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The Future of Diabetes Care Key Innovations in the Continuous Glucose Monitoring by EOS Intelligence
by EOS Intelligence EOS Intelligence No Comments

The Future of Diabetes Care: Key Innovations in the Continuous Glucose Monitoring

Continuous glucose monitors (CGM) represent a disruptive innovation that has transformed the diabetes management landscape. In recent years, the CGM market has seen remarkable growth, becoming an integral part of diabetes care with the potential to supplement or even replace traditional blood glucose monitoring methods. Opportunities in the CGM sector are endless, as the market remains under-penetrated. Market leaders such as Dexcom and Abbott leverage this potential to establish their foothold while continuously innovating their offerings.

CGMs provide accurate readings that can be used for insulin dosing decisions, eliminating the need for traditional fingerstick tests. The devices offer high ease of use and convenience, with many integrating seamlessly with smart devices. Additionally, the increasing use of AI and machine learning has led to the development of algorithms that customize health-related data for users.

Read our related Perspective:
Continuous Glucose Monitoring Devices: Overcoming Barriers in LMICs 

As we expect the next generation of CGMs, revolutionary advancements promise to transform diabetes management with these devices. The ongoing innovations aim to enhance precision and accuracy, offer predictive analytics, provide continuous monitoring beyond glucose, and enable the integration of other health parameters into the CGMs.

Precision and accuracy

Building on the success of current CGMs, the next-generation devices are likely to offer unprecedented precision and accuracy. Upcoming CGMs will use next-generation sensor technologies, including advanced nanomaterials and multi-enzymatic systems, to detect glucose levels with higher sensitivity and specificity.

Sophisticated AI and machine learning will support the prediction of glucose trends and real-time data processing to increase accuracy. To further improve accuracy across diverse populations and glucose ranges, emerging CGMs will leverage personalized calibration algorithms that adapt to individual metabolic variations.

Integration with broader health ecosystems and cloud-based analytics will be industry players’ key focus, ensuring improvement through real-world data feedback. Clinical validation and regulatory supervision will ascertain that CGMs adhere to all safety and health standards.

Overall, players will aim to provide reliable glucose data to empower users with actionable insights for effective diabetes management. Leading industry players, such as Abbott and Dexcom, prioritize data accuracy and ensure that their devices track glucose trends accurately with minimal error. For instance, Abbott’s Freestyle Libre uses advanced sensor technology to maintain accurate glucose readings over a 14-day wear period. On the other hand, Dexcom’s G7 utilizes advanced algorithms to continuously calibrate and refine glucose readings based on real-time data and historical trends, eliminating the need for fingerstick calibrations. Both devices provide real-time alerts on glucose levels to help users take action.

The Future of Diabetes Care Key Innovations in the Continuous Glucose Monitoring Market by EOS Intelligence

The Future of Diabetes Care Key Innovations in the Continuous Glucose Monitoring Market by EOS Intelligence

Integration with smart devices

Anticipated advancements include seamless connection with smartphones, smartwatches, and other wearable devices for uninterrupted glucose monitoring. Such integration will not only elevate user experience but also allow real-time updates, such as alerts for glucose fluctuations, viewing historical trends, and sharing data with healthcare providers, thus facilitating proactive management of user’s condition.

In advanced CGMs linked with mobile applications, predictive algorithms will be able to foresee glucose levels, offering tailored suggestions and insights based on individual patterns. Recently, in June 2024, Dexcom enabled a direct-to-watch feature, allowing its G7 users to monitor real-time blood sugar data from an Apple watch, regardless of whether they are carrying their phone.

In the future, this synergy between CGMs and smart devices will not only improve the accuracy and accessibility of glucose monitoring but also empower users to make quick, informed decisions regarding their health and improve overall well-being.

Predictive analytics

The real-time and historical analysis of glucose data equips CGMs to predict blood glucose levels several hours ahead, notifying users about impending hypoglycemia or hyperglycemia before they occur. This proactive approach allows for timely interventions, such as regulating insulin dosage or dietary modifications to maintain optimal glucose level.

Predictive analytics integrated with CGMs is revolutionizing the diabetes care market, and key market players are increasingly prioritizing its incorporation into their devices to gain a competitive edge. Roche is gearing up to compete with Abbott and Dexcom with its Accu-Chek Smartguide, which will soon be launched in the European market following its approval in July 2024. The company is betting on robust predictive analytics to differentiate its product from competitors. The device aims to enhance glucose monitoring by employing predictive AI to forecast glucose levels up to two hours ahead, identify the risk of low blood glucose within 30 minutes, and detect nocturnal hypoglycemia.

Over the years, as predictive algorithms improve, CGMs will become increasingly suitable for mitigating risks, reducing glucose spikes in patients, and equipping patients to manage diabetes better and improve quality of life. In the future, enhanced personalization and seamless integration of CGMs with broader health ecosystems can transform diabetes management by providing more precise and accessible real-time insights and recommendations tailored to individual metabolic responses, lifestyle patterns, and environmental influences. It is likely that the next generation of CGMs will also predict and adapt to potential disruptions caused by stress, illness, or diet changes.

Product diversification

The evolution of CGMs is expected to go beyond glucose monitoring, embracing a holistic approach focused on personalized and preventive healthcare. Companies are conducting research to integrate CGM readings with health metrics such as ketone levels, hydration status, and early indicators of other health conditions.

Industry players are also developing targeted solutions for various customer segments. For instance, they are focusing on pediatric and geriatric populations by creating CGMs customized to meet these segments’ unique physiological and lifestyle needs. Another area of focus is developing CGMs to support gestational diabetes, helping pregnant women better manage maternal and fetal health.

Currently, companies such as Medtronic and Abbott have partnered to integrate Medtronic’s automated insulin delivery systems with Abbott’s CGM to create closed-loop systems. This system automatically adjusts insulin delivery based on real-time glucose readings, which helps patients improve glycemic index.

EOS Perspective

The next generation of CGMs is poised to help manage of chronic diseases beyond diabetes. With key players such as Dexcom and Abbott maneuvering the industry, the future promises unprecedented advancements through the fusion of technology and healthcare. The impact on patient outcomes and the broader healthcare landscape will lead to a more personalized, proactive, and interconnected approach to care.

There is a significant opportunity for industry players across major markets such as the USA, where CGM adoption remains low, with about 90% of people with diabetes still not using these devices. To penetrate key markets including the USA and Europe, CGM companies need to develop effective go-to-market strategies to increase adoption rates. They should focus on patient segmentation, exploring multiple distribution channels, and forming alliances with key stakeholders.

Patient segmentation

Sales strategy and product offerings could be tailored around specific patient groups, i.e., Type 1 versus Type 2 diabetes or various income levels. For example, Abbott has strategically developed different CGMs to target varied patient groups. Its FreeStyle Libre is designed for users with Type 2 diabetes, while Lingo, a consumer wearable, is ideal for consumers trying to improve overall health and well-being.

Diversifying distribution channels

The CGM players must diversify their distribution channels, particularly by utilizing digital marketing and social media to reach a broader audience and increase awareness. Digital marketing can also serve as a crucial tool for connecting with diabetes online communities and educating patients.

Abbott and Dexcom are looking to explore new distribution avenues. In H2 2024, both companies rolled out their competing products (Abbott’s Lingo and Dexcom’s Stelo) over-the-counter in the USA, selling through their websites, with an aim to expand the reach and enhance market penetration. Expanding sales through the online channel also makes it simpler for consumers to purchase CGMs directly from producers simpler for consumers.

Partnerships

Forging strong alliances with key stakeholders can create improved and integrated diabetes management systems. Strategic partnerships with technology companies can help CGM players enhance products, expand market reach, and improve patient outcomes. On the other hand, partnering with insulin pump and insulin pen companies can streamline diabetes care by combining real-time glucose monitoring with automated insulin delivery.

Both Abbott and Dexcom have partnered with Tandem Diabetes Care to integrate FreeStyle Libre CGM and G6 CGM, respectively, with Tandem insulin pumps. These systems use real-time glucose readings to automatically adjust insulin dosing, improving diabetes management.

The opportunities in the CGM market are vast and continually expanding. As technology advances, CGMs will become more accurate, user-friendly, and integrated with other health management tools. Moreover, with the growing prevalence of diabetes worldwide, the demand for efficient and effective glucose monitoring solutions will only grow in the future, making the CGM market an attractive segment for continued investment and development.

NVIDIA's Meteoric Rise Can the AI Chip Giant Sustain Its Dominance by EOS Intelligence
by EOS Intelligence EOS Intelligence No Comments

NVIDIA’s Meteoric Rise: Can the AI Chip Giant Sustain Its Dominance?

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NVIDIA has grown exponentially in recent years. The company made significant strides as an early entrant into the AI chip market, becoming the sector’s leading company. In July 2024, NVIDIA’s market cap was US$2.9 trillion, registering 137.1% growth over 2023, making it the world’s third most valuable company behind Microsoft and Apple. As AI development continues its upward trajectory, big tech companies are focusing on developing their AI capabilities more than ever, posing a threat to NVIDIA’s dominance in the AI chip market.

Over the past decade, NVIDIA has evolved from a gaming GPUs maker to a leader in AI and data centers. The company’s early venture into the computing space coupled with continuous development of its cutting-edge technology helped the company solidify its position as the pioneer in the fast-growing AI training and inference market.

According to Mizuho Securities, a Japanese investment and securities firm, NVIDIA holds 70-95% of the advanced AI chip market share in 2024. Despite being the leading firm and major shareholder in the booming AI chip market, NVIDIA started to face rising competition and regulatory scrutiny that challenge its dominance.

Regulatory scrutiny poses a threat to NVIDIA’s market strategy and dominance

NVIDIA’s dominance has caught the attention of regulators worldwide, with antitrust investigations underway in the USA, EU, and China.

The acquisition of ARM, a UK-based semiconductor company, was scrutinized by regulators in multiple countries and was terminated in 2022. This was due to competition and control of key technology. Qualcomm, Google, and Microsoft opposed the deal because of concerns over fair access to ARM’s technology and fair industry practices.

This increased scrutiny may limit NVIDIA’s ability to offer products and services and impact its strategic expansion plans and market dominance.

NVIDIA's Meteoric Rise Can the AI Chip Giant Sustain Its Dominance by EOS Intelligence

NVIDIA’s Meteoric Rise Can the AI Chip Giant Sustain Its Dominance by EOS Intelligence

Competitors are increasingly vying for NVIDIA’s AI chip market share

The global AI chip revenue is projected to reach US$33.4 billion in 2024, per the Gartner market report, making it a lucrative space to operate in. Major tech companies are investing in AI chip development to compete and break NVIDIA’s monopoly in the market.

Through partnerships, innovation, integrated solutions, and niche offerings, competitors are shaping a competitive landscape that will continue to democratize and push AI tech forward. As the AI computing industry will see unprecedented growth, NVIDIA’s competitors are positioning themselves to capitalize on the emerging opportunities.

Tech companies are investing heavily in their AI chip development capabilities

The generative AI boom has exposed how much the big tech companies depend on NVIDIA. NVIDIA’s biggest customers (Microsoft, Google, Amazon, and Meta Platform), which account for over 40% of its revenue, are building their own AI chips to reduce their dependency on NVIDIA.

Amazon, through AWS, offers its own AI chips, Inferentia and Tranium, as cost-effective alternatives to NVIDIA’s chips. Google has been using its tensor processing units (TPUs) since 2015 and recently announced its Trillium chip. Microsoft is building its own AI accelerators, Maia and Cobalt, and Meta is building its own AI chips for more efficiency.

Among all competitors, Intel is likely to emerge as a core competitor to NVIDIA in the AI chip market, leveraging its experience in making CPUs and GPUs. Intel is challenging the company’s dominance in the AI processor market with the Gaudi accelerator AI chip, which costs one-third of NVIDIA’s GPUs.

Intel is focusing on edge devices, such as smartphones, that utilize smaller language models (LLMs) as part of its “AI everywhere” strategy.

NVIDIA is dominating the fast-growing cloud data center market. Intel’s approach of not replicating NVIDIA’s business model but leveraging its broader technology portfolio is likely to provide it with a competitive edge and a chance to compete with NVIDIA.

AI processing shift to edge devices challenges NVIDIA’s market share

Another challenge for the company is the shift in AI processing from data centers to edge devices such as laptops, PCs, and phones.

Large companies, including Apple and Qualcomm, are updating their chips to run AI models on these devices with neural processors for privacy and speed. Apple’s latest devices are AI optimized, and Qualcomm’s new PC chip allows laptops to run Microsoft AI services on-device.

For NVIDIA, adapting to this new paradigm will be important in the long run. As edge AI grows in demand, the company must innovate and compete in this fast-changing market to remain ahead of the competitors.

Investor-backed startups are making strides in the AI chip market

Many new entrants and growing companies are also competing in the AI chip market with innovative approaches and niche solutions.

Startups, such as Graphcore, Cerebras Systems, Groq, and SambaNova Systems, are building specialized AI architectures to outperform traditional GPUs in specific AI tasks. These startups are backed by strong venture capital and strategic partnerships, providing them with resources to enhance their R&D capabilities and scale much faster. For instance, Grog, a startup in the AI inference market, secured US$640 million and claims to have developed an AI chip faster than NVIDIA’s at a much lower price.

The surge in capital investment is likely to support startups in developing new AI chip solutions and carve out a niche for customized AI workloads. This way, startups can tap into new customers seeking customized chips for specific solutions.

Amidst the competition, NVIDIA is expected to leverage its early head start in the AI chip business and will likely focus on its core strength of developing advanced chips.

Nvidia’s strategic investment in startups strengthens its robust ecosystem

NVIDIA has created an ecosystem that makes it hard for competitors and customers to switch away. Key components of this ecosystem include strategic investments in startups, software bundling, and partnerships, creating a robust and interconnected web.

NVIDIA’s venture capital arm, NVentures, plays a crucial role in product innovation by investing in startups across various industries.

In addition to financial support, NVIDIA also offers these startups access to its technology and expertise to foster innovation and accelerate product development. For example, NVIDIA Inception, a global program, supports startups by providing technology and marketing support, connecting them with venture capitalists, and giving them access to the latest technical and financial resources.

Investing in promising startups provides NVIDIA with early access to emerging technologies and potential market disruptors. This enables the company to integrate the next big technologies into its products or develop new products that keep it ahead of the competition. It fuels innovation and creates a network of companies that dependent on NVIDIA’s technology, making it hard for them to switch to competitors.

NVIDIA’s seamless hardware-software integration provides a competitive edge

Software bundling is another way NVIDIA strengthens its ecosystem. The company often bundles its hardware with proprietary software, making its products better and more functional. This software is frequently optimized for NVIDIA’s hardware, so customers cannot switch to competitors without losing access to this software. The strategy of bundling often leads to better performance and value for customers, making NVIDIA’s products more attractive.

NVIDIA’s software ecosystem, particularly CUDA (Compute Unified Device Architecture), plays a vital role in its dominance. CUDA only works with NVIDIA’s chips, and over 3 million developers use it to do AI experiments and develop applications. NVIDIA also updates its software annually with new AI chip architectures and software. The company’s continuous innovation ensures its hardware and software are always in sync, so customers stay within the NVIDIA ecosystem.

NVIDIA’s strategic partnerships enable tech integration across sectors

NVIDIA has partnered with companies ranging from tech giants to startups and helps them develop and optimize their software for their hardware. This has created a network of companies across various industries whose products and services are deeply tied to NVIDIA’s technologies.

NVIDIA’s strategy to form partnerships and integrate them into its network of systems and software is beneficial to both parties. Switching to other competitors would incur significant costs and disruptions for customers. NVIDIA’s industry-wide partnerships help it have a strong and integrated ecosystem. For example, partnerships with AWS, Microsoft Azure, and Google Cloud allow NVIDIA to integrate GPUs into the cloud and make their technology available to all enterprises and developers.

In the automotive space, partnerships with Tesla and Mercedes-Benz put NVIDIA’s AI and GPU into autonomous driving, making them rely on NVIDIA AI solutions. Further, partnerships with large enterprises, such as IBM and VMware, to optimize hardware and software make NVIDIA the preferred partner for advanced computing in data centers and AI applications.

NVIDIA’s dominance may lead to increased costs of manufacturing AI chips

NVIDIA’s dominance is likely to significantly impact the world’s largest contract chip maker, TSMC (Taiwan Semiconductor Manufacturing Company), and the entire semiconductor industry.

NVIDIA is TSMC’s key customer, and the latter dedicates a big part of its production capacity to NVIDIA. NVIDIA’s pricing power impacts TSMC’s margins, and if NVIDIA decides to squeeze its suppliers to maintain its margins, TSMC is likely to feel the heat on its profitability. This could lead to capacity constraints for other customers, which will delay their product launches and drive up the prices of AI chips.

An increasing demand for AI chips from NVIDIA and others will drive up the cost of raw materials and components. This cost increase may trickle down the supply chain to end consumers. NVIDIA’s dependence on TSMC makes the supply chain vulnerable to disruptions due to China’s multi-pronged pressure on Taiwan.
NVIDIA’s dominance could drive consolidation in the semiconductor industry

NVIDIA and other companies may diversify their supply chain to mitigate the risks associated with geopolitics, supply, demand, and prices. This could lead to partnering with multiple foundries and geographic diversification. Some semiconductor companies may go for vertical integration to have more control over the value chain.

NVIDIA’s dominance and financial muscle may lead to consolidation in the semiconductor industry. Companies lacking financial resources may find it challenging to compete with big tech companies and could potentially get acquired by larger AI chip manufacturing companies.

Companies in the automotive and electronics sectors that rely on semiconductors may face procurement challenges due to supply shortages. This may lead to prioritizing high-margin products and potentially disrupting the availability of lower-margin products.

EOS Perspective

Only a limited number of global players operate in the AI chip manufacturing space, with NVIDIA holding the majority share. Startups and big tech companies are building strategies to carve out their market share.

NVIDIA will likely hold on to its market leadership with a slight dip in market share to core competitors, such as Intel and AMD, in the next few years. However, with its investments in AI R&R and its initiatives to diversify into different segments, NVIDIA might have a chance to recapture lost market share and grab new growth opportunities in the long term.

As the competition in the AI chip market intensifies, we can expect the launch of more affordable AI chips from NVIDIA competitors designed for customized AI applications. NVIDIA, on the other hand, would prioritize performance and reduce the cost of its AI chips. Since the competitors still lag in designing and developing advanced AI chips and often depend on third parties, NVIDIA is likely to capitalize and dominate the high-performance AI chip space.

With the massive and growing AI market, there is plenty of room for competitors and startups to grow even with a small market share. However, regulatory delays, sustainability issues, and unethical AI use can block strategic initiatives, increase the cost of compliance, and create uncertainty for investors and partners. Navigating these challenges will make NVIDIA more resilient and agile. The increased transparency and compliance can open up new partnership opportunities and new markets in regions where compliance is a major concern.

As AI will be the source of value for many businesses, NVIDIA will use its position to diversify by tapping into new markets to reduce its dependence on traditional markets. A potential partnership the company is discussing with OpenAI, a US-based AI research organization, will likely create a pool of new commercial opportunities for both companies to explore and monetize AI-driven solutions in the healthcare, finance, and automotive sectors.

 

Neuromarketing How Brands Are Leveraging Brain Science to Decode Your Desires by EOS Intelligence
by EOS Intelligence EOS Intelligence No Comments

Neuromarketing: How Brands Are Leveraging Brain Science to Decode Your Desires

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Innovative marketing strategies have become highly important for businesses in today’s crowded markets, where there is abundant competition and consumers have a vast array of options. This is why neuromarketing, a concept where brain science meets marketing, has started gaining popularity. Christened “astonishing hypothesis” by Nobel Laureate Francis Crick, it holds great promise for current and future marketers.

Neuromarketing is a marketing strategy that uses scientific methods to understand how consumers’ brains respond to products and advertisements. It measures brain activity and how people subconsciously react to ads, packaging, and products using methods such as electroencephalography (EEG), functional magnetic resonance imaging (fMRI), and eye tracking.

The goal is to uncover the underlying motivations, preferences, and decision-making processes that drive customer behavior. This approach can help marketers and businesses create more effective advertisements, develop products that meet customer needs and wants, and set appealing prices.

The concept of neuromarketing has been around since the 1990s and it gained popularity with the development techniques such as the Zaltman metaphor elicitation technique. This method allows researchers to tap into a person’s conscious and unconscious thoughts by analyzing their metaphoric or non-literal expressions.

Companies are using various approaches to adopt neuromarketing

Neuromarketing campaigns can use numerous approaches to attract customers.

EEGs and fMRIs are becoming increasingly popular

One approach is to use brain scanning techniques such as fMRI or EEG to monitor brain activity and understand how people process information.

An example is the 2011 neuromarketing study by the South Korean automotive manufacturer Hyundai. The company measured brain activity using EEG and identified the design features most likely stimulating a desire to buy. Based on the study, Hyundai also modified the exterior design of its cars.

Another one is the 2011 commercial Yahoo rolled out to attract more users to its search engine. Before launching the US$100 million rebranding campaign, the company tested the 60-second commercial featuring happy people dancing worldwide. The company had people wear EEG caps to monitor their brain activity while watching the ad to gauge its impact. The results showed that the ad stimulated activity in areas of the brain associated with memory and emotional response, suggesting it could effectively grab viewers’ attention.

Similarly, Microsoft partnered with California-based market research company EmSense in 2009 to study the brain activity of Xbox gamers to understand how engaged they are when exposed to 30- and 60-second TV ads versus in-game ads on the Xbox. The study, using EEG technology, showed that the highest level of brain activity occurred during the first half of TV ads promoting an automotive brand. Also, brain activity decreased when the same ad was repeated during Xbox Live in-game advertising. Microsoft incorporated this format to improve the ad’s memorability.

Businesses such as Frito-Lay, a US-based snack manufacturer, use EEG and focus groups to assess consumers’ genuine reactions to new advertisements. In a 2008 ad, they showed a woman pranking her friend by filling her laundry with orange Cheetos. Despite the focus group participants expressing a dislike for the ad, an EEG study revealed that they actually found it enjoyable.

The EEG-based neuromarketing trend will likely gain even more traction, especially with wearable EEG devices becoming increasingly common. In 2011, Tokyo-based multinational conglomerate Hitachi developed a portable, wearable brain scanner that neuromarketing can employ. Users can wear it while performing everyday activities, such as shopping, allowing marketers to study consumer behavior and preferences in real-life settings. This will also help them to develop marketing campaigns aligned with consumer preferences.

Neuromarketing How Brands Are Leveraging Brain Science to Decode Your Desires by EOS Intelligence

Neuromarketing How Brands Are Leveraging Brain Science to Decode Your Desires by EOS Intelligence

Marketers track eyes to identify customer preferences

Eye-tracking technology is another important technique used in neuromarketing. This technology records the movement of a person’s eyes as they view a screen, generating a heat map to show where they focused their attention. This method can be used to compare the effectiveness of different ads.

A 2009 study conducted by Objective Experience, a Singapore-based research firm, found that when people are shown a diaper ad with a baby looking directly at them, they pay less attention to the message. However, when the baby looks at the ad content, people engage more with the message.

Companies such as UK-based Unilever frequently use this method to test how their products perform in-store. In 2016, it partnered with Swedish technology company Tobii to record shoppers’ attention data while browsing products on the shelf using wearable eye trackers. The data was then analyzed to identify the features that drew shoppers’ attention, how they interacted with branding and marketing elements, and their impact on customer behavior. The insights from this study helped Unilever determine the design features that resonate most with shoppers, allowing the company to optimize brand awareness and perception.

Many other companies have also experimented with eye-tracking techniques. In 2017, the Japanese automotive manufacturer Toyota collaborated with Tobii to improve its in-store experience. The study revealed that younger shoppers spent more time on interactive digital elements, while older shoppers focused on textual information. However, it also showed that interactive digital screens generated the most engagement. This study became very beneficial for Toyota. Since consumers, such as automobile buyers, visit showrooms to make a specific purchase, eye-tracking technology can directly impact the sales of such companies.

While Unilever and Toyota collaborated with Tobii on neuromarketing strategies, UK-based pharmaceutical giant GlaxoSmithKline (GSK) has developed an in-house technique. In 2017, it launched a “Consumer Sensory Lab” to test its products using eye-tracking technology. The lab is designed to mimic a real store, allowing consumers to browse and shop while being monitored by eye-tracking devices. This allows GSK to analyze how consumers interact with products on the shelf and what packaging elements catch their attention. GSK’s investment in this technology shows that big players are now considering leveraging neuromarketing for market research and product development.

Packaging, colors, and emotions are essential in neuromarketing

Many companies are using effective packaging and experimenting with color psychology in neuromarketing. In 2009, Frito-Lay partnered with Ontario-based Juniper Park to understand why women were not choosing their products. The company identified that its shiny packaging was generating feelings of guilt in women while snacking. They redesigned their packaging using softer colors and avoided language that might trigger guilt.

Several companies use certain colors as neuromarketing tools to evoke specific emotions. US-based Coca-Cola’s use of the color red is an example. Similarly, brands such as Target and Netflix use red to convey feelings of power, excitement, and passion. Red has also been linked to increased hunger. Many fast-food chains, such as Wendy’s and KFC, use red to increase client engagement.

Many businesses also try to increase engagement by bringing out specific emotions. An example is German auto manufacturer Volkswagen’s 2011 Super Bowl ad, featuring a young boy dressed as Darth Vader trying to use “the force” on a VW Passat. Experts attributed the ad’s success to its combination of nostalgia (Star Wars), empathy (parental love), and humor (Darth Vader’s reaction).

Another example is Frito Lay’s 2018 “Operation Smile” campaign, which featured a series of smiles on the packaging of its potato chips. The campaign was designed to bring joy and happiness to customers and successfully connect with them.

Many brands are redesigning their packages and presentations using neuromarketing feedback, and the trend is expected to continue in the future.

AI integration and emotion AI are the emerging trends in the market

Integration with AI is one emerging trend that is greatly benefiting neuromarketing. As consumers engage in various online platforms, including social media, they leave a digital trail of personal information. This can be accessed by AI programs stored in the cloud.

AI analyzes this data and identifies patterns and customer preferences. This information can then be used to create effective marketing strategies. Netflix, for example, uses AI to power its recommendation engine and suggest shows based on users’ viewing history, completion rates, popularity rankings, etc.

AI also plays a crucial role in facial recognition and emotion detection. AI-driven facial tracking technologies are expected to help marketers understand how people respond emotionally to ad content more efficiently and accurately, helping them to design more engaging and impactful experiences.

Emotion AI, a type of artificial intelligence that analyzes, responds to, and simulates human emotions by detecting and interpreting emotional signals from various sources such as text, audio, and video, is another technological trend expected to benefit neuromarketing. Since this technology can capture and analyze human emotions and body language, marketers can use it to create user-centered and empathetic advertisements.

Sentiment analysis is an example, a tool used by Emotion AI that analyzes human emotions in text. This is often employed in marketing functions such as product review analysis.

An example is a 2018 campaign by the American sportswear giant Nike. The company used sentiment analysis to navigate the controversy surrounding NFL player Colin Kaepernick’s “take a knee” protest. As public opinion was divided, with both critics and supporters voicing their views, Nike partnered with California-based software development company Sentieo to monitor customer sentiments to protect its reputation. They tracked tweets and news related to the campaign before and after incorporating the “#justdoit” hashtag in Kaepernick’s tweets. The analysis also showed that consumer purchase intent improved due to the campaign, which benefited Nike.

Using tools such as Emotion AI is expected to directly affect companies’ profits since it helps them easily identify the customer’s opinion about the brand. It can also be used to detect early warning signs of customer dissatisfaction or frustration. This is expected to enable businesses to address issues promptly and reduce the risk of negative word-of-mouth or online reviews.

There are challenges and concerns about adoption

Though neuromarketing is expected to shape the future of marketing, interested players must address some concerns before taking the plunge. Critics have raised ethical concerns about its morality and the potential for privacy violations. There is also a potential for bias and inaccuracies in the research methods, leading to unreliable conclusions and flawed marketing strategies.

Larger companies with greater budgets are more likely to use neuromarketing leaving smaller players, who cannot afford the cost, at a significant disadvantage. This will widen the gap between these companies, as smaller ones will struggle to compete with larger companies’ marketing and advertising capabilities. Also, consumers may unknowingly choose products influenced by neuromarketing tactics, making it even harder for smaller companies to compete.

Moreover, larger corporations will have the means to invest in research and development of own neuromarketing techniques, further solidifying their advantage. These companies are also likely to keep the research findings proprietary, thereby limiting opportunities for smaller companies to compete.

More research is also needed to bring neuromarketing to the mainstream, especially in areas where real-time responses and feedback are required, such as in-store shopping. Since EEG technology, widely used in neuromarketing, can be compromised by interference from other electrical devices and requires subjects to remain still, it can become difficult to replicate lab-based research conditions in a real-world setting.

EOS Perspective

The marketing landscape has significantly transformed in the past few years. Consumers are now more tech-savvy and take to social media platforms when faced with an unpleasant event. Companies are also aware that negative reviews on online platforms can significantly impact a brand’s reputation within a short time. This can be increasingly managed by employing neuromarketing. Though it is still considered to be in its embryonic stage, experts believe this innovative marketing technique will reshape advertising and consumer-business relationships.

As the number of global mobile users is expected to cross 7.5 billion in 2025, according to a 2021 report by the US-based market research firm, The Radicati Group, neuromarketers are expected to collect real-time data by leveraging mobile devices. This will enable players to capture a more authentic and nuanced understanding of consumer behavior in real-world settings rather than relying solely on laboratory-based or controlled environments.

This real-time data collected using mobile devices can be used to design marketing strategies, product development, and customer experiences that are more tailored to meet consumers’ evolving needs and preferences.

Experts also believe that technological advancements such as brain-computer interfaces (BCIs) can revolutionize the marketing landscape in the near future. BCIs enable seamless communication between the human brain and machines, giving marketers access to consumers’ real-time thoughts and emotions. This is expected to pave the way for ultra-personalization, as companies can tailor their products and advertisements to individuals’ unique preferences and emotional responses.

While there are ethical concerns surrounding its use, the fact that neuromarketing is still in its early stages of development means it has the potential to evolve in tandem with addressing the ethical doubts. As technology becomes more accessible, the key challenge will be ensuring that neuromarketing is used responsibly and ethically.

Denmark – A Trailblazer in Digital Health Innovation by EOS Intelligence
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Denmark – A Trailblazer in Digital Health Innovation

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The COVID-19 pandemic has spurred the need to embrace new digital tools and technologies within the healthcare sector. There has been a significant increase in the use of technology to provide care, resulting in improved health outcomes. In Europe, Denmark has made significant progress and is at the forefront of the digital health transformation with a 99% digitalization rate. Over the last few years, Denmark has strived to digitalize further its healthcare infrastructure, testing and leveraging technologies such as AI and robotics to implement them at full scale across the country. In this transformation, the Danish digital health system can be a source of valuable lessons, uncovering various opportunities it presents for health tech companies.

Demark’s digital health: Harnessing power from a robust public infrastructure

Denmark’s healthcare system is among the most expensive worldwide, with 10% of GDP allotted for healthcare expenditures and 90% publicly funded through taxes. The health infrastructure is highly digitalized, with almost 99% of healthcare communication done electronically.

The national e-health portal, Sundhed.dk, launched in 2003, plays a key role in Denmark’s digitalization, offering a comprehensive platform catering to both healthcare professionals and citizens alike. Sundhed.dk provides safe and secure access to an individual’s personal health records (from hospitals), medication information, vaccinations, laboratory results, appointments, and referrals. The portal is user-friendly and is regarded as one of the superior models for public healthcare information exchange worldwide.

Over the last 20 years, the Danish government has supported and invested in various digital health initiatives, rolled out several IT services, and strengthened its digital healthcare infrastructure. In 2007, the country introduced E-record, through which individuals can access their medical information from EHR systems using the Sundhed.dk portal. The government also launched Shared Medication Record, which has records of patients’ prescriptions, details of the doctor who prescribed the medicines, and information pertaining to where the medications were picked from. During the COVID-19 pandemic, the “My Doctor” app was introduced to facilitate video consultations between GPs and patients. These digital initiatives contribute to improved care coordination and increase the patient’s trust in the system.

Denmark – A Trailblazer in Digital Health Innovation by EOS Intelligence

Denmark – A Trailblazer in Digital Health Innovation by EOS Intelligence

Unraveling the blueprint: Denmark’s digital health success story

Well-formulated digital health strategies address the needs of patients and healthcare workers

Many countries develop digital health strategies, which are frequently focused solely on technical aspects, steering away from addressing the actual needs of patients and healthcare professionals. Moreover, these policies often function as plain vision documents with no clear description of action plans or the roles and responsibilities of various stakeholders.

In contrast, Denmark’s digital health strategy is well-formulated and primarily focused on addressing the needs of patients and healthcare workers. It provides a clear vision of how digital technology can help meet their needs. In addition, the strategies highlight the importance of cross-sectoral collaboration, detailing focus areas and specific initiatives that must be jointly executed. For instance, it clearly mentions how the health and education sectors should work together to promote digital health literacy.

Denmark’s well-crafted digital health policies are a cornerstone of its successful digital health transformation. Since 1999, the country has been updating these strategies every four years, ensuring ongoing review and modernization of its digital health infrastructure.

Governance models aid in the speedy integration and implementation of digital healthcare tools

Denmark follows a regional governance model instead of the top-down approach, controlled by the state (national) government. The states and municipalities are responsible for developing and implementing their own health IT solutions in alignment with the national strategy.

Further, the government has established several steering groups to aid in implementing and disseminating digital health initiatives for rapid digital uptake. For instance, Connected Digital Health in Denmark, a cross-governmental organization, manages, coordinates, and ensures the implementation of various action plans mentioned in the national digital health strategies.

In addition, the government also regularly engages in public-private partnerships to boost its digital capabilities. The country’s strong governance is considered one of the critical success factors for the digital health transition.

Common IT standards help in effective healthcare data exchange

Many countries have deployed digital health technologies; however, integration remains sparse, resulting in a fragmented digital landscape. Integrating patient information siloed across multiple healthcare segments is crucial for establishing a high-quality digital health infrastructure. The adoption of common IT standards helps facilitate this data exchange and integration.

Denmark has been using these standards since 1990 for electronic health data communication as well as improving workflows between public hospitals, general practitioners, private healthcare entities, specialists, laboratories, and home care services. The early development of these standards significantly increased electronic communication within the healthcare sector, contributing to the high level of digitalization of the Danish healthcare sector.

Strict testing protocols ensure digital health tools are user-friendly

The user-friendliness of digital technologies is considered one of the major factors for early e-health adoption. Denmark undertakes several initiatives to ensure that digital health tools and technologies are user-friendly and easy to use. For instance, the country collects feedback from healthcare stakeholders about their experience with various digital health solutions, checks if they are user-friendly, and uses the input received to develop new solutions.

The country has also implemented strict testing protocols for telehealth solutions by evaluating their performance on mobile devices and testing the products with a range of end users, including the elderly and people with disabilities.

Government’s focus on educating and training healthcare stakeholders helps them to use digital tools effectively

Denmark educates and trains healthcare workers to use digital tools appropriately. According to a 2020 Deloitte report, nearly 76.8 % of Danish clinicians mentioned that they are well-trained and supported in using digital health tools and solutions.

Local governments and hospitals in Denmark collaborate with tech professionals to provide support, education, and training on using digital solutions such as EMRs, telemedicine platforms, and shared IT standards for healthcare data exchange. Digital health literacy of front-line healthcare workers is one of the core objectives of the country’s digital health strategy.

Unlocking opportunities: Denmark’s digital health sector for health tech companies

According to Statistics Denmark, the percentage of the Danish population aged 75 or above is expected to double from 7.8% in 2017 to 14.4% in 2047. In addition, the country faces a severe labor shortage, with projections suggesting that by 2035, Denmark might have a shortage of 14,500 healthcare workers. These factors are expected to put increased pressure on the Danish healthcare system.

In order to tackle these challenges, Denmark’s government continues to invest in advanced innovative technologies and digitalization strategies. In 2018, the country launched a digital health strategy titled “A Coherent and Trustworthy Health Network for All: 2018-2024”, aiming to modernize the healthcare infrastructure further. Under this initiative, the country aims to expand telemedicine solutions, increase virtual care visits, and automate the administrative and clinical workflows within the Danish healthcare system. This initiative is creating opportunities for startups and companies offering health tech solutions in the areas of telemedicine, video consultations, remote patient monitoring, hospital automation, and diagnostics.

Danish government seeks to expand telemedicine solutions for various segments of the patient population

Denmark has been using telemedicine services since 2012, beginning with home monitoring solutions for Chronic Obstructive Pulmonary Disease (COPD) patients. The country seeks to further expand the rollout of telemedicine solutions for patients with COPD, chronic diseases, heart failure, comorbid conditions, and pregnant women facing complications. In December 2023, the government of Denmark invested about US$72 million to expand telemedicine solutions for these patients, offer digital rehabilitation courses, and increase the number of virtual consultations through GPs.

Various governmental organizations in Denmark have been looking to partner with companies providing innovative remote monitoring and virtual care solutions to facilitate home treatment.

For instance, in 2021, in collaboration with the local government, Trifork, a Denmark-based digital health company, developed a telemedicine solution called Telma for severe COPD patients. The solution provides COPD patients with medication, measuring tools, and devices to track pulse and oxygen levels at home. The Telma app transmits this data in real time and facilitates communication between healthcare professionals and patients through video consultations, thus lessening the need for frequent hospital visits.

Similarly, in 2022, two Denmark-based health tech companies, Copenhagen Center for Health Technology (CACHET) and Cortrium, forged a research collaboration to develop a novel technology to monitor a patient’s heart rhythm remotely. This allows heart failure patients to receive prompt medical care without visiting a hospital.

The Danish government is also looking to provide telerehabilitation services amidst the rising mental health issues across the country. In 2021, the government established the Centre for Digital Psychiatry to develop, test, and implement several nationwide digital services. In March 2023, the Center initiated a research project with Monsenso, a Danish mobile health company, to provide personalized digital treatment for patients with depression.

A rise in telemedicine programs catering to various segments of the patient population is expected in the forthcoming years. This surge in demand fuels the growth of companies offering telehealth solutions nationwide.

AI presents several opportunities for innovation and collaboration within the healthcare segment

Denmark actively seeks to integrate AI into its healthcare system, especially in diagnostics, presenting numerous opportunities for AI-based health companies to thrive. The country has established research and innovation centers across the country focusing on AI for uses such as identifying at-risk stroke patients, helping radiologists interpret scans, and assisting in other diagnostics.

In 2021, Denmark established the Radiology AI Test Center (RAIT) to accelerate the development and implementation of medical AI applications in the country. Through RAIT, private companies can test and validate their AI-based technologies in Denmark. For example, in 2021, through the RAIT program, several Danish hospitals in Copenhagen partnered with US-based imaging AI startup Enlitic to evaluate an AI-based algorithm to read chest X-rays. Similarly, in 2023, RAIT partnered with Cerebriu, a Denmark-based health tech company, to use AI to improve MRI imaging of the brain.

Investments in advanced digital technologies modernize healthcare infrastructure

As Denmark endeavors to digitalize its hospitals, ample opportunities arise for companies specializing in robotics and mobile health to improve hospital and clinical workflows, among other areas.

Some steps have been taken to digitalize hospitals. For instance, the Centre for Clinical Robotics (CCR), a research and innovation center for healthcare robotic technology in Denmark, aims to leverage robotic technology for various hospital processes, such as food service, cleaning, medication dispensing, clinical sample collection, etc.

Another interesting instance is the pilot project between Systematic, a Denmark-based software company, and physicians at the Aalborg University Hospital. Systematic has developed a communication platform called Columna Flow Clinical Tasking, which facilitates direct communication among the physicians at the Aalborg Hospital. The solution offers a real-time overview of the patients, including their medical conditions and the workload of hospital clinicians on duty. This empowers physicians to prioritize patients and efficiently allocate tasks during peak hospital hours.

EOS Perspective

The Danish health system is poised for an even more profound digital transformation in the coming years, aiming to improve patient accessibility and convenience. Denmark’s healthcare market is already highly digitalized, which provides a robust foundation for further digital transformation and innovation.

Home care and telemedicine, health data interoperability, AI-based diagnosis, healthcare automation, personalized medicine, and preventative health are likely the key focus areas for the next phase of digital health transformation.

Further, the country is looking to elevate patient care through its super hospital program, which involves consolidating smaller hospitals into larger, higher-capacity units. The aim is to provide superior medical care at lower costs. Technology will play a key role in improving healthcare delivery and patient outcomes in these hospitals, with applications across logistics, clinical decision support tools, diagnostic tools management, and patient engagement, among other areas.

These initiatives can be expected to make the Danish health system even more robust. The system is expected to move from a doctor-centric to a patient-centric care model, where patients would be actively involved in taking care of their own health. The country’s meticulously crafted digital health strategies, well-established digital infrastructure, and technology-proficient population lay a solid foundation to usher in the next wave of innovation.

As Denmark persists in its commitment to build a healthcare system fit for the future, there are abundant opportunities for health tech companies to thrive and drive innovation within the Danish healthcare industry.

FemTech A Game-Changer in Womens Healthcare by EOS Intelligence
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FemTech: A Game-Changer in Women’s Healthcare

Women’s healthcare is one of the most neglected and understudied fields in the healthcare sector. Despite substantial advances in medical sciences in recent years, there still exists a huge gap in the treatment of diseases that are specific to women. FemTech focuses on addressing some of these gaps and offers the potential to help tackle the longstanding issues of women’s health.

FemTech developed as an answer to inadequate healthcare for women

According to a 2018 article published in Our World in Data, a UK-based online scientific publication, human life expectancy has increased tremendously from 30 to 73 years during the last two centuries (1800–2018). But this leap has not been reflected in women’s life quality. A 2024 report published by the World Economic Forum and the McKinsey Health Institute indicated that women live 25% longer in poor health than men, although they typically outlive males.

FemTech, a group of technology-enabled solutions such as diagnostic tools, wearables, products, software, and services, aims to tackle women’s health issues, such as maternal, reproductive, menstrual, and sexual health, as well as menopause. An example is the UK-based Flo Health app that tracks ovulation and the menstrual cycle, offers customized health insights and tips, and a closed community for sharing concerns and queries. US-based Natural Cycles is another example. This application provides personalized insights based on each user’s menstrual cycle patterns. This novel approach to improving women’s health and well-being has been gaining more importance in recent years.

Several challenges slow down progress and widespread acceptance

While FemTech offers promising solutions to help diagnose and manage many health issues affecting women that were previously overlooked, several challenges are awaiting interested players.

One major bottleneck players face is the scarcity of investments. Many investors still consider FemTech a niche sector and shy away from investing compared to other healthcare fields. This situation is slightly improving, as the industry has seen an increase in investment in recent years. Data from Dealroom, an Amsterdam-based provider of data and insights on start-ups and tech ecosystems, indicated that the venture capital (VC) funding into FemTech startups reached US$2.1 billion in 2021, an all-time high.

Despite this increase in investment in FemTech, the total funding for this sector still trails other sectors, especially if it is female-led. The CEO of a leading US-based fertility tracker Mira, said in an interview with Forbes that though 70% of FemTech startups are female-founded, male-owned businesses tend to raise more capital.

Investors and lenders often have unconscious biases against female entrepreneurs, affecting their willingness to invest in female-led businesses, according to a 2020 study published in the Journal of Financial Economics, a peer-reviewed financial journal. Also, women might only have restricted access to male-dominated fundraising sources, including crowdfunding websites, angel investors, and VC firms. Similarly, the traditional male dominance in some areas, such as technology and finance, can also lead to power imbalances in fundraising and limit the options available to women.

Insufficient R&D support is another major challenge faced by players in the FemTech sector. This can be seen from the fact that a significant proportion of the funding allocated to healthcare R&D is not focused on issues that directly impact women’s health and well-being, with a meager 4% dedicated to this area according to a 2018 article published in Forbes. This insufficient funding can cause innovation stagnation, set back product development, and reduce market opportunities.

The inadequate representation of women in clinical trials is another difficulty faced by FemTech companies. This lack of representation has created a knowledge gap in understanding important facets of women’s health, such as female anatomy, physiology, health issues, etc. A 2022 study published in Contemporary Clinical Trials, a peer-reviewed journal, showed that though women constitute 50.8% of the US population, just 41.2% of those involved in clinical trials were female. This creates a certain lack of awareness of how women’s bodies work, making it challenging for FemTech businesses to develop effective solutions.

Cybersecurity issues are also creating challenges in the development of FemTech. A joint study by Newcastle University, Royal Holloway, University of London, and ETH Zurich found serious privacy, security, and safety concerns that could put users at risk. The research indicated the danger of leaking sensitive information, such as fertility, medical data, etc., to third parties.

Cultural and social taboos are another bottleneck faced by FemTech companies. Female-specific issues such as postpartum depression and premenstrual syndrome are rarely openly discussed. This makes bringing societal focus to FemTech products a difficult task.

FemTech A Game-Changer in Women's Healthcare by EOS Intelligence

FemTech A Game-Changer in Women’s Healthcare by EOS Intelligence

FemTech industry is seeing significant development in some segments

Though confronting numerous challenges, FemTech remains a promising industry for interested players with its projected market growth. The FemTech market, estimated at US$40.2 billion in 2020, is expected to reach US$75.1 billion in 2025, according to a 2021 report by the US-based market research agency Arizton Advisory & Intelligence.

General health and wellness is the fastest-growing segment

FemTech offers several solutions for improving women’s health across various segments, with general health and wellness companies attracting the most VC investment, followed by reproductive health and contraception.

The general health and wellness segment combines digital health clinics, mental health services, and direct-to-consumer products. Since companies in this segment focus on broad-ranging solutions that address multiple issues, demand for them is expected to rise.

An example is Maven, a New York-based company offering a holistic solution encompassing pre- and post-pregnancy care. This virtual clinic provides 24/7 access to healthcare professionals, including mental health therapists, relationship consultants, and sleep coaches. In 2022, Maven attracted US$300 million in funding from prominent investors and individual strategic partners.

Another example is Stockholm-based Grace Health, acquired by Penda Health, a Kenyan medical care chain in 2023. It uses an automated health assistant called Grace to monitor and understand women’s sexual and reproductive well-being and receive timely reminders and notifications. The company is also expanding its local footprint in key African markets, including Nigeria, Kenya, and Ghana, to solidify its position as a market leader in these regions.

Reproductive health segment is also seeing strong demand

The reproductive health segment and menstruation care are also expected to continue holding the interest of investors and customers alike. According to the NIH, in the USA, 20% of women are now having their first child after turning 35, owing to a greater emphasis on education and career. With increasing age, some women may experience difficulty before, during, or after pregnancy. Women will also need to effectively and accurately track their fertility to make informed reproductive choices. This is likely to greatly contribute to in increased demand for FemTech reproductive health solutions.

An example is the Clue App, a Germany-based fertility tracker that leverages user data to compute and predict individuals’ periods and PMS. In 2023, the company raised US$7.6 million in funding and partnered with global universities such as the University of Exeter to bridge the diagnosis gap for women’s health conditions. This collaboration is expected to create new trends in managing female health issues.

Oncology products are now aimed at individuals and medical professionals

Development is also underway in the oncology segment. An example is Nevada-based Cyrcadia Health developing a breast monitor that tracks changes in breast tissue temperature over time to aid in the detection and risk management of breast cancer. The monitor consists of two patches that track temperature changes and send the data anonymously to the Cyrcadia Health core lab. This data is analyzed using machine learning (ML) algorithms and predictive analytics software to identify and categorize abnormal circadian patterns in healthy breast tissue. The results are then delivered to healthcare providers. This solution, when it becomes available in the market, is expected to enable women to take more proactive control of their breast health.

Cancer continues to be a leading cause of women’s death both in middle-income and high-income countries, according to a 2017 article published in Cancer Epidemiology, Biomarkers & Prevention, a peer-reviewed journal. Therefore, the focus on FemTech oriented at breast cancer and cancer in general is expected to gain momentum in the future.

Stigmatized conditions and marginalized subpopulations are increasingly addressed

Many FemTech companies are now exploring areas beyond menstrual and reproductive care and addressing stigmatized and unmet conditions such as preterm birth, endometriosis, pelvic care, and sexual health.

An example is London-based Elvie, a company that addresses pelvic floor dysfunction, a common and often overlooked health issue affecting many women. According to the NIH, 27% of women aged 40-59 and 37% of women aged 60-79 experience some form of pelvic floor dysfunction. Elvie has developed a Kegel trainer that uses biofeedback technology to improve pelvic and sexual health through five-minute workouts. The development of these solutions is expected to persuade more women to seek treatment and improve the diagnosis of these health conditions.

Similarly, apps are also being introduced for different sections of the population such as LGBTQ+, black women, and women from low and middle-income societies. US-based InovCares, an app designed to address the crisis of maternal mortality affecting Black women, is an example. This virtual OB-GYN platform connects users with culturally sensitive healthcare professionals who cater to various health needs, including fertility, childbirth, and breastfeeding.

Solutions are being developed in various geographies

While FemTech solutions development is concentrated in the USA and Europe, it is also visible in developing geographies such as Africa and Southeast Asia. An example is Indonesia’s BukuBumil which provides information on various aspects of pregnancy, including fertility, maternal health, baby immunizations, family planning, and post-pregnancy care in the Indonesian language. The platform also allows users to track a baby’s development and milestones.

Another one is Ethiopia-based YeneHealth, a multilingual and culturally responsive platform with AI-powered trackers for menstrual cycle, pregnancy, and medication management.

AI and ML are expected to shape the future of FemTech

Technological advancements are creating waves in the FemTech industry. Many companies are developing smart wearables and AI-powered solutions. Zurich-based Ava Women has developed a wearable, the Ava bracelet (available without prescription), to track hormonal changes. It allows users to monitor their ovulation and detect potential health issues. Ava’s technology uses big data and AI to provide accurate and personalized insights.

Similarly, Ovum, an Australia-based health management app, currently in its pilot phase, offers an AI health assistant designed for women to generate a dataset to improve treatments and diagnostics of various conditions. The app integrates and stores medical records, allowing users to track their health and receive personalized recommendations. This comprehensive data repository is crucial for complex or chronic conditions such as endometriosis, where a diagnosis can take years.

Experts believe the widespread use of AI and ML in FemTech apps will help players provide more accurate and data-driven solutions to users. AI can also analyze large datasets and use predictive analytics to anticipate health risks, such as gestational diabetes or pre-eclampsia.

EOS Perspective

The FemTech landscape, though still developing, is expected to expand more and grow quickly, especially with the increasing discussion around female health, Amazon CTO Werner Vogels commented at the 2023 AWS re:Invent conference, the largest conference in the cloud computing community. He has highlighted the significant potential of FemTech to transform the female healthcare system, specifically considering that women make up 50% of the population and account for 80% of consumer healthcare decisions.

FemTech has also the potential to significantly impact the healthcare sector and the global economy as a whole in the coming years. A 2024 report by the McKinsey Health Institute indicated that improving women’s health could boost the world economy by at least US$1 trillion annually.

The market is expected to see FemTech players widen their business scope, offer multiple services, and address a broader set of health issues. An example of this trend is UK-based Peppy, which initially helped organizations better support their women staff members after they had a baby, but now also deals with menopausal issues. This shift demonstrates a broader approach to women’s health under a single solution and reflects a development towards more comprehensive and inclusive offerings within FemTech.

Since FemTech is still developing, extensive R&D can be expected in the coming years. Experts believe health issues affecting older women also offer interested parties a research investment opportunity. Even now, in discussions and debates regarding FemTech, the diseases suffered by older women get overlooked. This makes it a promising area for future developments.

As the FemTech market expands, it is likely to attract collaborations from players operating outside the healthcare sector. One of the first examples of this was seen in August 2021, when the French cosmetic giant L’Oréal partnered with Clue to research the connection between the menstrual cycle and skin health to improve its skincare products. Such collaborations, whether just publicity stunts for cosmetic companies or not, can help put FemTech solutions on the map of legitimate tools close to women’s health. Considering that FemTech is still considered a niche sector, this can draw attention to the relevance of this market and its players and, consequently, stimulate investment.

Over the long term, women-led companies are expected to create more effective FemTech solutions that identify and cater to women’s unique healthcare requirements. The key factor behind it is that women are better placed to understand the health issues affecting women. A 2022 study published in Harvard Business School’s digital research publication Working Knowledge has also indicated that female-led research teams are more likely to study conditions that impact both genders than male-led ones. With more women stepping into STEM (science, technology, engineering, and mathematics) roles and female-led FemTech start-ups emerging, there is a promise of a more comprehensive scope of FemTech solutions.

A 2023 article published in Harvard Business Review noted an important trend that may positively affect the FemTech market: female investors are more likely to invest in and support female entrepreneurs. This suggests the potential for more capital flowing into women-led businesses, including in FemTech. As more women take on senior leadership roles in both FemTech startups and VC firms, this could substantially propel the industry growth.

Digital Therapeutics The Future of Healthcare by EOS Intelligence
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Digital Therapeutics: The Future of Healthcare?

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Although the COVID-19 pandemic seems to be done with its rampage, many people still opt to access all kinds of services, including healthcare, from the comfort of their homes. As this trend is expected to continue, the global digital therapeutics market, with its projected growth at a 20% CAGR from 2022 to 2035, is one important sector healthcare firms should focus on right now.

Digital therapeutics (DTx) are digital health interventions or software applications that are clinically validated and designed to treat or manage medical conditions. They can be used alone or in conjunction with traditional medical treatments.

The Digital Therapeutics Alliance categorizes DTx products into three types: disease treatment, disease management, and health improvement.

Examples of DTx include a solution to manage chronic musculoskeletal pain developed by Kaia Health, a biotechnology company in New York. This motion analysis tool assesses and guides patients’ progress during physical therapy and tailors treatment to individual requirements.

Similarly, Clickotine from Click Therapeutics, a company also based in New York, uses AI to help people with nicotine addiction. This solution offers a personalized plan fully integrated with eight weeks of nicotine replacement therapy, including options such as gum, patches, or lozenges. It tracks critical aspects such as daily cigarette counts, craving triggers, craving times, etc. A trial study conducted by the company in 2016 claimed that 45% of Clickotine users were able to quit smoking.

Adoption of DTx is taking off amid increased investments

The commercial development of DTx started around 2015 and, since then, has grown into a global market of considerable size. The total value of global DTx start-ups was estimated at a whopping US$31 billion in 2022, according to a 2022 report published by Dealroom, an Amsterdam-based firm offering data and insights about start-ups and tech ecosystems, in partnership with MTIP (a Swiss-based private equity firm), Inkef (an Amsterdam-based early-stage venture investment firm), and Speedinvest (an Austrian early-stage investor).

The number of people using DTx solutions is expected to increase over the next few years, according to a 2022 report by Juniper Research, a UK-based research firm. The study found that there were 7 million DTx users in the USA in 2020, a number expected to rise to around 40 million in 2026.

This increase can be attributed to the fact that DTx solutions are highly accessible and distributable due to an increase in the use of smartphones. A 2021 report published by Pew Research Center, a US-based think tank, found that 87% of Americans owned a smartphone in 2021, compared to 35% in 2011. With this, more people will be able to access medical care without having to spend more on hospital visits.

DTx applications have also been attracting numerous investors owing to the applications’ cost-effectiveness, ease of distribution, and better accessibility. According to the same 2022 report published by Dealroom, global venture capital funding in DTx witnessed a fourfold increase in 2022 compared to 2017.

All these studies reveal that, despite certain challenges, the DTx applications hold the promise of developing into a practical and affordable means of treating illnesses and conditions that impact large numbers of people.

Regulatory pitfalls present a major roadblock to DTx adoption

One main challenge DTx companies face is the regulatory environment. All DTx products must comply with the regulations of regional agencies such as the FDA, HIPAA, HITECH, etc.

Many US firms initially faced regulatory obstacles and payer resistance around product reimbursement. Before 2017, the US FDA classified DTx solutions as a SaMD (Software as a Medical Device) and, therefore, made them subject to risk assessment (low, medium, or high). Due to this, DTx solutions needed premarket approval and rigorous clinical trial results to get approval.

This has improved with the introduction of the Digital Health Innovation Action Plan by the FDA in 2017. According to the new plan, the FDA will first consider the company producing the solution. If the producer has demonstrated quality and excellence, it can market lower-risk devices with a streamlined premarket review. Post-market surveillance and data collection are also done to evaluate product efficiency.

Similarly, in the EU, DTx is controlled by national competent authorities and governed by the European Regulation on Medical Devices 2017/745 (MDR). However, no specific framework indicates the evidence required for assessing the performance or quality of DTx solutions or their production standards. This means that the member states may interpret the dossier requirements differently, leading to a fractured regulatory environment.

The COVID-19 pandemic has provided companies with some regulatory flexibility, leading to an increase in venture capital funding. In 2020, the federal government in the USA issued a new rule allowing healthcare practitioners to treat patients across state lines, including the use of digital medicine. This can increase access to healthcare, especially in rural areas, and physicians will be able to offer timely care to their patients traveling in a different state.

The FDA has also loosened regulations during COVID-19, particularly for mental health products, with the Digital Health Innovation Action Plan. This was to ensure that patients received timely care even from their homes while reducing the burden on hospitals. It waived certain regulatory obligations, such as the need to file a 510(k) premarket notification during the COVID-19 pandemic. The 510(k) is a submission indicating that a new medical device is similar to something already approved by the FDA (a predicate device) to ensure safety and efficiency. However, finding suitable comparables can be highly challenging in the case of DTx, which is dynamically evolving. This can result in misunderstandings or overlooking of critical aspects of these solutions, leading to uncertainty and delays in the approval process. The waiver of this regulation offers DTx companies some relief in the future.

Digital Therapeutics - The Future of Healthcare by EOS Intelligence

Digital Therapeutics – The Future of Healthcare by EOS Intelligence

Patient health literacy is a hurdle in the adoption of DTx solutions

A survey by the National Assessment of Adult Literacy (NAAL) in 2003 has shown that only 12% of Americans possess proficient health literacy skills, making them able to find and understand information related to their health. This lack of awareness among patients can also impede the ease of applying DTx products.

Patient experience is also crucial for the acceleration of DTx adoption. Older patients unfamiliar with using technological gadgets can find it difficult to adopt DTx solutions. However, a 2022 AMA survey has shown that 90% of people over the age of 50 in the USA recognize some benefit from digital health tools.

Similarly, a survey conducted by the Pew Research Center in 2021 indicated an increase in the use of smartphones and the internet among older people in the USA, driven by the pandemic. Older adults are using technological applications for activities such as entertainment, banking, shopping, etc., even after the pandemic, a 2021 survey by AARP Research, a US-based NPO, shows. This indicates that there is scope for an increase in adoption.

Many companies are now trying to increase patient involvement by using gamification, aiming at patient groups for whom DTx use is likely to be more challenging (e.g., older population, children). DTx developers include game-like elements or mechanics into a DTx solution, such as tasks, rewards, badges, points, and leaderboards. An example is US-based Akili Interactive’s EndeavorRx, a prescription DTx aimed at enhancing attention function in children with ADHD aged 8 to 12. It uses an interactive mobile video game to assist children in improving their attention skills and adjusting to their performance levels. The game’s sensory stimuli and motor challenges also help kids multitask and tune out distractions.

Payer reluctance affects many DTx products

Although the number of DTX products on the market increases, payers’ reluctance to cover their costs to the patient can also slow down adoption. The coverage of DTx solutions is limited, even when they are FDA-approved. Only 25% of payers are currently willing to cover prescription DTx solutions, according to a 2022 survey by MMIT, a Pennsylvania-based market data provider, which involved 16 payers.

Akili Interactive’s EndeavorRx is one such solution facing insurance coverage issues. Elevance Health (previously Anthem) denied coverage for EndeavorRx, deeming it medically unnecessary, while Aetna, another insurance provider, considers it experimental and investigational.

A study released by Health Affairs, a health policy research journal, in November 2023 has shown that only two of the twenty FDA-approved prescription DTx solutions on the market have undergone rigorous evidence-based evaluation. This means that no authoritative results indicating the benefits of these solutions for various population demographics are available, making many payers skeptical of their medical claims.

DTx offers solutions for managing multiple conditions

Over the past few years, several prominent players have emerged in the DTx landscape. Around 59% of the DTx market is concentrated in the North American region and 28% in Europe.

Top players, such as Akili Interactive and Big Health, both US-based firms, focus on offering products for managing mental health illnesses, mostly management of anxiety, depression, and stress, according to a report published in 2023 (based on data until September 2022) by Roots Analysis, an India-based pharma/biotech market research firm. With about 970 million people suffering from mental health conditions globally (according to the WHO), the potential user pool is enormous, offering growth opportunities for DTx solutions developed to address mental illnesses and, over time, driving the growth of the DTx market as a whole.

Many top companies also focus on solutions offering pain management and treatment for chronic conditions such as diabetes, obstructive pulmonary disease, and musculoskeletal disorders. An example is US-based Omada’s pain management solution, Omada MSK. This application guides patients through various customized exercises and records their movements, which are then assessed by a licensed physical therapist (PT), who can make recommendations for improvement. It also has a tool that utilizes computer vision technology to help PTs virtually assess a patient’s movement and range of motion, allowing them to make necessary changes in the therapy.

Similarly, several DTx solutions on the market now focus specifically on diabetes, which affects around 537 million adults globally. Some top companies focus on the previously unmet needs of conventional methods, such as weight management or preventing prediabetes, to help with overall diabetes treatment. US-based Omada’s solution, Omada Prediabetes, comes with a weight scale pre-connected to the app, and the weight is added to the app as soon as the patient steps on the scale. A dedicated health coach assesses the patient’s weight, creates a customized plan, and monitors the patient’s progress. In other similar DTx solutions for diabetes, an app can also give insulin dose recommendations based on the patient’s blood glucose levels.

DTx can serve in a range of other conditions, including major depressive disorder, autism spectrum disorder, and multiple sclerosis, to name a few.

The DTx landscape is rife with development

The DTx business landscape has recently seen many developments, from acquisitions to product launches. One of them was Big Health’s acquisition of Limbix, a California-based DTx firm, in July 2023 to bolster its portfolio, including SparkRx, a treatment for adolescents dealing with depression and anxiety. Similarly, in June 2023, Kaia Health launched Angela, a HIPAA-compliant, AI-powered voice-based digital care assistant, to serve as a companion and guide, enhancing the physical therapy experience for patients.

In another development, BehaVR, a DTx company headquartered in Kentucky, and Fern Health, a digital chronic pain management program, merged their companies in November 2023 to create a novel pain management DTx solution that addresses both pain and fear caused by chronic diseases. With this merger, they launched RealizedCare, an app designed to offer a comprehensive solution that collaborates with health plans, employers, and value-based providers to treat a range of behavioral and mental health conditions. This solution provides clinicians with immersive programs specifically designed for in-clinic use. It is initially focusing on chronic pain.

Bankruptcy of Pear and lessons for the industry

However, the most shocking development in the DTx market was the bankruptcy of Pear Therapeutics in 2023. The remains of this once-prominent company were purchased by four other companies for a total of US$6.05 million at an auction. Pear was a big name in the industry since its inception in 2013. It introduced numerous products such as reSET, reSET-O, and Somryst for treating substance use disorder, opioid use disorder, and chronic insomnia, respectively. It was also the first company to receive FDA approval for a mobile app aimed at treating substance use disorders.

Though the company announced layoffs of nearly 20% of its workforce in November 2022, its management expressed optimism about the company’s growth and reduced operating expenses in the third quarter. But in April 2023, the company filed for bankruptcy.

The demise of Pear has opened the eyes of industry experts to the challenges faced by DTx players. Certain issues were unique to Pear itself, such as the comparatively higher prices of its products and the focus on treating challenging conditions such as substance use disorders. However, the bankruptcy of Pear also brings attention to the obstacles that can be faced by any other DTx company. One crucial roadblock is that physicians and payers still approach these products with caution. Additionally, achieving profitability for DTx might be challenging for all types of players, particularly for small start-ups lacking substantial market influence. The bankruptcy of Pear and the challenges it faced can be used by budding DTx companies as a road map as they navigate this complex sector.

EOS Perspective

DTx is all set to revolutionize the medical industry, with a 2020 McKinsey report suggesting it could potentially alleviate the global disease burden by up to 10% by 2040. Given the impact of emerging treatments on stakeholders, pharmaceutical and healthcare companies should consider expanding their portfolio to include DTx solutions.

With telehealth companies seeing good growth in the pandemic and post-pandemic years, an increase in investment can be expected as they are uniquely placed to support prescription DTx. With the growth of the digital health industry, prominent telehealth providers may also choose to acquire DTx businesses or create their own in-house DTx solutions.

Read our related Perspective:
 COVID-19 Outbreak Boosts the Use of Telehealth Services

An increase in industry M&A activities can be expected in the next few years, with growing incidences of chronic illnesses, improved technology penetration across all age groups, and a maturing market. Big names such as Bayer, Novartis, and Sanofi are also entering into partnerships with DTx companies, indicating a bright future for the sector.

Mental health and behavioral therapy are great fields to branch out for companies starting in the DTx landscape, especially in this post-pandemic era. Demand for such services is likely to be sustained, considering the National Institute of Mental Health Disorders estimates that one in four adults in the USA suffers from a diagnosable mental illness, with many suffering from multiple conditions.

Similarly, diseases such as diabetes, cancer, heart, and respiratory ailments are on the rise. Healthcare companies can effectively address these medical areas through the use of DTx applications, providing personalized care for patients. This approach has the potential to manage not only chronic conditions such as diabetes but also terminal illnesses such as cancer.

Many DTx players will likely focus on areas with unmet needs, including pediatrics and metabolic disorders. With seven DTx-based diabetic management solutions already receiving 510(k) clearance as of December 2022, it can be expected that more products addressing the treatment gaps might flood the market.

The DTx industry is gradually maturing and has been receiving significant investments in recent years (US$8 billion in 2022). While experts view it as a profitable market, hesitation remains, particularly following the bankruptcy of Pear Therapeutics.

Nevertheless, due to the COVID-19 pandemic and subsequent lockdown measures, technology adoption among older adults has increased significantly. Hence, strategic investments in DTx by pharmaceutical and healthcare companies, taking into account market conditions, can expect to establish a stronger presence in this industry in the future.

Europe AI Regulation Deal – Beginning of a New Technological Era by EOS Intelligence
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Europe AI Regulation Deal – Beginning of a New Technological Era?

The proliferation of artificial intelligence (AI) applications in recent years has highlighted the importance of regulatory frameworks to ensure AI’s responsible use. Recognizing this, the EU has become the first global power to pass AI-related legislation. The EU AI Act, considered a watershed moment in today’s digital era, is expected to create ripples worldwide and prompt leaders to take initiatives to control the use of AI.

The AI industry, valued at US$454.1 billion in 2022, is predicted to reach US$2.6 trillion by 2032, according to a 2023 report by Canada/India-based market research company Precedence Research. Although this impressive increase in the use of AI offers immense potential, it has raised numerous concerns about its misuse. Many industry experts have voiced concern about how significantly AI impacts important industries such as education and health, and may eventually alter human lives.

Regulatory bodies and governments worldwide are also now aware of the risks of bias, discrimination, and privacy breaches that come with the unrestricted use of AI. A 2020 study published in Sustainable Development, an interdisciplinary journal, found that unchecked AI poses a threat to the Sustainable Development Goals (SDGs) established by the UN.

The EU took its first step in addressing concerns related to AI in April 2021 when it released the first draft of EU AI regulation. However, this draft was revised after the 2022 release of ChatGPT to include the newer technological advances with a future-proof approach that will enable the law to evolve as technology does.

The EU AI rule uses a risk-based strategy to divide AI systems into categories, namely unacceptable, high, limited, and minimal risk. Systems categorized in the unacceptable risk group will be banned, and those with high risk will undergo a rigorous assessment to understand their effect on fundamental rights and be given a CE mark before their market release.

The limited risk category that fulfills specific transparency requirements should follow EU copyright laws, prepare technical documentation, and release a synopsis of the training materials so the users can make an informed decision. Companies can release minimal-risk systems, such as spam filters and AI-powered video games, without restrictions.

The AI Act has also introduced certain transparency requirements for general-purpose AI (GPAI) models such as Gemini and ChatGPT. For powerful and highly effective models, there are additional risk management requirements, such as maintaining cybersecurity standards, conducting evaluations, assessing and mitigating risks, and reporting serious events.

The EU AI Act has several implications for business across the continent

Many industry experts consider the EU AI Act a significant regulatory tool for overseeing the advancement and utilization of AI technologies throughout the continent. The enforcement of this act is expected to influence significantly the operations, approaches, and competitive environment across several sectors in the EU, as well as intercontinental business with products traded in the European market.

Achieving compliance is one of the main challenges businesses will face with the introduction of the new EU AI law. The law comes with a hefty penalty for non-compliance, with most violations costing businesses €15 million, or 3% of their annual global turnover. Non-compliance concerning banned AI systems can result in fines of up to €35 million, or 7% of the company’s annual turnover. Furthermore, providing false, deceptive, or incomplete information may result in fines of up to €7.5 million, or 1.5% of the total turnover.

Any organization aiming for compliance needs to perform a gap analysis to identify disparities and enhance company processes, policies, and metrics. They must also provide the regulators with accurate, efficient, and timely answers. All these place a substantial organizational and economic burden on the companies.

Another challenge businesses can face is implementing all the changes needed to fill the compliance gap while being consistent with their internal structure. This will require the company to identify the metrics it needs to track to achieve compliance and design new organizational procedures to fulfill this. This should also be done in such a way that it does not hinder other strategic goals, such as innovation, budgetary constraints, etc., placing additional strain on the leadership.

Companies offering multiple AI solutions can face several complicated roadblocks with the implementation of the EU AI Act. Such organizations will be subject to a different set of regulations depending on the risk category of their AI products. This can lead to internal policy confusion.

Slower product development cycles and delays in product releases are other bottlenecks that companies will need to address with the act’s implementation. New AI-powered products, especially high-risk ones, now need to undergo more rigorous evaluation to ensure compliance, which can slow the entire process.

Players can also face challenges in M&A activities with the new regulations. Businesses will now need to spend more time and resources assessing the compliance of their merging partner before proceeding.

There are several opportunities for determined businesses

While the implementation of the EU AI Act does spell several challenges for businesses, it also offers opportunities for interested players. With the new act in place, customers will be able to place more trust in AI solutions. This will enhance the adoption of new AI-based systems.

Determined players can also improve innovation and gain investment with the help of Article 53 of the Act. This section states the possibility of establishing “regulatory sandboxes” that can be set up by one or more member states. These sandboxes offer controlled environments for developing, testing, and validating new AI technologies for a short time under the guidance of a competent authority. This will also ensure that the AI solutions fulfill regulatory compliance.

The EU AI Act offers special support measures to start-ups and SMEs. The compliance requirements for high-risk AI have been modified to make them less burdensome and technically feasible. Start-ups and SMEs also get a proportional cap on compliance infringement fines. This will make it easier for budding businesses in the AI sector to make leaps in innovation and product development.

Interested EU-based players can also receive support for product development through programs such as Testing and Experimentation Facilities, Data and Robotics Hubs, Digital Innovation Hubs, etc. The AI Office, set up by the EU AI Act to oversee the rules and regulations related to GPAI models, has established forums where stakeholders can exchange best practices and contribute to rules of conduct and practice. This can improve participation across industries and enhance inclusiveness.

EOS Perspective

The EU AI Act can be considered a landmark development in the regulation of AI technologies in Europe. It has extensive implications for businesses, society, and the economy on the continent and worldwide. Many industry leaders consider this act a starting point in AI regulation. Other countries are expected to follow in the EU’s footsteps soon and make similar laws curbing the effects of unregulated AI.

The EU AI Act is expected to make AI-based solutions safe and bias-free, with better transparency into their developmental processes. It is also expected to enhance accountability and create a more responsible approach to AI development and deployment.

Businesses, especially SMEs and start-ups, can expect several benefits from this act. Experts predict that with the renewed focus on safety and ethical issues, there will be large-scale development of far more trustworthy and robust AI-based solutions in the future.

Scarcity Breeds Innovation - The Rising Adoption of Health Tech in Africa by EOS Intelligence
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Scarcity Breeds Innovation – The Rising Adoption of Health Tech in Africa

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Africa carries the world’s highest burden of disease and experiences a severe shortage of healthcare workers. Across the continent, accessibility to primary healthcare remains to be a major challenge. During the COVID-19 pandemic, several health tech companies emerged and offered new possibilities for improving healthcare access. Among these, telemedicine and drug distribution services were able to address the shortage of health workers and healthcare facilities across many countries. New health tech solutions such as remote health monitoring, hospital automation, and virtual health assistance that are backed by AI, IoT, and predictive analytics are proving to further improve health systems in terms of costs, access, and workload on health workers. Given the diversity in per capita income, infrastructure, and policies among African countries, it remains to be seen if health tech companies can overcome these challenges and expand their reach across the continent.

Africa is the second most populated continent with a population of 1.4 billion, growing three times faster than the global average. Amid the high population growth, Africa suffers from a high prevalence of diseases. Infectious diseases such as malaria and respiratory infections contribute to 80% of the total infectious disease burden, which indicates the sum of morbidity and mortality in the world. Non-communicable diseases such as cancer and diabetes accounted for about 50% of total deaths in 2022. High rates of urbanization also pose the threat of spreading communicable diseases such as COVID-19, Ebola, and monkey fever.

A region where healthcare must be well-accessible is indeed ill-equipped due to limited healthcare infrastructure and the shortage of healthcare workers. According to WHO, the average doctor-to-population ratio in Africa is about two doctors to 10,000 people, compared with 35.5 doctors to 10,000 people in the USA.

Poor infrastructure and lack of investments worsen the health systems. Healthcare expenditure (aggregate public healthcare spending) in African countries is 20-25 times lower than the healthcare expenditure in European countries. Governments here typically spend about 5% of GDP on healthcare, compared with 10% of GDP spent by European countries. Private investment in Africa is less than 25% of the total healthcare investments.

Further, healthcare infrastructure is unevenly distributed. Professional healthcare services are concentrated in urban areas, leaving 56% of the rural population unable to access proper healthcare. There are severe gaps in the number of healthcare units, diagnostic centers, and the supply of medical devices and drugs. Countries such as Zambia, Malawi, and Angola are placed below the rank of 180 among 190 countries ranked by the WHO in terms of health systems. Low spending power and poor national health insurance schemes discourage people from using healthcare services.

Health tech solutions’ potential to fill the healthcare system gaps

As the prevailing health systems are inadequate, there is a strong need for digital solutions to address these gaps. Health tech solutions can significantly improve the access to healthcare services (consultation, diagnosis, and treatment) and supply of medical devices and drugs.

Health tech solutions can significantly improve the access to healthcare services (consultation, diagnosis, and treatment) and supply of medical devices and drugs.

For instance, Mobihealth, a UK-based digital health platform founded in 2017, is revolutionizing access to healthcare across Africa through its telemedicine app, which connects patients to over 100,000 physicians from various parts of the world for video consultations. The app has significantly (by over 60%) reduced hospital congestion.

Another example is the use of drones in Malawi to monitor mosquito breeding grounds and deliver urgent medical supplies. This project, which was introduced by UNICEF in 2017, has helped to curb the spread of malaria, which typically affects the people living in such areas at least 2-3 times a year.

MomConnect, a platform launched in 2014 by the Department of Health in South Africa, is helping millions of expectant mothers by providing essential information through a digital health desk.

While these are some of the pioneers in the health-tech industry, new companies such as Zuri Health, a telemedicine company founded in Kenya in 2020, and Ingress Healthcare, a doctor appointment booking platform launched in South Africa in 2019, are also strengthening the healthcare sector. A study published by WHO in 2020 indicated that telemedicine could reduce mortality rates by about 30% in Africa.

The rapid rise of health tech transforming the African healthcare landscape

Digital health solutions started to emerge during the late 2000’s in Africa. Wisepill, a South African smart pill box manufacturing company established in 2007, is one of the earliest African health tech success stories. The company developed smart storage containers that alert users on their mobile devices when they forget to take their medication. The product is widely used in South Africa and Uganda.

The industry gained momentum during the COVID-19 pandemic, with the emergence of several health tech companies offering remote health services. The market experienced about 300% increase in demand for remote healthcare services such as telemedicine, health monitoring, and medicine distribution.

According to WHO, the COVID pandemic resulted in the development of over 120 health tech innovations in Africa. Some of the health tech start-ups that emerged during the pandemic include Zuri Health (Kenya), Waspito (Cameroon), and Ilara Health (Kenya). Several established companies also developed specific solutions to tackle the spread of COVID-19 and increase their user base. For instance, Redbird, a Ghanaian health monitoring company founded in 2018, gained user attention by launching a COVID-19 symptom tracker during the pandemic. The company continues to provide remote health monitoring services for other ailments, such as diabetes and hypertension, which require regular health check-ups. Patients can visit the nearest pharmacy instead of a far-away hospital to conduct tests, and results will be regularly updated on their platform to track changes.

Scarcity Breeds Innovation – The Rising Adoption of Health Tech in Africa by EOS Intelligence

Start-ups offering advanced solutions based on AI and IoT have been also emerging successfully in recent years. For instance, Ilara Health, a Kenya-based company, founded during the COVID-19 pandemic, is providing affordable diagnostic services to rural population using AI-powered diagnostic devices.

With growing internet penetration (40% across Africa as of 2022) and a rise in investments, tech entrepreneurs are now able to develop solutions and expand their reach. For instance, mPharma, a Ghana-based pharmacy stock management company founded in 2013, is improving medicine supply by making prescription drugs easily accessible and affordable across nine countries in Africa. The company raised a US$35 million investment in January 2022 and is building a network of pharmacies and virtual clinics across the continent.

Currently, 42 out of 54 African countries have national eHealth strategies to support digital health initiatives. However, the maximum number of health tech companies are concentrated in countries such as South Africa, Nigeria, Egypt, and Kenya, which have the highest per capita pharma spending in the continent. Nigeria and South Africa jointly account for 46% of health tech start-ups in Africa. Telemedicine is the most offered service by start-ups founded in the past five years, especially during the COVID-19 pandemic. Some of the most popular telemedicine start-ups include Babylon Health (Rwanda), Vezeeta (Egypt), DRO Health (Nigeria), and Zuri Health (Kenya).

Other most offered services include medicine distribution, hospital/pharmacy management, and online booking and appointments. Medicine distribution start-ups have an immense impact on minimizing the prevalence of counterfeit medication by offering tech-enabled alternatives to sourcing medication from open drug markets. Many physical retail pharmacy chains, such as Goodlife Pharmacy (Kenya), HealthPlus (Nigeria), and MedPlus (Nigeria), are launching online pharmacy operations leveraging their established logistics infrastructure. Hospitals are increasingly adopting automation tools to streamline their operations. Electronic Medical Record (EMR) management tools offered by Helium Health, a provider of hospital automation tools based in Nigeria are widely adopted in six African countries.

Medicine distribution start-ups have an immense impact on minimizing the prevalence of counterfeit medication by offering tech-enabled alternatives to sourcing medication from open drug markets.

For any start-up in Africa, the key to success is to provide scalable, affordable, and accessible digital health solutions. Low-cost subscription plans offered by Mobihealth (a UK-based telehealth company founded in 2018) and Cardo Health (a Sweden-based telehealth company founded in 2021) are at least 50% more affordable than the average doctor consultation fee of US$25 in Africa. Telemedicine platforms such as Reliance HMO (Nigeria) and Rocket Health (Uganda) offer affordable health insurance that covers all medical expenses. Some governments have also taken initiatives in partnering with health tech companies to provide affordable healthcare to their people. For instance, the Rwandan government partnered with a digital health platform called Babylon Health in 2018 to deliver low-cost healthcare to the population of Rwanda. Babylon Health is able to reach the majority of the population through simple SMS codes.

Government support and Public-Private Partnerships (PPPs)

With a mission to have a digital-first universal primary care (a nationwide program that provides primary care through digital tools), the Rwandan government is setting an example by collaborating with Babylon Health, a telemedicine service that offers online consultations, appointments, and treatments.

As part of nationwide digitization efforts, the government has established broadband infrastructure that reaches 90% population of the country. Apart from this, the country has a robust health insurance named Mutuelle de Santé, which reaches more than 90% of the population. In December 2022, the government of Ghana launched a nationwide e-pharmacy platform to regulate and support digital pharmacies. Similarly, in Uganda, the government implemented a national e-health policy that recognizes the potential of technology in the healthcare sector.

MomConnect, a mobile initiative launched by the South African government with the support of Johnson and Johnson in 2014 for educating expectant and new mothers, is another example of a successful PPP. However, apart from a few countries in the region, there are not enough initiatives undertaken by the governments to improve health systems.

Private and foreign investments

In 2021, health tech start-ups in Africa raised US$392 million. The sustainability of investments became a concern when the investments dropped to US$189 million in 2022 amid the global decline in start-up funding.

However, experts predict that the investment flow will improve in 2023. Recently, in March 2023, South African e-health startup Envisionit Deep AI raised US$1.65 million from New GX Ventures SA, a South African-based venture capital company. Nigerian e-health company, Famasi, is also amongst the start-ups that raised investments during the first quarter of 2023. The company offers doorstep delivery of medicines and flexible payment plans for medicine bills.

The companies that have raised investments in recent years offer mostly telemedicine and distribution services and are based in South Africa, Nigeria, Egypt, and Kenya. That being said, start-ups in the space of wearable devices, AI, and IoT are also gaining the attention of investors. Vitls, a South African-based wearable device developer, raised US$1.3 million in funding in November 2022.

Africa-based incubators and accelerators, such as Villgro, The Baobab Network, and GrowthAfrica Accelerator, are also supporting e-health start-ups with funding and technical guidance. Villgro has launched a US$30 million fund for health tech start-ups in March 2023. Google has also committed US$4 million to fund health tech start-ups in Africa in 2023.

Digital future for healthcare in Africa

There were over 1,700 health tech start-ups in Africa as of January 2023, compared with about 1,200 start-ups in 2020. The rapid emergence of health tech companies is addressing long-running challenges of health systems and are offering tailored solutions to meet the specific needs of the African market.

Mobile penetration is higher than internet penetration, and health tech companies are encouraged to use SMS messaging to promote healthcare access. However, Africa is expected to have at least 65% internet penetration by 2025. With growing awareness of the benefits of health tech solutions, tech companies would be able to address new markets, especially in rural areas.

Companies that offer new technologies such as AI chatbots, drones, wearable devices for remote patient monitoring, hospital automation systems, e-learning platforms for health workers, the Internet of Medical Things (IoMT), and predictive analytics are expected to gain more attention in the coming years. Digitally enabled, locally-led innovations will have a huge impact on tackling the availability, affordability, and quality of health products and services.

Digitally enabled, locally-led innovations will have a huge impact on tackling the availability, affordability, and quality of health products and services.

Challenges faced by the health tech sector  

While the African health tech industry has significantly evolved over the last few years, there are still significant challenges with regard to infrastructure, computer literacy, costs, and adaptability.

For instance, in Africa, only private hospitals have switched to digital records. Many hospitals still operate without computer systems or internet connections. About 40% of the population are internet users, with countries such as Nigeria, Egypt, South Africa, Morocco, Ghana, Kenya, and Algeria being the ones with the highest number of internet users (60-80% of the population). However, 23 countries in Africa still have low internet penetration (less than 25%). This is the major reason why tech companies concentrate in the continent’s largest tech hubs.

On the other hand, the majority of the rural population prefers face-to-face contact due to the lack of digital literacy. Electricity and internet connectivity are yet to reach all parts of the region and the cost of the internet is a burden for many people. Low-spending power is a challenge, as people refuse to undergo medical treatment due to a lack of insurance schemes to cover their medical expenses. Insurance schemes provided in Africa only cover 60% of their healthcare expenses. Even though health tech solutions bring medical costs down, these services still remain unaffordable for people in low-income countries. Therefore, start-ups do not prefer to establish or expand their services in such regions.

Another hurdle tech companies face is the diversity of languages in Africa. Africa is home to one-third of the world’s languages and has over 1,000 languages. This makes it difficult for companies to customize content to reach all populations.

Amidst all these challenges, there is very little support from the governments. The companies face unfavorable policies and regulations that hinder the implementation of digital solutions. Only 8% of African countries have online pharmacy regulations. In Nigeria, regulatory guidelines for online pharmacies only came into effect in January 2022, and there are still unresolved concerns around its implementation.

Lack of public investment and comprehensive government support also discourage the local players. Public initiatives are rare in providing funding, research support, and regulatory approval for technology innovations in the health sector. Private investment flow is low for start-ups in this sector compared to other industries. Health tech start-ups raised a total investment of US$189 million in 2022, which is not even 10% of the total investments raised by start-ups in other sectors in Africa. Also, funding is favored towards the ones established in high-income countries. Founders who don’t have ties to high-income countries struggle to raise funds.

EOS Perspective

The emergence of tech health can be referred to as a necessary rise to deal with perennial gaps in the African healthcare system. Undoubtedly, many of these successful companies could transform the health sector, making quality health services available to the mass population. The pandemic has spurred the adoption of digital health, and the trend experienced during the pandemic continues to grow with the developments in the use of advanced technologies such as AI and IoT. Telemedicine and distribution have been the fastest-growing sectors driven by the demand for remote healthcare services during the pandemic. Home-based care is likely to keep gaining momentum with the development of advanced solutions for remote health monitoring and diagnostic services.

Home-based care is likely to keep gaining momentum with the development of advanced solutions for remote health monitoring and diagnostic services.

With the increasing internet penetration and acceptance of digital healthcare, health tech companies are likely to be able to expand their reach to rural areas. Right policies, PPPs, and infrastructure development are expected to catalyze the health tech adoption in Africa. Companies that offer advanced technologies such as IoT-enabled integrated medical devices, AI chatbots, drones, wearable devices for remote patient monitoring, hospital automation systems, e-learning platforms for health workers, and predictive analytics for health monitoring are expected to emerge successfully in the coming years.

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