Today, healthcare provision remains one of the biggest and most pressing challenges of governments in the 21st century. Everywhere across the world, states are facing ever greater demands on their healthcare services. Ageing populations are a universal cause, while in the Middle East the governments are further challenged by a growing population, combined with an increase in chronic diseases, particularly diabetes, cancer, obesity and cardiovascular diseases. In response, healthcare providers are looking for ever more efficient, precise and effective technologies to provide care for their patients.
One of the world’s fastest-growing sectors, health-tech has been flourishing at exponential rates over the past several years, as it catches up with the digital revolution that has long since impacted other major sectors. A total of $23 billion was invested in the sector in the first seven years of this decade alone. According to one statistic, the US-based industry was estimated to be worth $7.2 trillion in 2015 alone[1]. While other major industries have seen a slow-down in VC funding, investment in health-tech not only continues to grow, but deal sizes appear to be increasing.
Products and services in the industry are vast, covering a wide array of needs for all the industry’s stakeholders from practitioners through to insurance providers, drug companies and consumers. Products, ranging from databases through to mobile apps and wearable devices are intended to create transparent, streamlined, personalised and safe services that enable providers to deliver competitive services, and patients to make well-informed decisions to optimise their health.
Major players in the market include the likes of publicly listed companies such as Oracle and Abbott Laboratories. Firms leading the blaze in large sector raises include the likes of Kleiner Perkins, Flare, and Bessemer, while VC arms of companies from GE to Philips and Amazon are some of the main corporate investors.
Recent years have seen significant investments in non-diagnostic digital devices or “connected health” as it is otherwise known. The kinds worn by consumers to measure their health and fitness have seen massive success – FitBit being just one example. Apps to measure, diagnose and manage diseases are also growing in popularity. Last year, Google, purchased Senosis Health, a start-up that turns smartphones into medical devices and collects various health stats, as part of its growing health technology arm.
Another area showing promising growth is the telehealth subsector, covering technologies that enable the possibility to deliver remote services, including both diagnostics and care, offering the opportunity to revolutionise the sector and provide critical services to some of the neediest patients in society. Artificial Intelligence (AI) is also thought to be a growing area of interest, as developments in technology offer the ability to compile and manage large amounts of patient data, reducing human error and improving delivery times.
In the Middle East, the potential for health-tech is significant, and governments are currently working on the regulatory environment to enable the industry to further flourish, with information security and medical liability being two of the most pressing issues. The sector is seeing a significant number of start-ups emerge. Innovations in the market that have seen success include Moroccan based Dabadoc, a telehealth, doctor-to-patient solution, which since its founding in 2014 has connected 3.5 million patients with 4,000 doctors across Morocco, Tunisia and Algeria. Egyptian start-up, Vezeeta, offers a similar service, with the application raising $5 million in 2017 in their Series-B investment. Jordan-based Altibbi, which has 1.5 million pages of medical content in Arabic and 12,000 registered doctors on its database available to provide online consultations, raised US$6.5 million, highlighting the buoyancy of the subsector.
Other industry solutions include Democrance – a UAE based start-up working to bring health insurance to the MENA region’s insurance-less population (who are thought to number up to 90% of the total population) via their mobile phone app. In October of last year, the company raised $800,000 in its first round of funding, with investors from the UAE, Saudi Arabia, the UK and Switzerland participating in the financing round.
Earlier this year, British based AI start-up Medopad, announced plans to raise $120 million in one of its early-stage funding rounds, which would be one of the largest in the UK on record. Last month, the company struck a deal with Johnson & Johnson and SAP, on the back of a visit by Saudi Arabia’s Crown Prince Mohammed bin Salman to the UK last month. Medopad’s solution has received backing from Saudi Arabia, which is looking to implement its monitoring applications, mobile technology and advanced data analytics in a bid to improve health and wellness habits among its population, namely increasing exercise levels – much needed in light of high rates of cardiovascular disease, hypertension and diabetes.
The region is more than likely to be seeing more health-tech start-ups in the future, which will only benefit from closer collaboration between engineers and medical professionals. With demand outstripping supply as the industry catches up the digital revolution and implements the latest technologies to improve patient care, the sector offers promising investment opportunities in the coming years.