Will Siemens, Philips, GE Healthcare, Johnson and Johnson, Medtronic and INTEL evolve into Senior Citizen Service Providers (SCSPs) in the near future?
This blogpost was first published on the 27th of February, 2007.
Most of the population across the Western world, especially North-America and Europe is aging, without significant replenishment, as reflected in the declining birth rates in those continents. This is both a significant challenge and an enormous opportunity. The challenge comes by way of trying to provide Medicare and Social Security for these aging baby boomers with the financial responsibility of doing so, spread over a more modestly sized young and working population.
At the same time, given that most of these aging baby boomers have lived thru possibly the most affluent economic period over the last 100 years, providing what I term Quality Healthcare for Senior Citizens (QHSC), represents one of the most significant business opportunities of our times, and one that has the significant higher purpose of ensuring that our senior citizens have the very best in healthcare in their twilight years.
Given some of the challenges confronting the Life Sciences industries highlighted earlier (“Who moved my Blockbuster cheese” and “The 3 Questions that keep Big-Pharma CEOs awake at night?”), consolidation across industry segments (especially Pharma and Bio-Tech) is inevitable, and in fact, is happening as we speak. Compounding this will be the pressure from the government, patients and senior citizens to temper the rising costs of healthcare to a level close to inflation, especially given the ever increasing number of people who cannot afford health insurance (currently 47 million in the US alone).
A strategy for Life Science companies to deal with this challenge and exploit the incredible opportunity presenting itself, would be to either acquire or partner with companies across segments, to form an alliance of service providers to deliver healthcare services for senior citizens (as an example that can then be extended to the general population) focused by therapeutic area(s). For instance, it is not difficult for me to imagine an alliance of what I call the drugs-devices-diagnostic (D-D-D) producers like Johnson and Johnson, Medtronic and Siemens Medical Systems or GE Healthcare converge (in association with leading healthcare providers, or not) to create a network of healthcare centers focused on the needs of senior citizens, to deliver quality healthcare with the best outcomes at the most economic price points, given their economies of scale and scope.
Economically, this is an idea approximately similar to moving from “selling wine by the bottle to wine by the glass” whose time has come. Given the large number of high net worth senior citizens in North-America alone, who will demand and expect the very best possible healthcare, it makes business sense for companies like Siemens, GE, Medtronic and INTEL to collaborate and deliver what could potentially be very profitable services (relative to those on selling their products alone) leveraging the cutting edge technologies that they have already developed. These could all be deployed to create state of the art healthcare communities for senior citizens that would not only assure a great quality of life and social networking, but also proactive healthcare intervention predicated on a prevention/mitigation paradigm rather than cure, which can be anticipated to significantly drive down the total-cost-of-healthcare (TCH) per senior citizen, except in extreme cases.
For instance, it is not a stretch to imagine an INTEL inside hand held device, or one that can be worn like a wrist watch, that will not only help a senior citizen comply with the prescribed dosage of medicine but also monitor vital signs like blood pressure periodically, that can be transmitted leveraging wireless telemetry, over a cellular,WAN or WIMAX network to a central monitoring location, not dissimilar to that used for home security monitoring today. Technologies like Care link from Medtronic would also enable the same model to work with implanted or embedded medical devices like pacemakers, implantable defibrillators and even, perhaps, drug eluting stents, going forward. Remote monitoring of key health performance indicators and any variation thereof, would invite proactive intervention from a qualified nurse or a doctor, (based on the severity) who would of course, secure the patient’s electronic health record (EHR) on demand.
As well, having access to cost-effective access to the latest diagnostic technologies like 256 slice CAT scanners either on-site or in close proximity, and reasonable periodic screening, would significantly cut down the costs of treatment given that most chronic conditions (coronary heart and artery disease, risks of stroke or early signs of cancer) can potentially be detected early and treated appropriately, rather than detected when its too late and extremely expensive to diagnose and treat. Physical monitoring of the data centers could potentially be outsourced to low cost centers around the world, given the proliferation of data, call and even high end diagnostic centers in countries like India (it is fairly commonplace today for neurologists in India and Israel to perform the initial diagnosis on brain scans of American patients that are electronically routed to them) that have developed a robust healthcare system and support infrastructure.
I hope I have articulated well what in essence, is my vision for the high quality healthcare I will expect as a senior citizen, aligned with the vision of “Personalized Medicine for Enlighted Prosumers” elucidated earlier and would not be the least bit surprised to have these delivered by brands like Siemens, Johnson and Johnson, GE, Medtronic, and INTEL in the foreseeable future! If you believe this is far fetched, please take a close look a the mandate and mission of the recently formed Continua Health Alliance, with INTEL as one of the primary orchestrators of this shared vision. It would appear that my prognosis for affordable, Quality Healthcare for Senior Citizens (QHSC) enabled by these industry leaders in bio-pharma, medical equipment and devices, is a distinct possibility in the not-so-distant future!