To build Shopify-like healthtech companies, Ontario must create more incentives

Medical Staff

As a passionate advocate for a more technologically advanced and sustainable healthcare system that produces better patient outcomes, and a co-founder of a digital health startup headquartered in Ontario, I know how challenging it can be to build and grow innovative healthcare businesses in this province.

OBIO’s report titled Use It Or Lose It: Industry Solutions for Ontario’s Commercialization Gap hits the nail on the head for how to address the biggest barriers to growth faced by emerging health technology industry companies in the province.

Although all of the recommendations in the report are equally important, an absolutely essential one is the need for homegrown anchor companies that help to democratize market opportunity. More specifically, Ontario needs large companies that are able and willing to create access to opportunities for smaller emerging companies through their size, reach and/or privileged access.

Now, more than ever, health technology needs to be the force of change that will ensure the sustainability of our publicly funded healthcare system.
 

Drawing from our experience in a highly-controlled healthcare system, smaller companies like ours are often walled off from the underserved markets we aim to reach. Access to essential necessities–like systems and data–is very difficult to obtain (if at all possible). The presence of an open-minded and collaborative anchor company has the potential to transform this reality entirely. A great example of this in the ecommerce space is Shopify, which as a platform has opened doors to ancillary opportunities for thousands of businesses, to the benefit of customers.

The challenge is, admittedly, that being open to collaboration on the part of large anchor companies is not mutually beneficial. In a single payer public system, monetizing collaboration projects in healthcare—to a level that makes sense for large anchor companies to divert and allocate resources into new and novel initiatives—rarely pays off in the short and medium term. Additionally, risk profiles for collaboration projects are often high, although the potential opportunity and reward may be high as well.

As a result, in order to create the right environment—one that promotes the establishment of Shopify-like companies in healthcare—it is critical that the province builds an incentive structure that emphasizes opening blocked off healthcare market opportunities for emerging companies.

healthtech

To exemplify the need further, let’s discuss digital health, which is our area of focus. In this segment, the greatest opportunity lies in the integration of fragmented systems that do not communicate with one another (for example, Electronic Medical Records and virtually every other application). The integration of these systems has the potential to completely change the healthcare system–from one that is provider-centric to one that is patient-centric–by improving patient access, control, and potential use of healthcare information.

By properly incentivizing the conversion of systems such as Electronic Medical Records from applications to open access platforms, patients, providers and emerging innovations are presented with significant opportunities to get more value from the system. It’s encouraging to see some anchor companies in the space start to move in this direction, but until incentives are properly aligned, progress will be slow.

There are several ways to build a strong system that offers the right incentives, and in the past, various models have been used, from grants to tax rebates. The critical part to ensure is that any program implemented is financially meaningful for anchor companies, emphasizes accountability for driving towards an open market, and is relatively simple to navigate.

Now, more than ever, health technology needs to be the force of change that will ensure the sustainability of our publicly funded healthcare system. With a strong collective effort, led by initiatives such as the OBIO industry consultation and ground-breaking report, there is great potential to drive change. With the right policies and structures supporting collaboration and the growth of open-minded anchor companies, Ontario has the potential to become one of the best places to build and grow healthcare businesses. And ultimately, this will ensure patients have access to the best care possible, and an innovative and sustainable healthcare system in the long term.

Photo via Burst.

Vikram Luthra

Vikram Luthra

Vik is the Co-Founder & CEO of Avocare, a Virtual Care company that is committed to building a better future for healthcare. An experienced leader and repeat entrepreneur with over a decade of broad-ranging business experience across a variety of sectors including media, technology and healthcare, Vik is a keen advocate for advancing the use of technology in healthcare and modernizing patient experiences. With many close family members working in the healthcare sector, Vik offers a unique perspective to the challenges that face healthcare today. Vik is a CPA (CMA) by profession, and beyond his involvement with Avocare, is active as a leader in the healthcare sector.