E-prescriptions use a unique QR code token sent to a patient’s smartphone by a doctor which can then be scanned by a pharmacy to dispense the medicine. From this simple beginning, the use of electronic prescriptions has skyrocketed with more than six million e-prescriptions issued to Australians and almost all pharmacies around the nation having dispensed an electronic prescription.
Plans to introduce telehealth and e-prescriptions have been in the works for years but the rollout was fast-tracked to combat the COVID-19 pandemic in what the federal government described as delivering a decade worth of reform in virtual health into a few short weeks during COVID-19.
Bronwyn Le Grice, founder and CEO of digital health accelerator ANDHealth, believes Australia’s successful management of the COVID-19 pandemic coupled with our world-class reputation in health and medical research has given the country an “unprecedented opportunity” to build a world-leading digital health industry.
However, she warns that the industry is severely hampered by commercialisation challenges including access to capital, access to customers and access to expertise in areas such as regulation and reimbursement that will need to be overcome if we are to compete in the lucrative global digital health market, which is estimated to be worth $655 billion by 2025.
A recent nationwide survey of digital health companies found that only 14 per cent received venture capital financing while 38 per cent of companies were either bootstrapped or financed via family, friends and angel investors.
Le Grice cites permanent Medicare reimbursement for telehealth as a critical first step towards supporting a more sophisticated healthcare system. The government has so far only committed to extending universal telehealth through to the end of 2021.
“Telehealth is a critical platform for connecting with more sophisticated remote patient management technologies which support the prevention, diagnosis and treatment of health conditions via digital medicine and digital therapeutics technologies.”
Le Grice also called for the government to follow the United States and Germany’s lead and provide Medicare reimbursement for doctors to review remotely generated patient data from connected devices and apps.
According to a recent survey of 425 Australian digital health companies, more than 30 per cent of companies are developing technologies related to telehealth and remote patient monitoring from the home including self-management of disease, patient behaviour change and medication management.
“Without reimbursement, Australian patients and clinicians have no real incentive to take up high-impact digital medicine and digital therapeutics technologies”, Le Grice says.
“Clearer pathways to reimbursement will create a stronger environment for commercialisation and improve the health of more Australians by making world-class digital health products accessible.”
With rapidly growing challenges companies face in accessing capital, some digital health companies are turning to non-traditional finance such as crowdfunding platforms.
VentureCrowd is Australia’s largest equity crowdfunding platform with over 42,000 registered members and raising over $120 million in total volume. CEO Steve Maarbani says he is seeing a fourfold interest in digital health investments post-COVID-19 compared to the period prior.
VentureCrowd’s notable digital health exit includes 4DMedical, an Australian health technology SaaS business that has developed patented lung imaging technology. VentureCrowd investors acquired 4DMedical shares at 37¢ and the company subsequently listed on the ASX after 18 months at $1.50 per share, achieving a 380 per cent return.
Maarbani says that the digital nature of VentureCrowd’s investment platform removes the friction from the process of investing in early stage ventures, making it more accessible to the general public, particularly Millennials who are less likely to use a fund manager.
“Generally, Millennials care about purpose-driven investments with health and wellness being a big focus and want to invest digitally, so are less likely to use a fund manager. They grew up with a mobile phone in their hand and access to all the information they need on any subject at any time. So they are very comfortable making a venture capital style investment digitally.”
Maarbani forecasts that within five years, over 30 per cent of Australia’s venture capital investment will be made by individuals through crowdfunding digital platforms, providing greater exposure for digital health companies looking to raise capital.
“Feedback from our investors indicates an increased focus on health and wellness generally, and a sense of obligation to use their investment dollars to help solve entrenched healthcare problems for the greater good.”