COVID-19 highlights digital health opportunities in Asia
3 June 2020: COVID-19 has highlighted the need for continued innovation in the provision of healthcare and this will only create more opportunities for us to engage with Asia.
Realising these opportunities for Western Australia’s medical technologies and pharmaceuticals sector (MTP) was the theme of our online seminar in collaboration with the City of Perth. Australia’s MTP sector is our eighth largest exporter, with exports worth $8.2 billion in 2019.
Asialink Business is proud to have partnered with MTPConnect to develop ground-breaking research on opportunities for Australia in frugal innovation in medical devices and technologies in India and digital health in Indonesia. The learnings from this work helped frame the discussion.
The online event was moderated by Mukund Narayanamurti (CEO, Asialink Business) with an introduction by Steve McDougall (Principal, Economic Development, City of Perth).
Expert insights were provided by Dr Dan Grant (CEO, MTP Connect), Pradeep Philip (Partner, Deloitte Access Economics) and Bronwyn Le Grice (Co-founder, CEO and MD, Australia’s National Digital Health Initiative).
Export opportunities for Australia
Dr Grant said the Indian healthcare sector had grown from $60 billion in 2008 to $213 billion in 2017 – with this figure expected to further double by 2022. India also imports around 80 per cent of the medical devices it uses, presenting export opportunities for Australian medical device producers and technology developers.
At the same time, India is considered one of the world’s most dynamic centres for frugal innovation, driven by the challenges associated with delivering quality but cost-effective healthcare solutions to 1.4 billion people. This provides opportunities for Australian research institutions and companies to partner with India to develop and commercialise technologies.
Dr Grant said service flexibility was one characteristic of frugal innovation, for example machinery that could serve multiple purposes. In India he cited the use of tractors as back-up generators for hospitals.
During the COVID-19 pandemic here in Australia we have also seen manufacturers pivot to making ventilators and gin distilleries producing hand sanitiser.
Indonesia also faces many challenges in delivering healthcare services to 263 million people across an archipelago. Increasingly, digital health solutions are being found and this is reflected by the fact digital health revenues are expected to grow from $85 million in 2017 to almost $1 billion by 2023.
Innovative digital health solutions
Both India and Indonesia also have vast numbers of people connected to the internet bringing them within reach of innovative digital health solutions. India is expected to have 850 million internet users by 2030, while Indonesia currently has 170 million internet users.
Ms Le Grice said Indonesia was a large, technologically enabled population in the same time zone as Australia which brought advantages when doing business.
Australia’s new free trade agreement with Indonesia (IA-CEPA) would also help support supply chain development between the two countries.
Last year the Indonesian government introduced new regulation to reduce restrictions on business around the storage of Indonesian data. Previously, most businesses were required to store Indonesian data onshore.
The I-A CEPA will capture the benefits of any further liberalisation in this area for Australian businesses and ensure that no new requirements for onshore data storage will be introduced.
The agreement will also remove the requirement for Australian software suppliers to provide the source code for their software to the Indonesian government if they want to import, sell, distribute, or use software in Indonesia. This will provide greater confidence around the protection of intellectual property.
Ms Le Grice said that COVID-19 had definitely shone a light on digital health and cited investor research by Rock Health which identified telemedicine, remote monitoring, symptom checking and digital therapeutics as areas positioned for greater growth than originally anticipated because of the pandemic.
She said for Australian medtech and pharma were traditional strengths and digital health was an emerging third pillar – in addition to digital therapeutics and digital medicine – and that we needed to focus on particular areas where we had a comparative and competitive advantage.
A new world order emerging
Mr Philip said Australia was positioned to benefit from the new world order that was emerging in which growth and trade was increasingly shifting to our region. By 2030 the Asia Pacific is expected to be home to 65 per cent of the world’s middle class.
Mr Philip said COVID-19 had seen economic growth in India decline to its lowest levels in 11 years, yet the underlying drivers of future growth were undeniable.
India has a young population, is seeing significant income growth and has been heavily focused in recent years on policy reform to address inequality, upskill its workforce and to improve the ease of doing business.
Mr Philip said Australia needed to do more to develop its relationship with India pointing to relatively low levels of Australian investment in India and a fairly basic trade composition.
He said we needed to remember that India was carving out its own future and would not wait for anyone and therefore Australia needed to be proactive. We should be looking to build long-term relationships and not just transactional relationships.
For states like Western Australia there was scope for collaborative growth in the R&D space and specifically, clinical trials presented new opportunities.