Since joining Creandum I have spent a lot of time within Digital Health, both with Creandum's portfolio companies, but also looking out for new interesting companies. And by doing so I'm more and more convinced about the opportunities related to tackling chronic diseases, also known as non-communicable diseases (NCDs). Even more so, I'm convinced of the NEED of tackling NCDs - millions of people and their families are impacted and the number is expected to increase. Prevention plays a large role in this, but helping those already affected is also vital.
Creandum's Fund's investment in Virta Health is one example within this area - they just announced results of a clinical trial where they've been able to reverse type 2 diabetes in 60% of their patients. But there are likely many more opportunities out there to tackle conditions such as asthma, osteoarthritis, heart conditions, or autoimmune diseases. So, what makes me so convinced?
1) The prevalence is huge - and unfortunately growing.
Managing chronic diseases is one the main challenges for our society today, and not least for the affected individuals and families. NCDs are by far the most common cause of death worldwide, being the cause for more than 6 of 10 deaths.
In the US almost half of all adults, roughly 120m people, suffer from one or more NCDs. As the population grow older and risk factors such as poor diet and lack of exercise become more common, this number is expected to increase.
2) Double cost to society: driving healthcare expenditures and economic loss.
As one would expect, long term conditions lead to higher costs. Across the world, an average 10% of GDP is spent on healthcare, and in most countries the vast majority is due to chronic diseases. American healthcare expenditures equal an astonishing 17% of GDP, of which +80% is related to NCDs, meaning that over 13% of GDP or over 2 TRILLION are spent yearly on NCDs (as a reference education exp. is ~5% of GDP). While being the major driver of healthcare costs, many people don't receive sufficient treatment, especially in developing countries.
But the direct expenditure is not the only cost. Only within Europe, roughly 555,000 people die at premature age from chronic disease. The economic loss of these premature deaths is estimated at around €115bn.
3) Most importantly - Opportunity to improve outcomes - not only generate cost savings.
Treatment today is based on time intervals, or other static intervals - not on personalized individual care. This means that a lot of recourse and visits are put in too early (simply scheduled as a check-up that could be avoided or done using other means than physical visit) OR too late, e.g. as a response to complication. As an example over 30% of patients who undergo chemotherapy end up at the ER within four weeks.
In fact, people with chronic conditions are three times more likely to have an unnecessary hospitalization. And those with five or more chronic conditions are 99 times more likely to have an unnecessary hospitalization.
There is a solution. Leveraging tech to enable e.g. symptom tracking can identify the need for visit or change in treatment before patient needs to go to the ER. Even if there isn't an acute situation to be avoided, self-tracking, remote monitoring, or other continuous intervals lead to better outcomes as it provides both patient and doctor with a better understanding of the condition and a fact based decision support. Additionally, the impact of putting the patient in a situation where they have more transparency and control should not be underestimated.
In short, tech (in form of e.g. continuous and remote monitoring, communication between visits, adherence reminders and follow-ups, AI for predicting complications, and a bunch of other stuff people smarter than I will figure out) will not only generate cost savings but also significantly improve the quality. Better quality means people can live longer and healthier lives - that's what makes this area truly interesting!
(here's some more on that topic: https://blog.virtahealth.com/continuous-remote-telemedicine/)
4) UX designed for a long-term relationship.
As the name implies, chronic conditions do not vanish and there is a need for people to manage and live with their disease.
An interface where the consumer is in charge and benefit continously from a tech-enabled treatment can help form a long lasting, and valuable relationship. While there is of course a lot things to be improved on the medical professional side, I see the major improvements and disruptions coming from innovations which involve the patient - and potentially also the people around them.
Tech can help by increasing motivation and understanding of why the patient needs to take certain actions. As an example, medication is not the only way to control asthma. It is also important to avoid triggers, such as cold air, pollution or other things that irritate and inflame the airways. Each patient must learn what triggers to avoid and how to identify them. As external conditions vary over time, these must be monitored and actions or medication adapted continuously. Providing this with a UX that has more in common with consumer products patients are already using to will likely provide better outcomes– and even closer relationship than what most have with the healthcare providers today. As with any other business, your LTV is a dependent on your retention. Here your LTV in addition impacts real life.
As you can see, there are strong economic arguments why startups targeting chronic diseases are in an exciting space. As a VC, I'm convinced there's a lot of value creation to made for patients, for society, and for companies by finding ways to handle NDCs.
But on a more human level, when evaluating healthtech companies I also speak to their customers, and I've seen first hand how modern, user-friendly tools for managing chronic diseases can have an incredibly positive impact on those who suffer. Looking at the statistics above, you likely know someone who suffers from asthma, heart conditions, osteoarthritis, diabetes or autoimmune diseases, and you likely know as well as I do how painful unnecessary trips to the hospital can be, or how small improvements in healthcare technology can completely change a patient's outlook on life.
I would love to hear your thoughts. Or even better, if you are already working on this - please feel free to reach out!
