Digital era remaking healthcare

China's healthcare industry has marched into the digital era, and digitalization will penetrate the field from inside to outside hospitals, from treatment to prevention and from its top levels to the grassroots, a recent report said.

The report, by EqualOcean Intelligence, a Beijing-based think tank, said that subcategories of digital healthcare, including electronic medical records, e-commerce pharmacies, health insurance and digital healthcare marketing, have reached a mature stage.

Other subcategories are still in an exploratory stage, yet have great development potential, it said.

In 2020, there were 69 significant investment deals in China's digital healthcare sector, up 25.4 percent on a year-on-year basis, the report said. From January to August, there were 47 such investment deals in the sector.

"COVID-19 has accelerated the digitalization process of China's healthcare industry," said Gao Xuezhen, research director at EqualOcean Intelligence. "Given the pandemic, telemedicine, online doctor-patient communication and online visits have become the best solutions. Both the patients' and doctors' acceptance of visits and drug purchasing online increased, which promoted the industry's investment in digitalization."

EqualOcean Intelligence said that in 2019, digitalization-related expenses represented roughly 23 percent of China's total hospital costs. By March 2020, the ratio had increased to 40 percent.

Researchers also are increasingly paying attention to digital healthcare. In 2020, there were 2,291 newly published reports related to digital healthcare, the think tank said. The figure is forecast to reach 2,539 by the end of this year. Hot topics include internet hospitals that provide remote consultations, electronic medical records, 3D printing, wearable devices and genetic big data.

Many internet-based platforms are eagerly developing digital healthcare.

Ping An Healthcare and Technology Co Ltd, also known as Ping An Good Doctor, a leading online medical and health service platform in China, reported that as of June 30, its half-year revenue surged 39 percent year-on-year to 3.8 billion yuan ($597 million).

Revenue from medical services grew by 50.6 percent year-on-year and contributed revenue of nearly 1.1 billion yuan. Revenue from consumer healthcare grew by 66.1 percent year-on-year to 714 million yuan.

Its registered users reached 400 million, an increase of nearly 55 million from the same period in 2020, the company said.

The platform, which uses artificial intelligence, offers high-quality online healthcare to consumers. Apart from online diagnoses, digital technologies help the company to streamline business functions by reducing the need for humans 'repetitive tasks, raising doctors' efficiency and lowering costs.

"Ping An Good Doctor will further strengthen its strategic upgrades," said Fang Weihao, chairman and CEO of the company, who spoke at a news conference. Fang said the company would focus on business-to-consumer "premium users" and introduce family doctor memberships. It will continue to improve online-to-offline services, "and strive to provide our customers with an easier, faster and more affordable user experience".

While public hospitals, private medical institutions and pharmaceutical companies are all eyeing digital healthcare, they each have a different focus.

EqualOcean Intelligence said that at the current stage, electronic medical records and hospital interconnections are the main areas of emphasis for China's public, 3A-grade hospitals, which are the largest, highest-level facilities.

By 2020, 172 hospitals in China had passed an assessment of electronic medical records, which evaluates the degree to which records are digitized. Among them, 145 were public 3A-grade hospitals, representing 84.3 percent. Between 2016 and 2020, the hospitals that had achieved interconnection with other hospitals surged from nine to 148, according to the National Health Commission.

"Compared to public hospitals, the digitalization process of private medical institutions was rather slow," said Gao, the research director. "In addition, the building of digital client management has been their unique direction."

Gao said that especially the medical aesthetics sector, including plastic surgery, categorizes clients into different groups so that they can use precise marketing strategies to "bring more income to institutions".

Pharmaceutical enterprises are also increasing their investments in digitalization. Digital marketing is the sector that received the most investment, and it also is the most-developed sector.

Multinational pharmaceutical companies spend 10 to 20 percent of their sales revenue on building their digital marketing, while domestic companies usually spend 5 to 10 percent. This spending helped the companies explore grassroots-level markets and increase the efficiency of their communications.

Meanwhile, digital efforts also are being made in drug research and development and exploration of new treatment plans, the report said.

Meng Lilian, chief expert at the Sichuan Tianfu Health Industry Research Institute, said: "China's digital healthcare industry is in a growth stage. On one hand, the infrastructure construction is insufficient, which makes each medical institution independent from each other, and there are information imbalances.

"On the other hand, there are not enough digital products and services to offer to the digital healthcare industry."

Meng said that "to promote the high-quality development of China's digital healthcare industry, both top-level design and concrete efforts are needed. There is steady progress in related work. The government, especially, has invested many resources in the building of application scenarios."

"In addition, effective collaboration is needed among governmental supervision, the supply of digital healthcare products and the response from digital healthcare consumers," he added.