Digital Health – A complex and opaque marketplace

Sifted suggests that the NHS’s recent deal with Microsoft indicates that a risk-averse culture still rules major purchasing decisions in the healthcare sector: “The NHS’s recent deal with Microsoft (reportedly worth hundreds of millions and designed to give staff access to Microsoft 365 digital tools) is a stark warning to startups and small businesses; they may have got a look-in when the stakes were high, but the big money is still headed in the direction of the massive corporates. SMEs and smaller companies, often founded by those who have stronger, more direct experience of the problem they’re trying to solve and more innovative solutions, may once again be left out in the cold.” 

Anthony Anandan confirms this impression of the healthcare sector. He says, “My experience from working in public health sectors both in the UK and overseas is that these organisations can tend to be extremely risk-averse and therefore apply extra layers of governance which can therefore slow down decision-making ability. Similarly, with compliance, from a public sector perspective, there is often a nervousness in collaborating with the private sector.” 

Lyndon Johnson recalls a comment from Patients Know Best Founder Mohammad Al-Ubaydli ‘Nobody ever got fired for buying a Cerner or an Epic’. He is inferring that the CIOs who are ultimately responsible for software purchases do not get in trouble for making multi-million-pound decisions if they are buying well-established solutions. If they are going to buy innovative software from SMEs, it is key that the right governance is applied.

8foldGovernance’s experience is that many Start-Ups are ill-prepared for the complexity and culture of many of the healthcare institutions they are selling in to. Lyndon Johnson explains, “Too often we would see companies reach the point where they had secured their first significant deal and then discover that many mandatory governance requirements have not been met. The first time you hear, ‘do you have an NHS Data Security and Protection Toolkit’, ‘Can you send me over your Data Protection Impact Assessment?’ or ‘Can we see your Clinical Safety Case Report, Hazard log, Risk Management Plan and Incident Log?’ should not be in the closing stages of a deal. It can lead, at best to delays, and at worst the loss of a deal or confidence with your client.”

This is corroborated by start-up founder Anas Nader whose Patchwork app allows healthcare workers to access flexible shifts while reducing NHS reliance on agencies to fill vacancies. Anas told the FT, ‘Most of us innovators in the NHS have gone through ups and downs … It’s a challenging journey, especially when you are in a market that has established businesses. New players will find it hard to navigate.” 

This challenge is not only confined to UK-based operators. International health tech innovators and SMEs will often approach the UK market as a test-bed to establish and validate their products. As Lyndon Johnson notes, “EU health tech companies will need more help accessing the UK market and understanding the UK, particularly in the wake of Brexit.”

This Blog is an excerpt from the 8folGovernance White Paper written by Sussex Innovation LINK


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