don’t use it… To increase relevancy of any M-healthsolution, elements listed in Chart 10 should be taken into consideration. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 45
  • 48. Characteristics Relevancy The patient should feel that the solution answers its need. That the solution will help solving Value to the its problem. In order to increase the perceived value a big marketing effort, patient- patient orientated, have to be made by medical device companies. The highest value for a patient may not be clinical outcomes but consciousness outcomes. From sign up to cancellation, from installation to uninstallation, M-health solutions should be easy to use. The use of any mobile product or solution must meet the level of knowledge Ease of use of anybody. Medical devices makers have to keep in mind that patients’ capacities are far from homogeneous and in average lower than health professional ones. One size does not fit all. How each patient uses application will vary. M-health products Flexibility and must accommodate the different preferences of users. They must make people feel those adaptability. tools are theirs. They must offer the possibility to be customized. Users should always have control over the services they opt in to, how to receive Control communications, and who can access their account information. One of the main principles of the Hippocratic Oath is to respect the confidentiality of health information. People are more comfortable when they have marks. M-health solutions could eventually use multiple technologies. Adopting a new technology can be a barrier if it is too often. TheStandardization challenge will be to standardized technologies in order to improve the diffusion. From a and common standard all solutions will become synchronized, people will be able to connectinteroperability with others and will better welcome new products. Machine to Machine (M2M) communication will be facilitated. M-health devices will allow to record huge amount of data about almost everything related to health state of a patient. In order to promote the adoption of those solutions patients will Feedback loop want to know what those data means. A clear and easy to interpret digest of data accessible for patient is necessary. It is simply called pedagogy. Future medical devices should be proactive. It means that the patient will agree to use mobile device in some extent but they will want to be guided to act. What is the next step? Proactive What are the options now? What to choose? How to do? Answers to those questionscommunication should be pushed without the patient have to ask for them. It is mandatory to increase autonomy and avoid the patient to not act, or worst, to make mistake. Finally one of the biggest drawbacks of mobile health solution, from a patient point of view, Remote is the lack of human contact. Yet health is often source of anxiety and worries. Any M- presence health solution should then integrate the possibility to ask questions every time everywhere. Call centers, hotline or real-time chat will be excellent options to support patients. Chart 10 - Key characteristics for building patient-centric solutions (inspiration: How to profit from M- health revolution, Pamela Swingley, 2011)As mentioned by Thomas Goetz in a recent TED’s speech50, the future of health will not beonly based on technology advances but also on patients’ engagement. On the contrary toadherence or compliance to a treatment, the challenge is to make people be convinced thatthey are able to do understand what is important. And that they will act not because theyhave been told, but because they are engaged. Obviously this state of mind must besupported. Mobile solutions will have to engage thanks to two features: feedback loop andpushed communications, as seen in the Figure 8.50 TEDMed 2010, Thomas Goetz: Its time to redesign medical data (http://goo.gl/4BHEk) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 46
  • 49. Figure 7- Engagement Loop applied to M-Health solutionThe resulting engagement cycle shows that the device-patient interface should beparticularly improved. As of today, health information is often raw-displayed and unclear ifyou are not a physician. c) Adaptation to the complex practice of healthcareAlthough the future of M-health will be to provide patient-centric solutions, medical devicemakers will not have to forget healthcare professional. At the end those actors will be theprescribers, the initiators and the patients’ adviser. We could assume that the task will beeven harder with physician.We have seen in the first chapter that physicians are part of a “caste” among societies. Theypossess a certain image and pursue an honorable mission. This mission is to treat peopleand as it is often said “to save life”. The seriousness and purpose of healthcare is not to bedemonstrated, but we can be sure that change mentalities will not be a simple thing. To whatextend would the doctors agree to give more power to patients? To what extent wouldpractitioners agree to let a device replace them?In addition to those existential questions there are real barriers. Hospitals are most of thetime under-staffed and workflows are complex (patient, material, administration). In suchenvironments healthcare professionals do not have time to adopt the new technologies. Theyare in the present time, often in a rush. For health professional outside hospitals barriers aredifferent. The main challenge is to deal with a fragmented population of patients located atdiverse places. Patient accessibility is more difficult than in a hospital for instance. Plushealthcare workers are themselves dispersed, making interrelations more difficult. Each ofthem are based in facilities that have different sort of equipment. Each of them has properhabits to provide healthcare. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 47
  • 50. All those difficulties will force M-health providers to include key characteristics in mobilesolutions. Some of the features exposed for designing patient-centric solutions will be adaptto improve the diffusion among health providers. For example ease-of-use will be primordialwhile giving the possibility for mobile device to integrate more complex settings. For thatpurpose mobile solutions could allow physicians accessing complementary options,unreachable for patient. Moreover standardization and interoperability will be a critical point.Let us imagine that a practitioner is remotely following dozen of patients with differentdiseases then with different mobile solutions. How could he or she be efficient in providingcare if all those technologies are different? How could he or she be confident in juggling withdozens of different platforms? In such cases the expected advantage of mobile solutions willnot turn to be a reality.Finally, to cope with physician’s reluctance and make them adhere to M-health solution,mobile device makers will have to emphasize on trainings and awareness campaigns.Pertinent clinical trials and witnessing from key opinion leaders will have to be conductbecause it is often the only way to convinced healthcare professionals. It also important toremember that tomorrow’s physicians are now young students. And like a majority of youngpeople they are particularly accustomed to new mobile technologies. Trained those futurepractitioners to use mobile devices may be a good strategy. d) Build partnerships to provide fully integrated M-health solutionsThe description of the health system, complemented by the analysis of the M-healthenvironment, has led to the conclusion that medical devices makers are only some playerswithin an extraordinary complex game. Yet we have also seen that mobile solutions have thecapacity to reshape the whole system and set new rules. Even if medical devicemanufacturers are the most credible players to lead the movement (as mentioned twochapters earlier) it is obvious that they will have to find partners. First, with the ICT players.Second, with health actors. Alliances with ICT and electronic actorsA partnership has to be seen as a win-win collaboration. The first level of partnership will beto collaborate with telecom operators and Software companies. In fact wireless healthdevices will have to be thought as solutions and ecosystems, not just as products. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 48
  • 51. Figure 8 - Mobile health ecosystem, different layers that have to be linked (source: IBM)The ecosystem represented in Figure 9 was inspired by IBM Global Business Services in a2011 report51. Red parts represent medical device manufacturers’ field of activity. It will beessential to find partners in the other fields.A device manufacturer will have to insure that data recorded by its products could be stored,safely. This could imply to find a company operating servers. Those servers should have thecapacity to store complex data. For instance, a routine chest MRI exam contains hundreds ofhigh quality images and weights up to 1 Gigabytes. Then the device maker will may need tocollaborate with a software company that develops user interfaces. Indeed we have outlinedthe importance of ease-of-use and of user friendly displays. This intuitive interface will beimportant for the mobile device but also for the web platform associated, unavoidable backoffice for every M-health solution. Web giants like Google or Microsoft which have alreadydeveloped such web platforms will be perfect associates. A publishing company that supplieshealth related information and content may be also useful to feed such a platform.Between the servers, the web resources and the mobile devices, networks are necessary.Providers of web connection like the one presented previously (Orange Healthcare) would beapproached to sign partnership. Telecom operators could also be excellent allies and wouldopen doors of smartphones market that is up to now the most used device for health purpose(thanks to mobile applications). We could imagine that in the future, a phone subscription willbe sold with a health-related package.Finally we will focus again on the rivalry between medical device makers and mass-consumption electronic device ones. Those last can teach a lot about consumer relationshipto medical devices companies. This is why it is highly relevant to create bridges between thetwo worlds. The widespread of electronic appliances could benefit for the penetration ofmobile health device, quickly and efficiently. We have already talked about that mobile phoneadd-on that is dedicated to measure the blood pressure. Some others are capable ofmeasure blood sugar level. More surprisingly, we could imagine earphones measuringbody’s temperature, heart beat and blood pressure while listening to music!51 IBM Global Business Services, The future of connected health device, 2011 (http://goo.gl/Zo2Vu) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 49
  • 52. The convergence has no limit and the more partnership will be signed, the more solutions willemerge. We don’t even talk about alliances with garment makers (wearable devices),furniture’s sellers (smart homes), food manufacturers (co-marketing)…In addition to invent new technologies, unions with those players will make possible to buildtechnologies’ standards. Indeed device makers should remember that interoperability is oneof the mandatory factors to allow M-health diffusion. Partnerships with health system’s playersIn this market, healthcare provider relationships will be particularly vital – not only becauseconsumers will rely on them for recommendations, but also because the value proposition ofmobile health solutions falls apart if they are unwilling to use this new data source.Depending on how a new device is sold, device makers may need to work with pharmacists’communities as well as physicians and hospitals. The strategy will be to involve key opinionleaders that have a large influence on their counterparts. As seen before, the healthprofessionals’ adoption will also rely on tangible proofs of efficiency. The idea will be to workwith famous scientific organisms, unions or NGOs and conduct large scale trials and studies.Making these new devices affordable may require some type of insurance reimbursement orincentive such as premium discounts. Medical devices companies may need to collaborateclosely with those insurers. To help control healthcare costs, insurers may assume anincreasingly prominent role in the M-Health ecosystem.Obviously collaboration with patient communities will be highly interesting. To learn from thedeep needs of the sufferers in one hand and to promote the so-designed solutions in theother hand. Public-private partnershipWe would like to highlight that the public-private partnership option is a remarkable one. Assaid just before, work with public hospitals will be necessary. Selecting on-the-edge institutesand implement best-in-class M-health systems would probably worth more than any othermarketing campaigns. Conducting pilot experiments with local administrations could be agood choice.Europe is also willing to partner with M-health devices makers. Through the 7th FrameworkProgram, the European commission will invest €258 million in 2011-2012 for ICT researchprojects focused on health topics52. To be eligible, large companies, small companies andpublic institutions from different European countries have to form consortia and apply topublished calls. e) How to sell and monetized wireless health solutionNow that we have seen what the best solutions to build are and how to conceive them bypartnering with other players it is time to understand how we could sell those M-health52 ICT Challenge 5: ICT for Health, Ageing Well, Inclusion and Governance, European Commission (http://goo.gl/ZpGNw) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 50
  • 53. solutions and monetize them. We could answer this question first by identified parties willingto buy and for which expectations. Then we will decline a distribution channel for each ofthem and a payment process. Business model for customer-patientsAs we put emphasized on the growing role of patient all along this report we will treat thiscase first.The PwC’s Health Research Institute has recently conducted a survey on consumer to getinsights on their behavior relating to health-related mobile solutions53. The survey’s reportconcludes that 49% of interviewees will be willing to buy a mobile health solution. To be moreprecise 40% of respondent will agree to pay for a remote monitoring solution ($10/month formobile phone service,$75 for a device). Whatis surprising is that menand healthy people arethe most inclined to payfor such services. Thesurvey shows also thatcustomer-sold solutionswould preferably bemobile phoneapplications or mobile-linked devices.Thanks to those fewinsight we can draftbeginnings of adistribution channel.Those solutions willhave to be mainlylinked to smartphones’ Figure 9 – M-health business model for consumer-patient’s solutionsenvironment. Then, asmentioned sooner, the best way for selling health solutions directly to customers will be topackage them as phone subscription option. Devices that would be used as smartphoneadd-on could be sold in high-tech or phone department in retail shops. These devices couldbe used indifferently with smartphones. Applications could also allow patients’ entourage tobe informed of the tracked data (Figure 10).In addition those products could be sold at hospital, at physician’s cabinet or at chemistry’s.As patient still trusted a lot those players it will be an excellent promotion for mobile healthproducts.In option people could request for detailed analysis of the captured data, and ask forrecommendations from healthcare professionals. This service will be charged as pay-per-request and added to the phone bill.53 Healthcare unwired: New business models delivering care anywhere, PwC Health Research Institute (http://goo.gl/8M4LV) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 51
  • 54. Business model for In-town care giversA second strategy will concern mobile solutions targeting healthcare providers working in-town, as opposed to the ones working in health establishments (hospitals or clinics).The PwC’s report gives us material to target those actors. Actually there are two things thatcare providers give value to: Increase the clinical outcomes for their patients, and save time.56% of surveyed physicians answered that mobile solutions could help them to improve andshorten the decision making phase. They also outlined they are willing to track their patient athomes and would like to communicate easily with patients using mobile technologies. Thelast important point for them is to better interact with their counterparts.M-health solutions could be then sold directly to physicians. Typically software includingpatient management capacities, with mobile communication features (virtual visits, SMSchatting) will be purchased by unique physician or community of physicians in order toreplace their old patient-management software. However there is a bug in this model.Actually doctors gains revenue proportionally to volume of visits. Yet those remote solutionsaim at reducing the number of visits. Possibilities are emerging.Either patient will have to pay premiums each time they use that kind of virtual relations (maybe reimbursed thanks to claims). In this case M-health providers will charge the physicianproportionally to the software use, also known as SaaS model (Software as a service). Oreven better, the M-health provider will take a percentage on the paid premiums. In parallelphysician who will save time by using those platforms could offer a bit of its “medical time” tofeed parallel platforms where people request medical advises (Figure 11). Figure 10 - M-health business model for healthcare provider’s solutions Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 52
  • 55. Business model for health establishmentsHospitals, clinics but also elderly institute and home-care providers have in common to dealwith a multitude of healthcare professionals, patients and equipment. In such organizationsthere is a need to improve workflows. Workflows refer obviously to care activities but alsoadministrative and financial activities. The added value for those organisms will be to gainefficiency.The clear interlocutors within those entities will be Chief Information Officers (CIO). A CIO isa senior executive in an entity responsible for the information technology and computersystems. They are supported by health workers using the technologies. CIO and IT decision-makers in health entities are good intermediaries. They are opened to new solutions andable to influence others parties (payers, health professional). Figure 11 – M-health business model for health establishment’s solutionsSo M-health solutions must be marketed as central solutions that have the capability tomanage every workflow within a health organism. Machine to Machine communication willallow tracking all resources, recording real-time progression and abstracts of consultationsand exams. They will also be relevant to improve equipment’s coordinated use, personalizedrelationship between patients and health providers and avoid patient being forgotten.To sell such solutions M-health provider should consider the SaaS business model as amajor source of revenue. Since those projects should be really compex to implement, theSaaS model will avoid organisms to invest huge amounts at the beginning.Like for physician there is also here a problem of incentive since hospitals earn money basedon volume of activity. The objective of improving quality and management should result in a Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 53
  • 56. decrease of activity. The game will be that payers assess the savings realized in equippedentities and give them more budgets based on efficiency objectives. 3- Foresee adverse or collateral effects of M-health solutions: be conscious and responsible innovators.Although M-health solutions are expecting to revolutionize the healthcare system for thebenefit of everybody, it makes a point to warn about some key points. The concept ofresponsible innovation is currently studied by people such as Xavier Pavie and must bedifferentiate from innovation for responsible purpose. According to him, “the responsibleinnovation’s stake is to integrate measures respecting the environment and the people allalong the innovation process, including development and marketing phases. Even if finalinnovation’s purpose is not to protect environment or people, innovators should be aware ofthese concepts while conceiving their product or services”54. a) Ethics and health Information securityOne of the major issues raised by connected health in general is the security of healthinformation exchange. The already mentioned PwC’s report states that 41% of interviewedphysicians would be “worried about privacy and security”. From ancient times the privacy andconfidentiality of health information have been an important characteristic of medicinepractice. It is not surprising that this aspect is a key point of the Hippocratic Oath. Healthinformation is part of patient’s intimacy and one will not be likely to share those witheverybody. It is especially important at a time when people are able to diffuse informationwith a simple mouse click. If they are willing to do that for other kind of information, likephotographs on social networks for instance, the willingness seems totally not trueconcerning health information. Imagine that an employer, an insurer or any other parties thatcould be interested in knowing the health state of a citizen, could access the digitalizedhealth information is a threat for many.Answering this issue will imply implementing high-level security processes. M-health actorsshould become security experts. To do so it could be interesting to take the financial servicesindustry as a model. Actually they are on the edge in the security of data’s exchange,networks and private identification. The challenge will be hard but it will be important toestablish trust and assurance with the users. Anyway regulators and governments willprobably set rules, laws and certifications to guarantee health data privacy. Againpartnerships and standardization will be fundamental to achieve this high-security level. b) Reduce impact on environment and peopleMassive adoption of M-health devices is assumed to improve everybody’s life, customers,physicians, governments. However, this positive vision could be spoiled by negative effectson environment or, more paradoxically, on people’s health.Manufacturing medical devices has a direct impact on environment. Components ofelectronics products often include rare materials or polluting ones. Creation of those healthelectronic products should then integrate end-of-life management. In simple words it means54 Innovation-responsable, Xavier Pavie, 2012 (Eyrolles) Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 54
  • 57. that devices manufacturers should consider recycling path for used-up products. It can alsomean reduce polluting material or designing efficient-battery device using renewable energy.Another problem will be the continuous use of M-health devices, especially in the case ofmonitoring devices. The fact that those products will be connected and used in close contactwith the body raises questions. It will be of high importance for device makers to prove theinoffensive character of wireless products. For the moment the mobile phone industry isdealing with this problem but clear evidences were not found yet… Imagine a device used totrack babies’ vital signs. What could be the negative effects of radiofrequencies or otherinfrared emissions on its brain? If M-health solutions bring more problems than solving ones,its interest could be limited. c) Use of M-health in the developing worldThe scope of our subject was clearly mature countries. But the reality is that M-healthsolutions are still more promising in poor countries. It could improve healthcare access forremote populations where physicians are few and often not trained well. Telemedicine couldbe a perfect solution. Moreover we have seen that penetration of mobile phones is definitelyhigh in developing nations, compared to other technologies. The prevention and education ofpopulation could benefit from this mass diffusion thanks to awareness SMS campaigns orother communications.One way for M-health solutions makers to be responsible innovators will be to design someproducts that could be turned down and used in developing areas. Those products should besimple, with only basic features and again more robust. Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 55
  • 58. GraphsGraph 1 - Health expenditure per capita by age (source IRDES) ............................................ 10  Graph 2 - Age Structure Diagram, France 2010 (source: INSEE) ........................................... 36  Graph 3 - Internet users seeking for health information (source: Pew Internet survey)........... 43  ChartsChart 1 - France health expenditures, € billions (source: INSEE) ............................................. 9  Chart 2 - Breaking down of Care and Medical Goods Consumption, €billions (source: INSEE)9  Chart 3- Healthcare workforce (source: WHO health report statistics, 2011) .......................... 12  Chart 4 - Health complementary insurances in France (source: DREES) ............................... 18  Chart 5 - Common Health Information Technologies (source: Medpac) ................................. 25  Chart 6 - Potential outcomes for M-health solutions (source: Triple Tree) .............................. 27  Chart 7 - Main mobile phone operators (source: Wikipedia) ................................................... 30  Chart 8 - French population forecast (source: INSEE) ............................................................ 37  Chart 9 - Weight and cost of ALD 30s for the French Health Insurance (source: CNAMTS2008 and 2009) ...................................................................................................................... 39  Chart 10 - Key characteristics for building patient-centric solutions (inspiration: How to profitfrom M-health revolution, Pamela Swingley, 2011)................................................................ 46  FiguresFigure 1 - Maslows hierarchy of needs ..................................................................................... 5  Figure 2 - Development of a pharmaceutical product .............................................................. 14  Figure 3 - Scheme of the French Health Insurance Fund in 2009 ........................................... 17  Figure 4 - The Healthcare value chain (source: Lawton Burns)............................................... 19  Figure 5 - Kondratieff waves and Schumpeter analysis........................................................... 23  Figure 6 - M-Health Environment............................................................................................. 31  Figure 7- Engagement Loop applied to M-Health solution....................................................... 47  Figure 8 - Mobile health ecosystem, different layers that have to be linked (source: IBM)...... 49  Figure 9 – M-health business model for consumer-patient’s solutions .................................... 51  Figure 10 - M-health business model for healthcare provider’s solutions ................................ 52  Figure 11 – M-health business model for health establishment’s solutions ............................. 53   Bruno Rakotozafy | M-Health revolution: which opportunities for a medical device company? 56
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