The Business Times (10 November 2023)
Healthtech startups founded in
Asia are making headway overseas,
but the path to profitability is
less clear in their hometowns.
While startups selling consumer
products and solutions can grow
their markets with clever marketing
or discounting, startups in the
healthtech space need to get buy-in
from healthcare practitioners and
regulatory bodies – both private
and public.
Doctors need to be convinced
by studies showing a solution’s efficacy,
or time saved. Governments
need to be persuaded that the startup’s
product is safe, or effective.
Insurers need to be won with evidence
of cost efficiency.
Healthtech startup Lucence
knows something about the differences
between Asia and the United
States.
The company, which offers
blood tests for cancer screening,
has secured insurance coverage in
the US for one of its lung cancer
tests. This means certain patients
who take the test can now be reimbursed
under the national insurance
scheme Medicare.
Lucence founder Dr Tan Min-
Han said: “Because there is a path
for national insurance in the US to
recognise technologies and drugs,
there is a progressive adoption in
the US.”
Asia has a less defined healthcare
payer ecosystem, he said, with
no clear road maps to adoption.
Being able to demonstrate progress
along a clear pathway might
also help a healthtech startup with
its fundraising.
Lucence recently raised a US$45
million Series A extension led by
family office Chen Capital, Open-
Space Ventures, Parkway Holdings
and Heliconia Capital. The funding
will be used to seize opportunities
to expand its multi-cancer screening
solution across Asia.
Securing funding is particularly
tricky now, as higher interest rates
give investors safer options.
Early-stage health and biomedical
startups raised US$121 million
in 2021, a report by SGInnovate indicated.
It fell to US$89 million in
2022, in line with the tougher funding
environment that startups
were facing.
Regulatory hurdles are just the
start.
Pang Sze Yunn, chief executive
of Neurowyzr, a healthtech startup
that tracks cognitive decline, said
approvals do not sell solutions.
Startups still need to articulate
the value of their solutions to the
healthcare system, she said.
Mesh Bio, a startup selling predictive
analytics to manage chronic
diseases, is trying to do just that.
It is working with two hospitals –
Singapore General Hospital and
Tan Tock Seng Hospital – to quantify
the cost of kidney disease.
By showing how much patients
have to spend, as well as the social
and economic impact, Mesh Bio
hopes to convince insurers that its
solution is worth the cost.
The company’s co-founder and
CEO Dr Andrew Wu said: “We recognise that the road map to adoption
and health economics is certainly a
very important part of demonstrating
value.”
In Singapore, at least one entity
is working to bridge the gap between
the healthtech startups and
the healthcare industry.
The Centre for Healthcare Innovation
(CHI), a government initiative
that aims to promote innovation
across the public healthcare
system, has come up with a framework
to evaluate healthtech solutions.
Dubbed the CHI Evaluation Framework,
its factors include costbenefit
analysis, usability, and IT
integration – all elements that are
not typically part of a clinical trial.
Professor Tan Cher Heng, executive
director at CHI, said: “What
we do is to measure the value of the
innovations when they are adopted.
In doing so, we can then advise
the decision makers on whether we
should invest into those products
more heavily or procure them for
the long-term.”
There is some international
benchmarking for the framework,
Prof Tan said, with advisory members
coming from across the globe.
“The idea is that we want to create
a standardised and fairly holistic
way of assessing a healthtech
solution,” he said.
Neurowyzr’s Pang said she is
optimistic, as such a system could
help put both the solution provider
and evaluator on the same page.
A framework to quantify savings
from using a healthtech solution
would help startups looking to
break into the healthcare system
here and even abroad, she added.
“Even regionally, it gives a framework
on how to approach and
think about quantifying value for
the smaller startups.”