New players in health sector | Digital health startups

digital health startups

In Germany, the health care industry will take over the automobile industry by 2020. Health care sector will generate revenue of around 420 Billion Euros by 2020. Any company willing to become a key player in the future cannot afford to neglect health care. The revolution has already started in some countries with numerous digital health startups entering the market. Samsung and Google are predicted to become the largest health care players by 2020.

The health market is growing rapidly and brings in a lot of new challenges to be overcome such as lack of skilled workers, aging population, the rise in chronic diseases and self-determined patients. All these factors make health care attractive for businesses. However, any country can amend legislation quickly, propose new health policies and regulations which might make an established company sink to the bottom.

Due to the stricter regulatory environment, rating agencies might not assign A-ratings to health care companies. One way to deal with this kind of situation is to invest in multiple areas of health care rather than a single space to diversify away from the risks of legislations. MedTech companies, known as Medical Consulting Firms will hire their doctors and provide health care services.

This is a golden opportunity for the new entrants to create their niche in the health sector. New arrivals ‘raiding’ the health care industry will be well positioned to offer innovative breakthroughs. For example, a logistics company might be able to provide patient transportation services.

‘Patchie’ empowers patients of chronic diseases with knowledge

A medical product called‘Patchie’ provides digital solutions for transitional medicine, and its primary focus is on chronic illness, mainly cystic fibrosis. They make people aware about their chronic disease, empower them with knowledge and encourage them to undertake therapy which can give them a higher life expectancy. Their target group is the patients suffering from cystic fibrosis and have collaborated with patient organizations, hospitals, pharmaceutical companies, health insurance companies to gather data and develop the application efficiently.

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Major players pose challenge for upcoming digital health startups

Major companies like Samsung and Google which are entering the health care sector, pose a significant problem for the newer entrants and startups. But, the fierce competition between different organizations to be the front-runner in health care industry will lead to innovative breakthroughs to provide quality health care to the patients.

The future of diabetes care

Diabetes care is different from the typical diagnostic process. Companies have to take into account all the market dynamics and need to focus on all aspects such as sales and marketing to target that group of patients. Due to large scale consumerization, health care companies need to understand the needs of the patients and find innovative solutions to diagnose and treat diabetes.

Health care providers cannot put all of their resources on diabetes. There are a lot of other comorbidities associated with diabetes like depression which need to be treated and incur a huge amount of money. This brings in a new concept into a play called Integrated Health. They need to collaborate with other providers to share technology, capital and human resources to be able to survive in the international market in the future.

Market strategy for new entrants in digital health

Traditionally, pharmaceutical companies have had a higher rate of growth and revenue than hospital groups and startups. Thus, pharmaceutical companies have started lagging behind regarding strategy and growth because of not being quick enough to respond to the ever-changing market scenario. Therefore, we might see that startups and other health care players might acquire the pharma companies. As Michael Burkhart, Healthcare & Pharma leader, PwC Germany says, ‘It is not about having the best strategy in place. Players adjusting to the market dynamics and being quick enough will be the front-runner in global health scenario in the future’.

Market strategies for the new players also depend on the country they are targeting through their product. Some countries have the procedures in place to invest, conduct research and launch eHealth products in the market. A lot of political will and determination from the government is required to provide quality health care to its citizens. There are different standards and guidelines across borders governing digital health sector.

Startups in the digital health sector will provide innovative breakthroughs and transformative technology to provide quality health care at low costs. There is a need to have global standardized procedures and guidelines to develop an eHealth product. Cross-border exchange of data and interoperability are the key areas, which different governments need to work in, through collaborative efforts.


Challenges for new entrants Some Solutions
Lack of skilled workers, rise in chronic diseases and associated comorbidities, responding to quickly changing market dynamics, No standard guidelines and procedures Collaborating with pharmaceutical and health insurance companies, putting pressure on the government to develop standard guidelines and regulations.


Philipp Grätzel von Grätz, Journalist

Michael Burkhart, Leader Healthcare & Pharma PwC Germany
Horst Merkle, Vice President Continua Health Alliance / Director Information Management Systems Diabetes Care, Roche Diagnostics Corporation
Maria, Birds and Trees, Hamburg

Video URL:

Upload Date: 27th November 2016

Video code: 16R206

Patchie, Birds & Trees:

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