PWC report projects booming market in personalized medicine

The new science of personalized medicine, a new report on the $232 billion personalized medicine industry by PriceWaterhouseCoopers, anticipates an annual 11% growth in this market.  Health IT and telemedicine are among the key drivers for personalized medicine. 

According to Healthcare IT News, the report's findings include:

  • The core diagnostic and therapeutic segment of the market – made up primarily of pharmaceutical, medical device and diagnostics companies – is estimated at $24 billion and expected to grow by 10 percent annually, reaching $42 billion by 2015.
  • The personalized medical care portion of the market – including telemedicine, health information technology and disease management services offered by traditional health and technology companies – is estimated at $4 billion to $12 billion and could grow to more than $100 billion by 2015 if telemedicine takes off.
  • The related nutrition and wellness market – including retail, complementary and alternative medicines offered by consumer products, food and beverage, leisure and retail companies – is estimated at $196 billion and projected to grow 7 percent annually to more than $290 billion by 2015.

You can find the full report here.

"IT helps drive $232B personalized medicine market," Healthcare IT News (December 8, 2009).

Study: US lags behind other nations in HIT use

A study conducted by the Commonwealth Fund, published in this month's issue of Health Affairs, found that physicians in the United States significantly lag behind their colleagues in Western Europe, Australia and New Zealand in several categories, including rates of adoptions of electronic medical records.  This study of more than 10,000 primary care physicians in 11 countries found that only 46% of U.S. doctors use electronic medical records, compared with almost universal EMR use among doctors in Australia (95%), Italy (94%), the Netherlands (99%), New Zealand (97%), Norway (97%), Sweden (94%), and the United Kingdom (96%).  Among other HIT-related findings, the study concluded that:

<...> among the seven countries with near-universal EMRs, the majority of physicians reported electronic access to lab results, yet fewer than half of Dutch, Norwegian, and U.K. doctors can order tests electronically. Across countries, most doctors with EMRs reported electronic clinical notes, routine electronic prescribing, and computerized alerts about potential problems with drug doses or interactions (except in Norway). Answers varied for other functions.

Decision support appears generally less well developed. Computerized reminders for treatment guidelines, tracking laboratory tests, and prompts to provide patients with test results were the least frequently reported, including in countries with multifunctional capacity. Notably, the seven countries with near-universal EMRs have succeeded in spreading multifunctional capacity to smaller as well as larger practices. Their national policies and standards have supported spread of multifunctional capacity. In contrast, U.S. multifunctional capacity remains concentrated in larger practices. Half of U.S. practices with high-function capacity were associated with integrated care systems such as Kaiser.

However, the study also found a high rate of increase of EMR use among U.S. doctors, rising from 28% to 46% from 2006 to 2009.  At the same time, only 26% of U.S. physicians were reported to have "advance electronic information capacity" (i.e., reporting use of more 9 - out of 14 - clinical IT functions such as e-prescribing and ordering tests, Rx alerts, clinical notes, and others).

The situation seems even more dire in Canada, where only 37% of physicians use EMRs, and only 14% have "advance electronic information capacity."

On the access, cost and quality of care issues, the Commonwealth Fund study found that:

More than half (58%) of U.S. physicians—by far the most of any country surveyed—said their patients often have difficulty paying for medications and care. Half of U.S. doctors spend substantial time dealing with the restrictions insurance companies place on patients’ care.

Only 29 percent of U.S. physicians said their practice had arrangements for getting patients after-hours care—so they could avoid visiting a hospital emergency room. Nearly all Dutch, New Zealand, and U.K. doctors said their practices had arrangements for after-hours care.

Twenty-eight percent of U.S. physicians reported their patients often face long waits to see a specialist, one of the lowest rates in the survey. Three-quarters of Canadian and Italian physicians reported long waits.

While all the countries surveyed use financial incentives to improve the quality of care, primary care physicians in the U.S. are among the least likely to be offered such rewards; only one-third reported receiving financial incentives. Rates were also low in Sweden (10%) and Norway (35%), compared with large majorities of doctors in the U.K. (89%), the Netherlands (81%), New Zealand (80%), Italy (70%), and Australia (65%).

Patients with chronic illness require substantial time with physicians, education about their illness, and coaching about treatment, diet, and medication regimens. Care teams composed of clinicians and nurses have been shown to be effective in providing care to people with chronic conditions and in improving outcomes. The use of such teams is widespread in Sweden (98%), the U.K. (98%), the Netherlands (91%), Australia (88%), New Zealand (88%), Germany (73%), and Norway (73%). It is less prevalent in the U.S. (59%) and Canada (52%), with France (11%) standing out on the low end.

You can find the Commonwealth Fund study here, and please be sure to take a look at the accompanying graphs here.

"A Survey Of Primary Care Physicians In Eleven Countries, 2009: Perspectives On Care, Costs, And Experiences," Health Affairs (November 5, 2009).

Health IT Market Heats Up

The last few weeks saw a tremendous amount of activity in the health IT market.  Dell and Xerox were among the companies trying to capitalize on opportunities created by the ARRA incentives and certain market trends, including high demand for HIT products due to the ongoing digitization of the industry and, more generally, the expanding healthcare needs of an aging population in the United States.

Dell is quickly establishing itself as a major player in health IT.  In April 2009, Dell aligned itself with Wal-Mart and eClinical Works to supply hardware for Wal-Mart's new EHR system.  Last month, Dell rolled out its own EHR system aimed at physicians affiliated with hospital practices, with Tufts Medical Center and Memorial Hermann Health Care System among the early adopters. 

Even more significantly, on September 21, 2009, Dell announced its plans to acquire the health IT vendor Perot Systems Corp. for $3.9 billion.  Perot is a major player in the healthcare industry:  about half of Perot's $2.8 billion in annual revenue comes from the healthcare market; and as much as half of the hospitals that outsource their IT are Perot clients.   Perot runs over 3,000 healthcare applications for its clients, though the company does not have a preferred provider arrangement with a specific application vendor.

A mere week following Dell's announcement, Xerox's CEO Ursula M. Burns revealed her company's "game-changer" plan to buy Affiliated Computer Services (ACS) for $6.4 billion.  According to IT World:

ACS may be in a good position to get even more business in the next few years as the federal government starts spending billions of dollars to help health care providers create electronic medical records systems. ACS said that health care projects account for about $1 billion of its $6.5 billion in revenue for the year ended June 30.

While Dell and Xerox acquisitions grabbed most of the spotlight this week, other Wall Street giants, like Wal-Mart Stores, Inc., Intel and Google, havemade significant inroads into the health  IT market.  Healthcare consultants Frost & Sullivan, as cited in Healthcare IT News, see an expanding market which will benefit new players.

Companies with a fresh, outside perspective will be invaluable to improving healthcare delivery and producing the next generation of medical technology <...> The enormous demand for new technology and solutions to address both the clinical needs of patients and the systemic problems of healthcare delivery will create opportunities for companies with the foresight to identify and capitalize on opportunities.

However, Frost & Sullivan also cautions companies against jumping into this industry without considering potential downsides, including the incredibly complex regulatory framework governing U.S. healthcare.

Joseph Conn, "Dell's HIT Power Play," Modern Healthcare (September 28, 2009).

"Dell to Buy Perot Systems for About $3.9 Billion," The New York Times (September 21, 2009).

"Major corporations looking for stake in healthcare, medical technology market," Healthcare IT News (October 1, 2009).

"Doc, you're getting a Dell (EMR)," Healthcare IT News (September 10, 2009).

"Xerox Buys Affiliated, Fueling Shift to Services," The New York Times (September 28, 2009).

"With ACS, Xerox will gain a firm growing quickly offshore," IT World (September 28, 2009).