Post-pandemic boost to the digital healthcare sector
Long before the emergence of the COVID-19 virus, ‘Big Data’ was known as the new oil of the digital economy but with the transformation of the economy since it came along, and a surge in the use of technology in the healthcare system, a new digital healthcare market is emerging for investors.
The data-driven health revolution in Australia is definitely underway, with linked data set to advance the efficiency, quality and delivery of healthcare.
According to the government, Australians are embracing the benefits and the potential of this revolution.
My Health Record, a national electronic patient record system, is managed and maintained by the Australian Digital Health Agency. Over 90% of Australian residents have a My Health Record. Healthcare providers across Australia are storing and accessing the information to get a more complete view of a person's overall health.
Support for the use of My Health Record data for research purposes is high, with 44% of Australians strongly in support and a further 46% somewhat in support1.
Australia also has several other accessible big data sets including the National Echocardiography Database of Australia (NEDA), the largest study of heart function in the world, and the Murdoch Children’s Research Institute’s POSSUMweb – a dysmorphology database.
What this creates is a big data sandpit for developers to create digital health solutions.
In its latest Budget the government has announced plans to provide further assistance to the drive to digitise healthcare services by allocating a total of $35.2 million over 4 years from 2022-23 to support these programs.
This included $32.3 million in the next financial year to continue the support for initiatives such as My Health Record and the Health Care Identifiers Service. A further $2.9 million over 4 years to improve the security of the Australian Insititute of Health and Welfare’s data holdings by migrating them to cloud-based services and off-site data centres. While $20.4 million was allocated over 2 years from 2021-22 for the extension of temporary telehealth Medicare Benefits Schedule (MBS) services to support the management of COVID-positive patients in the community.
While the amounts are not huge, the government is clearly expecting telehealth and healthcare data provision to become key elements of the future of the national health system.
Telehealth boom may become the new normal
Deloitte Australia has predicted Australia is also on track to exceed the global average for telehealth adoption with more than 10% of Australians regularly using telehealth services in 2021, thanks mainly to the impact of the pandemic.
“The next five years will see a shift to virtual health as a consumer norm as use of digitally enabled health services, such as apps for preventative health, care and recovery grow exponentially,” says Telco, Media & Entertainment leader at Deloitte, Will Castles.
“Virtual health will enable consumers to move up the health continuum, changing not just the way healthcare is provided and accessed but also supporting the strong demand for wellbeing enabled by wearables and connected homes,” Mr Castles says.
Local Artificial Intelligence links
This trend toward combining big digital data flows with healthcare science also taps into another expertise Australia has been developing which is Artificial Intelligence (‘AI’). When you combine all three you get some of the world’s leading healthcare solutions from small, little-known companies.
Melbourne based Alcidion Group Limited (‘Alcidion’ ASX:ALC), for example, describes itself as a leading global healthcare technology and informatics company. It posted a 12% rise in gross profits for the first half of fiscal 2022 to just $10.9 million. However, the company, which aims to help healthcare organisations to embrace smart technology, unlock new insights and drive innovation, claims its products are in use in 336 hospitals across Australia, the UK and New Zealand.
Alcidion recently told the ASX it had signed a five-year agreement with the National Health Service (‘NHS’) in the UK to implement its Miya Precision platform for the Herefordshire and Worcestershire Health and Care NHS Trust. The Miya platform allows hospitals to obtain real-time knowledge of bed capacity, gaining early visibility of incoming patients with their clinical context.
Another firm to do well in the UK is Beamtree Holdings (ASX:BMT) which announced its first NHS contracts with hospitals in England in March.
Milton Keynes University Hospitals and Lancashire Teaching Hospitals will implement 12-month proof-of-concept programs centered on the application of Beamtree RippleDown technology and data analytics. The RippleDown platform automates the coding of clinical records, a process key to delivering better patient safety.
Recently listed Careteq Limited (ASX:CTQ) creates and provides software-as-a-service-based solutions to assist the elderly and those with disabilities to continue living their best lives. To do so, the company has created its Sofihub platform, which is a digital assisted living solution using Artificial Intelligence and sensor technology to support seniors in their own homes. Sofihub observes and learns normal behaviour in the home, then identifies abnormal behaviour and raises alerts.
Other examples of Australian digital health solution providers include Sydney based healthcare data analytics company Prospection which uses real world healthcare data and combines it with predictive analytics and machine learning to provide of tools for the pharmaceutical and healthcare industries.
International Interest in Australian health tech
Internationally, Canadian intelligent dermatology startup MetaOptima Technology Inc (‘MetaOptima’) is using Australia’s world-class melanoma research capability to develop a highly advanced skin dermatology platform, DermEngine. It uses AI to support the early detection of skin cancer.
Australia has one of the highest rates of melanoma in the world, with skin cancer accounting for around 80% of all newly diagnosed cancers.
“Our scientists in Australia are pioneers; they are changing the whole ecosystem and leading the wave of skin cancer innovation. Being part of that innovative family, having those leaders on board is awesome,” said MetaOptima Co-founder and CEO Maryam Sadeghi.
ETF options emerging
For those looking for cheaper way to gain exposure into the growing market for digital health and telemedicine companies, Betashares has recently announced it will soon offer an ETF focused for this sector on the ASX.
The BetaShares Digital Health and Telemedicine ETF (EDOC) will offer investors exposure to a diversified portfolio of up to 50 leading companies in the growing digital health and telemedicine industry, such as Boston Scientific, Abbott and Resmed. To qualify for inclusion, companies must be engaged in sectors such as digital healthcare, connected to? medical devices, remote patient monitoring, telehealth or wearable products.
Fund house Fidelity Australia also offers a Digital Health ETF, Fidelity Digital Health (FDHT) which tracks a market-cap-weighted index of globally listed companies involved in digital health technologies, listed with exchange operator Cboe Australia
The pandemic has both increased the adoption of digital health services, with many turning to telemedicine for the first time. The relatively-fast rate of adoption looks set to continue, with number of local companies positioned to benefit from further advances in the digital health sector making it a potential post-Covid winner.
1 Big Data and AI, Australian Trade and Investment Commission. https://www.austrade.gov.au/digital-health-big-data-ai