By Shweta Mani (PGP 1999)
The Theme of IIMPACT HEALTH 2021, conducted virtually on 16-17th September was “Global Shifts, Disruptions, and the Age of Unicorns: Scaling Healthcare Innovation in India.” It was attended by 1780 unique participants over both days.
After the success of IIMPACT Health 2019, which had explored the rise of Digital Health, we wanted to explore what it takes to successfully scale healthcare start-ups in India, and what opportunities and challenges the covid pandemic had thrown open for the healthcare start-up ecosystem.
While a virtual conference brought its challenges in terms of zoom fatigue, and taking away the ability to network and interact, it also provided us the opportunity to make IIMPACT Health truly global. Our speakers and panelists were thought leaders from not just India, but from US, UK, Canada and Hongkong, as well.
Welcome Address and Context Setting Kicking off the welcome address, Amit Mookim, CEO of IQVIA & President of TiE, underscored why healthcare innovation is sorely necessary in India. He spoke about how India lags behind on all 3 ends of the healthcare triage: Quality, Access and Affordability.
Prof Saral Mukherjee, Dean of Alumni and External Relations at IIMA and Prof in Production and Quantitative Methods at IIMA, spoke about how platform companies are disrupting traditional ‘pipeline’ based businesses across industries. Platforms are asset lite aggregators who use data to understand customer needs and provide a customised experience to every customer. In addition to platform based business models, the trends disrupting other industries were D2C business models and the rise of supply chain analytics to streamline and optimise the supply chain. While the Healthcare industry has been somewhat of a laggard, Prof Saral mentioned that healthcare was ripe for disruption, and the traditional businesses should be ready for the impending change.
Opening Keynote The opening keynote “Healthcare Trends for the Post Pandemic Decade” was delivered by Axel Baur- Senior Partner and Healthcare Practice Leader at Mckinsey, based out of Hong Kong.
Axel’s talk focussed on the rise of Digital Health Ecosystems across the globe – whose growth and adoption has been accelerated due to the pandemic. These are integrated, tech enabled, omni-channel ecosystems that are engaged in care delivery through a combination of Remote Monitoring, Remote Care Delivery, Care-Coordination and Patient Care Management. Digital Health Ecosystems are growing swiftly at a CAGR of > 20% across APAC, and already touch close to 1.4 billion lives in Asia alone.
Scanning across the world, Axel categorised the Digital Health Ecosystems into 6 different archetypes: primary care management ecosystems (e.g., Teladoc, Pharmeasy), chronic care management systems (e.g., Livongo ), prevention and care management (e.g., Cleveland Clinic), specialist care systems (e.g., Alodokter), Genetics and Precision Medicine Systems (e.g., Roche ) and Wellbeing platforms (e.g., AIA Vitality).
Speaking specifically about India, Axel Baur mentioned that Digital Health would grow from penetration of 2% to around 15% over the next decade, growing at a CAGR of 35%, with e-pharmacies and teleconsultations being the primary growth drivers.
He closed his talk by highlighting key learnings from successful digital health start-ups (See image)
Building Scalable Innovation: A VC perspective, A Panel Discussion The VC Panel was a truly global one that brought together Healthcare VCs & PEs from across North America, UK and India.
The panel was moderated by Jaivir Pall, co-founder of harbr.io – a healthcare accelerator based in the UK. The panelists included Alka Goel, Founder of Alkemi Growth Capital – a healthcare and wellness fund based in New Delhi; Lavanya Bhamidipati from Inhealth Ventures: A London based, early-stage, trans-Atlantic VC fund; Ashish Venkataramani, a partner with 8 Road Ventures, a global PE investing in healthcare and Technology and Sanjana Basu from Radical Ventures – a North America based AI focussed fund.
On the topic of how the pandemic had impacted the VC process, the consensus was that traditional barriers of physical location, cheque size and even watertight sectoral focus in the VC ecosystem have been breaking down, and so VCs are open to looking at a wider variety of opportunities, expanding the pool of VCs that start-ups have access to.
On the topic of strategies deployed to achieve scale, the examples quoted included acquisitions, building for the global healthtech market, to digital health platforms creating virtuous loops where new patients bring new providers/physicians on board, who in turn bring new patients, thereby creating rapid scale.
How Corporates Are Innovating: Panel Discussion The Panel on Corporate Innovation was moderated by Prof. Vishwanath Pingali, Faculty Co-ordinator of IIMA Healthcare ASIG. The high powered panel included Umang Vohra – MD & Global CEO, Cipla, Shravan Subramanyam: President and CEO, GE Healthcare India & South Asia and Sanjay Murdeshwar, Vice Chairman & MD, Novartis.
Active partnerships with start-ups emerged as a common mechanism by which large corporations tap into the innovations that start-ups offer. However, each company employs a slightly different strategy to evaluate and select which start-ups to partner with. While Novartis seeks out start-ups that are working on problems that it seeks to solve for itself across its value chain, Cipla looks at innovation across two axes – business model innovation & product/science based innovation, and finds start-ups that offer one or the other in a disruptive fashion. GE on the other hand runs an accelerator program, where it picks start-ups based on a particular theme, incubates them and helps them achieve scale.
On how covid had changed the sales/physician engagement model, Umang spoke about the rise of on-demand digital content which was a driver of digital engagement with the physician, and digitization of the channel in terms of payments, inventory ordering etc.
Sanjay opined that the future of customer engagement would be where the rep is like Ironman – a superpower individual with access to data, information, and tools to enrich his interactions with the physician in a meaningful way. The face to face interaction would get enriched, it would not vanish.
Shravan threw light on the changes in the med devices industry where a large part of the touch-point – service had been turned on its head because of Covid. It had gone virtual with human interaction based training had vanished to be replaced by virtual interactions and the use of AR/VR Tools.
On what start-ups need to do to scale successfully, some themes that emerged were
1. A truly differentiated idea
2. Business Model Clarity
3. The right unit economics
4. Data Interoperability, that breaks through the fragmentation of the healthcare systems
5. Increased access through use of technology, skills and logistics
Winning in India: Models for Success – A Panel Discussion The Indian Start-up Panel was moderated by Rashmi Bansal – Author, Entrepreneur & Visiting Professor, Ashoka University and had founders from arguably India’s most successful healthtech start-ups – Pallavi Jain – Managing Director, Krsna Diagnostics Ltd, Hardik Dediya, Co-Founder, Pharmeasy, Manish Gupta – Co-Founder & CEO, Indegene and Rizwan Koita – CEO, Citius Tech.
On what made each of them unique or different in their business model, Krsnaa mentioned purpose – the ability to give back to society, choice of the customer – rural/semi-rural customers who had the largest gap in access and the greatest need, and the model – use of public private partnerships to achieve scale, as key differentiating factors. Krsnaa operates in 14 states and serves 27 million customers.
Indegene mentioned using a digital first approach to help life sciences manage all essential commercialization processes that life sciences companies need. They offer process automation that helps companies manage the complexity of rolling out a drug in multiple geographies each with their own nuances.
Citius Tech was set up with the core assumption that deep domain expertise is a strong differentiator when it comes to technology services in healthcare. Citius designs and builds enterprise grade applications which deal with patient information, and deploy the use of AI/ML on top of the data, and they work across 4 verticals – Technology companies (e.g. EMR systems), Hospital Systems, Health Insurance companies and Life Science Companies.
Pharmeasy differentiated itself in the epharmacy space by first working to consolidate the supply chain which helped them build a deeper understanding of the business. The other differentiator was a customer centric, data driven culture which helps them grow faster.
On the impact of covid, all companies spoke of a surge due to a surge in home collection (for diagnostics), rapid adoption of digital health by retail customers, and digital transformation by companies. As Rizwan pointed out, being digitally innovative went from being a market leadership criterion to a survival criterion for companies.
All the entrepreneurs had important advice on what it takes to build a successful company in the healthcare space. The advice included being married to the problem, but being flexible about the solution; having grit and patience as one tends to overestimate what is possible in 1-2 years underestimate what one can do in a decade; treating profit and valuations as a byproduct of the service you provide and not as the end goal; and staying true to your ethics and having customer empathy as there are serious consequences to seemingly trivial mistakes in the healthcare space.
The final message was that the next decade presents many opportunities in India for aspiring healthcare entrepreneurs who are willing to get their hands dirty, get into the trenches and solve problems with grit and patience.
Building a Global Unicorn: A Panel Discussion The Silicon Valley Unicorn Panel was a power packed one. It was moderated by Dipty Desai – PhD (Board Member, IIT Bay Area Alumni Association) and had Anmol Madan Chief Data Scientist, Teladoc Health, Mahesh Karande – President & CEO Board Director, Omega Therapeutics and Kanav Hasija, Co-Founder & Chief Customer Officer, InnovAccer.
On what it takes to build a global unicorn, the successful entrepreneurs all had valuable advice.
1. You need to have purpose, emotional resilience and believe in the vision.
2. Be flexible and open that the details will change
3. Track the right outcome metric and systematically remove all bottlenecks that come in the way of scale and speed
4. Do not expand too early till you have sustainably proven outcomes in one geography
5. Be honest with yourself – don’t fall for the pitch you sell to the outside world.
6. Company is a direct result of the people you manage to bring in. Hire the right talent that fits the company
7. Build a culture that allows people to do the work they are hired to do. Talent retention is about building a culture where people have ownership
8. Investors invest in Idea and the team
On the topic of Emerging Global Healthcare trends, the ideas that emerged were
1. Behavioural Health
2. Telemedicine and Remote Care
3. Healthcare Data, Sensors, AI
4. Care at Home
5. Solving for local healthcare challenges in large markets
– US: Cost of Care
– India: Healthcare Access, Data Capture
– China: Ageing
Closing Fireside: Kiran Mazumdar Shaw’s Journey IIMPACT Health 2021 was fortunate to host Ms Shaw as the speaker for the closing fireside. The closing fireside was a conversation between Ms Kiran Mazumdar Shaw and Amit Mookim.
Ms Shaw has some strong advice for Indian VCs. She highlighted that if India needs to innovate, VCs need to invest in risky high science. This does not exist today, due to the risk and uncertainty involved. She gave the example of Moderna which was able to pioneer a brand new mRNA technology and pivot its research when Covid hit to develop a vaccine. This not only saved many lives, it created significant value for its investors, when its market cap went from 7 Bn to 150 Bn in barely two years.
She also spoke about how the credibility challenge shifts across the company lifecycle, but the need to build credibility never stops. She had many nuggets of advice for entrepreneurs gleaned from her own journey.
1. If you keep knocking on doors, and talk about your idea with passion, one door will eventually open.
2. Once you convince intellectual capital to your company, you have won
3. The journey of entrepreneurship is one of value creation. Value creation happens through differentiation and innovation. Me too models can succeed too, but their ability to create outsized value is limited.
4. When you are trying to be different, you are trying to lead, not follow. Which means higher risk. Therefore, your risk appetite as an entrepreneur needs to be high as well. Not everything you try will work out.
5. In biotech, building IP is an integral part of the business
6. Don’t just build for India, build for the world. It is expensive and high risk, but worth it.
7. There are plethora of opportunities in healthcare – from non-invasive diagnostics; AI based solutions that cut down time to read a scan; unmet needs in cancer, infectious disease and vaccine platforms; downstream processors of biologics; green technologies for small molecules; opportunities in services among others. Don’t go for tried and tested ideas. Some of them can be unicorns.
Start-up Pitches In addition to the speakers and the panel discussions, IIMPACT health also had start-up pitches from two innovative healthcare companies: Pacify Medical which aims to transform how skin grafts are done in burn patients, and AktivoLabs – a digital health platform that uses real time data from wearables and mobile phones to predict and prevent chronic diseases like diabetes and CVD.
There were also two child entrepreneurs from YEA! who pitched their business ideas as well.
Closing Address, Vote of Thanks and Sponsors The closing address was delivered by Mr Sudarshan Jain, Secretary General IPA and Alumni Representative for the IIMA Healthcare SIG, and the Vote of Thanks was delivered by Anurag Choudhary, AVP and HOD, Alumni Relations and External Affairs.
IIMPACT Health was made possible by the generous support of the sponsors: Abbott Laboratories, Indegene Pvt. Ltd, Gautam Narayan of Apax Partners, AWS, and 9Unicorns.