Team Number: 8
Health, Do you Care?
According to Forbes, the Healthcare industry is the world’s largest sector today, three times bigger than banking, however it has not seen the rapid digitisation other industries have undergone in the past decades. Consequently, the industry is making up for it by transforming itself, at an unprecedented rate, never seen before. The inelasticity of demand for healthcare has traditionally enabled the supply to have sufficient funds for extended research. For these reasons, we have decided to focus on the disruptiveness of e-heath and virtual platforms.
Three common success factors identify the disruptors in healthcare: they cure diseases; they transform the typical practices of medicine and their technology can also be sustaining. We analysed if the technologies we chose are really industry disruptors.
A new phenomenon is telehealth which is the delivery of virtual health care. Accenture is estimating it to become a billion-dollar industry, with virtual doctor visits surpassing traditional ones in the foreseeable future. An example of a telehealth is Healthtap, a company that started with a free question-and-answer website, that connects patients with licensed physicians across the US. Currently, according to their figures, they estimate to serve has 10 million users. They have evolved their e-platform and offer a premium on demand service, that allows patients to video call with a doctor for a monthly subscription fee. HealthTap has raised $35.5 million in funding and is expected to grow rapidly, as the popularity of the app continues to rise.
However, with its strict regulations and constant scrutiny, the healthcare industry does not tolerate deceit. Theranos is a biotech company that Elizabeth Holmes, a Stanford dropout, founded in 2003 with plans to revolutionise the blood-testing market – a market which an annual turnover of $75 billion. Only recently, the company was the darling of the most successful venture capitalists of Silicon Valley. Currently, investors lost some or all of their $700 million investments, while the net worth of Holmes has been diminished from $4.5 billion to nothing.
It seems like eliminating the middleman, in this case the doctors, was the disruption of the lab testing industry. But apparently it was also the company’s biggest mistake. Theranos’ business model is built on the idea that it can offer more than 240 simple blood tests directly to patients at a much lower cost than traditional blood labs, with its own technology. However, they have not been able to live up to the promise and only a handful of tests were conducted via their Edison machinery.
A cooperation disruption was in the form of a partnership with Walgreens. By opening blood collection centres in Walgreens, the second-largest chain of pharmaceutical companies in the US, they effectively established a distribution chain, which was unheard of for a blood-test company.
Nevertheless, after The Wall Street Journal first made allegations that the company was, in effect, a sham – citing a former employee, now the regulators have revoked firm’s license to operate a lab in California due to unsafe practices and Holmes is banned from the blood-testing business for at least two years.
These two intricate examples in this blog make you wonder if technology is making the health industry more effective or pushing doctors away from patients.
As an addition to the analysis of these two companies, interviews were conducted with stakeholders whom are directly impacted by the advancements in this industry: doctors and medical students. They provided ideas on how the future of healthcare will look like.
Group Members
Dominic Klapwijk 404704
Mikayel Meymaryan 385652
Arada Vording 387292
Sedale Wijngaarde 383095
References used for the video and blog post
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Das, R. (2015). The Companies Disrupting Healthcare In 2015. [online] Forbes.com. Available at: http://www.forbes.com/sites/reenitadas/2015/06/11/top-companies-disrupting-healthcare-in-2015/#1a108f8318a4 [Accessed 14 Sep. 2016].
Dvorsky, G. (2015). The Makers of That “Miracle” Needle-Free Blood Test Are On The Defensive. [online] Gizmodo.com. Available at: http://gizmodo.com/the-makers-of-that-miracle-needle-free-blood-test-are-1738057269 [Accessed 16 Sep. 2016].
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