Telemedicine

Telemedicine and online prevention

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Telemedicine and online prevention

Country
Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Health Care
Sub Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Health Care Providers
Indicative Return
Describes the rate of growth an investment is expected to generate within the IOA. The indicative return is identified for the IOA by establishing its Internal Rate of Return (IRR), Return of Investment (ROI) or Gross Profit Margin (GPM).
> 25% (in IRR)
Investment Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Medium Term (5–10 years)
Market Size
Describes the value of potential addressable market of the IOA. The market size is identified for the IOA by establishing the value in USD, identifying the Compound Annual Growth Rate (CAGR) or providing a numeric unit critical to the IOA.
> USD 1 billion
Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.
USD 500,000 - USD 1 million
Direct Impact
Describes the primary SDG(s) the IOA addresses.
Good health and well-being (SDG 3) Industry, Innovation and Infrastructure (SDG 9)
Indirect Impact
Describes the secondary SDG(s) the IOA addresses.
No Poverty (SDG 1) Industry, Innovation and Infrastructure (SDG 9)

Business Model Description

Allow medical consultation and telemedicine to underserved communities to receive remote medical services, sold to consumers through a dynamic, per-user model that allows not only for external consultation but first care Q&As with information available coordinated with Insurance Providers, Health providers, and MinSalud

Expected Impact

This initiative intends to provide medicine to underserved communities as a remote medical service to prevent treatable diseases.

How is this information gathered?

Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.

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Country & Regions

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Sector Classification

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Sector

Health Care

Development need
Colombia is the 4th largest pharmaceutical market in Latin America (5) 1.28M employees in pharma and healthcare (5) USD$ 14.3B in public healthcare expenditure (5)

Policy priority
The National Development Plan seeks to achieve the satisfaction of users with quality and opportunity of care, as well as to provide human talent and the health infrastructure of the different regions. Similarly, it seeks to directly face hypertension and the risk of cerebrovascular and heart diseases.

Gender inequalities and marginalization issues
Of the employed women in rural areas, 6.9% have no health affiliation 13% of indigenous populations that are not affiliated to the national health system, but also the remaining 87% who can improve the service they receive

Investment opportunities
M&A activity was quite vigorous in 2018 and 2019 and concentrated mainly in the medical cannabis manufacturing and private healthcare segments (5).

Key bottlenecks
> A significant driver for the development of healthcare sector is a rising demand for high-complexity medical services (5). > Also, a key restraining factor for the subsector is the rising shortage of medical professionals stemming from poor working conditions and structural problems in the domestic educational system (5).

Sub Sector

Health Care Providers

Development need
> Currently, out of 8,000 IPS, only 37 are accredited (6) > 77,456 medical professionals in Colombia registered in the Special Registry of Health Services Providers (5) > Even large and important cities have less than 9% of the national total number of Medical Professionals (5) > With the pandemic, providers, have been forced to expand their virtual care network. However, many still experience problems and do not reach dispersed rural areas.

Policy priority
> Law 1955 of 2019 specifies that MinSalud must promote the management of the provision of health services, through advances and improvements in connectivity in remote areas of the country, in coordination with the guidelines of MinTIC (e.g. telehealth programs)(20).

Gender inequalities and marginalization issues
> 90% of indigenous territories are located in border departments, which will need benefit for a telemedicine appointment (10).

Investment opportunities
> In September 2019, Spanish diagnostic services provider Atrys Health acquired Colombian peer Teleradiologia de Colombia Diagnostico Digital Especializado, specialized in telemedicine, for an undisclosed amount (5).

Key bottlenecks
> Only 42.56% of households in Colombia have computers and/or tablets, reducing the population that can get internet access > 23.8M people have no internet presenting significant asymmetries between urban and rural, where 45.7% in the head municipalities have connectivity vs. 6.2 % in scattered rural areas

Industry

Health Care Delivery

Pipeline Opportunity

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Investment Opportunity Area

Telemedicine and online prevention

Medical consultation and telemedicine platforms that allow underserved communities to receive remote medical prevention services
Business Model

Allow medical consultation and telemedicine to underserved communities to receive remote medical services, sold to consumers through a dynamic, per-user model that allows not only for external consultation but first care Q&As with information available coordinated with Insurance Providers, Health providers, and MinSalud

Business Case

Learn about the investment opportunity’s business metrics and market risks.

Market Size and Environment

Market Size (USD)
Describes the value in USD of a potential addressable market of the IOA.

> USD 1 billion

CAGR
Describes the historical or expected annual growth of revenues in the IOA market.

> 25%

Approximately 23.6M general medicine services are offered in Colombia every year (16). Of these services, 12% could be easily diverted to telemedicine, which on averages saves USD$ 927/service to the health system (17), estimating a USD$ 2.6B market.

The global telehealth market size was valued at USD% 61.4B, projected to reach USD$ 559.52B by 2027, exhibiting a CAGR of 25.2% during this period (7).

Indicative Return

IRR
Describes an expected annual rate of growth of the IOA investment.

> 25%

ROI
Describes an expected return from the IOA investment over its lifetime.

20% - 25%

Organizations that implement and track ROI saw annual returns of 20% or more (18)

Cost-Benefit analysis of Telemedicine in Greek remote areas resulted in IRR between 21.5% to 140.5% (8)

French from Idinvest Partners sold TeleClinic, a telemedicine platform in Germany, to a Swiss pharmaceutical, generating a 40% IRR (9)

Investment Timeframe

Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.

Medium Term (5–10 years)

Based on the Colombian transaction of a company specialized in software solutions for custom telemedicine, the investment timeframe resulted in 6 years (37). The latter was complemented by investors interviewed, who proposed a range of 5 to 7 years for this type of investment.

Ticket Size

Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.

USD 500,000 - USD 1 million

Market Risks & Scale Obstacles

Capital - CapEx Intensive

There is a lack of inputs, equipment, forms and means of communication, and technical platforms, to develop the computer and telecommunications infrastructure that guarantee connectivity for implementation. Therefore, a significant investment is necessary to achieve the goals of this initiative.

Capital - Requires Subsidy

Because it is trying to reach rural communities, these communities are in a subsidized health regime. In other words, the State must cover the health expenses of the people who access this service.

Impact Case

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Sustainable Development Need

Only 80% of healthcare providers schedule a medical appointment in 5 days or less (1).

Healthcare in remote regions such as Guainía, Guaviare, Vaupés, and Vichada is limited because of understaffing, and thus they offer less than half of the required medical services (1).

The national health system has accumulated a debt that is between COP$ 9.6 trillion (~USD$ 2.7 trillion) and COP$ 16.2 trillion (~USD$ 4.6 trillion)(1).

Gender & Marginalisation

13% of indigenous populations that are not affiliated to the national health system, but also the remaining 87% who can improve the service they receive.

90% of indigenous territories are located in border departments that will benefit from a telemedicine appointment (10).

Of the employed women in rural areas, 6.9% have no health affiliation.

Expected Development Outcome

Provide critical preventive, primary, and secondary health care services to patients in parts of the country that are either remote and/or not covered by the public healthcare system, offering better access to more specialists regardless of location.

Remote analysis and monitoring services significantly reduce healthcare service costs, saving patients' money, doctors, and insurance companies. Telemedicine also reduces unnecessary non-urgent ER visits and eliminates transportation expenses for regular checkups.

Telemedicine can create efficiencies with staff, and therefore reduce costs while improving the quality of services. It reduces costs by lowering readmission rates as telemedicine leads to increased frequency of consultations with patients who have been discharged (11).

Gender & Marginalisation

Improve the health service that indigenous people receive and more timely service to the majority affiliated with the health system. Also, to include in the service 13% of these groups that do not have coverage.

Due to the remoteness and geographical difficulties, 90% of the population that is located in border territories could receive timely health care to improve diseases and mortality.

Rural women who are currently excluded from the health system could be reached, either because of their remoteness or the geographical difficulties of reaching them.

Primary SDGs addressed

Good health and well-being (SDG 3)
3 - Good Health and Well-Being

3.8.1 Coverage of essential health services

3.4.1 Mortality rate attributed to cardiovascular disease, cancer, diabetes or chronic respiratory disease

3.c.1 Health worker density and distribution

Current Value

From 59.1% to 100% of the population were covered by the social security system as of 2018 (26).

> Cardiovascular mortality rate: (2017) 83.7 out of 100,000 people between 30 and 70 years (26). > Cancer mortality rate: (2018) 60.3 out of 100,000 people between 30 and 70 years, showing an upward tendency since 2015 (26). > Diabetes mortality rate: (2018) from 9.4 to 28.5 people between 30 and 70 years depending on the department (26). > Respiratory diseases mortality rate: (2018) from 4.1 to 18.1 people between 30 and 70 years depending on the department (26).

> Bogota has a ratio of 3.7 doctors per 1,000 inhabitants in Bogotá. However, when looking at the rural area, this becomes 1 to 1,000 (36).

Target Value

The national average of the population covered by the social security system is expected to reach 99% by 2030 (26).

> Cardiovascular mortality rate is expected to reach 75 out of 100,000 people between 30 and 70 years in 2030 (26). > Cancer mortality rate is expected to reach 55.2 out of 100,000 people between 30 and 70 years in 2030 (26). > Diabetes mortality rate is expected to reach 11.5 out of 100,000 people between 30 and 70 years by 2030 (26). > Respiratory disease mortality rate is expected to reach 8.1 out of 100,000 people between 30 and 70 years by 2030 (26).

> By 2022, a proportion of 1.7 doctors per 1,000 inhabitants is expected in rural areas, translating into an increase of 70% (36).

Industry, Innovation and Infrastructure (SDG 9)
9 - Industry, Innovation and Infrastructure

9.5.1 Research and development expenditure as a proportion of GDP

Current Value

> Colombia, as of 2018, invested in I&D 0.24% of its GDP (26).

Target Value

> As for 2030, Colombia expects to invest 0.84% (26).

Secondary SDGs addressed

1 - No Poverty
9 - Industry, Innovation and Infrastructure

Directly impacted stakeholders

People

> Populations in remote communities (+11M), particularly those with no access to healthcare.

Gender inequality and/or marginalization

> 13% of indigenous populations that are not affiliated to the national health system, but also the remaining 87% who can improve the service they receive.

Corporates

> Telemedicine platforms that can offer their services to health entities in charge.

Public sector

> 17.5% of public spending devoted to the health sector could be better targeted.

Indirectly impacted stakeholders

Gender inequality and/or marginalization

> 90% of indigenous territories are located in border departments, with no proximity to large cities (10).

Corporates

> Other related companies, such as pharmaceutical companies, that can expand their audience due to the greater demand served.

Outcome Risks

> The decrease in demand for other services such as transportation, local pharmacies, due to changes in the service.

> The face-to-face demand could be relegated to strictly serious things, increasing morality or illness indicators.

> Increase in energy consumption.

Impact Risks

Execution risk: >There is a lack of equipment, forms and means of communication, and technical platforms required to develop the infrastructure that guarantees connectivity for the implementation. > Training talent in health informatics and strengthening health personnel's capacities and competencies through virtual platforms is vital for the development of this initiative.

Stakeholder participation risk: > There may be patients who do not feel comfortable with the virtual modality, so there would be a lack of education on the functionalities that this modality can bring. > The Government, together with the National Development Plan, must fulfill its digital transformation initiative. > Enough service providers are needed to meet the demand that is needed in all regions.

Drop off risk: > That the conditions provided by this initiative do not satisfy the medical providers' expectations or conditions, who could leave the service.

External risk: > In many remote rural locations, robust and reliable internet connectivity is not available, making implementation still problematic. > Colombian health system should include this service within what is covered by the subsidized regimen.

Unexpected impact risk: > Weather conditions that hinder infrastructure or internet transmission. For example, strong winds or other natural disasters that damage the connection.

Gender inequality and/or marginalization risk: > Distant or remote communities may have difficulty accessing good connectivity and the necessary tools to make telemedicine appointments.

Impact Classification

C—Contribute to Solutions

What

Positive and important outcome due to improved health coverage.

Risk

Underserved stakeholders living in remote areas with little or no access to health services.

Impact Thesis

This initiative intends to provide medicine to underserved communities as a remote medical service to prevent treatable diseases.

Enabling Environment

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Policy Environment

(National Development Plan): Improve population's health, guaranteeing high-quality standards and user satisfaction by supporting the implementation of telehealth projects aimed at remote populations and comprehensive treatment healthcare models (19).

(Ten-year Public Health Plan 2012-2021): Seeks to achieve zero tolerance for preventable morbidity, mortality, and disability. The latter refers to health services and the technology necessary for the damage to be preventable (33).

(National Rural Health Plan): Aims to close the gaps in health services between urban and rural areas with a gender focus, prioritization of childhood and old age, social inclusion with people with disabilities, and ethnic focus, among others (34).

Financial Environment

Financial incentives: Colciencias launches multiple calls to finance innovation projects to strengthen the health sector through the generation, adaptation, and use of new technologies (23). Funds such as Ewa Capital have invested in remote platforms for health services such as 1DOC3 (4).

Fiscal incentives: Article 9 of Law 100 of 1993 establishes that the resources of social security institutions in health may not be allocated or used for purposes other than it. The resources of the social security system in health are parafiscal income because they are contributions that have a specific sector of the population as a taxpayer and are destined for their benefit.

Regulatory Environment

(Law 1955 of 2019): MinSalud must promote the management of the provision of health services, through advances and improvements in connectivity in remote areas of the country, in coordination with the guidelines of MinTIC (e.g., telehealth programs)(20)

(Law 1419 of 2010): aims to develop Telehealth in Colombia, in support of the General Social Security System, under the principles of efficiency, universality, solidarity, integrity, and quality (21).

(Decree 1848 of 2017): establishes a unique qualification system for indigenous EPS, which includes the set of requirements and procedures that determine the administrative, scientific, technical, cultural, and financial conditions, to guarantee access to health services with a differential approach to their affiliates, attending to the socio-cultural and geographical particularities of indigenous peoples.

Marketplace Participants

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Private Sector

Teletropic is a web-access platform that provides telemedicine services. It is a start-up that won the Emprende con Datos competition, a project led by MinTic and RutaN (22). Health-tech funding and start-ups have skyrocketed in LatAm: between 2014 and 2019, the number of health start-ups jumped from 160 to 389 in the region (24). Bive.co is a low-cost annual membership that allows families to access particular health services efficiently (25).

Government

MinSalud published the guidelines for implementing telehealth activities, including care in the modality of telemedicine and tele-orientation in the context of COVID-19 for Health Service Providers.

Multilaterals

UNICEF has adapted and expanded its digital platforms for communication, monitoring, and remote programming. These platforms include virtual learning courses, educational sessions on radio and television, telemedicine services, among others (12).

Target Locations

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References

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    • (1) DNP (2017) – Plan Nacional de Desarrollo (2018 – 2022)
    • (2) CONPES 3918. 2018. Estrategia para la Implementación de los Objetivos de Desarrollo Sostenible en Colombia. Accessed May 22nd 2020
    • (3) Minsalud (2019) – Cifras de aseguramiento en Salud. Accessed May 30th 2020
    • (4) Ewa|Portfolio companies: http://ewa.capital/portfolio/.Accessed February 8th.
    • (5) EMIS (2020) Colombia Pharma & Healthcare sector 2020/2021
    • (6) MinSalud (2016) Mention of excellence by 37 IPS
    • (7) Fortune Business Insights (2019) Telehealth Market Size, Share & Covid-19 Impact Analysis
    • (8) PubMed.gov (2017) Cost-Benefit Analysis of Telemedicine Systems/Units in Greek Remote Areas
    • (9) Private Equity News (2020) Idinvest sells German telemedicine start-up delivering 40% IRR
    • (10) MinSalud (2016) Health Profile of Indigenous People and inequality measurement
    • (11) Global Data System (n.d) 3 Ways Telemedicine Makes Healthcare More Effective and Efficient
    • (12) UNICEF (2020) Update on UNICEF humanitarian action: the 2019 coronavirus disease pandemic
    • (16) Acemi (2013) – Cifras e indicadores sistema de salud. Accessed June 29th 2020
    • (17) Robeznieks (2019) - How telemedicine helped this health system’s patients avoid the ED. Accessed June 29th 2020
    • (18) Teladoc (2019 – Telehealth impressive ROI. Accessed June 20th 2020
    • (19) DNP (2017) – Plan Nacional de Desarrollo (2018 – 2022)
    • (20) Velásquez (2019) – Parámetros para la Telemedicina en Colombia. Accessed June 23rd 2020
    • (21) Ley 1419. 2010. Accessed June 21st 2020
    • (22) Gobierno Digital (2019) - Teletropic, plataforma de acceso web para prestar servicios de telemedicina tropical. Accessed June 22nd 2020
    • (23) Colciencias (2014) - Convocatoria para el fortalecimiento de los nodos de innovación en TIC. Accessed June 15th 2020
    • (24) Cision (2019) - Telemedicine Adoption Grows Strongly in Latin America. Accessed June 10th 2020
    • (25) Bive.co. Accesed June 2020.
    • (26) National Planning Department (2019) - 2030 Agenda in Colombia
    • (27) National Quality of Life Survey - Amazon (2019) DANE
    • (28) National Quality of Life Survey - Caribbean (2019) DANE
    • (29) National Quality of Life Survey - Pacific (2019) DANE
    • (30) Department Development Plan - Amazonas (2019) Gobernacion del Amazonas
    • (31) National Quality of Life Survey - National (2019) DANE
    • (32) MinSalud (2017) Decree 1848 of 2017
    • (33) MinSalud (2012) Ten-year Public Health Plan 2012-2021
    • (34) ConsultorSalud (2020) National Rural Health Plan
    • (35) Opinion y Salud (2019) Law 1943, Financing Law
    • (36) DNP (n.d) Health for Everyone: National Development Plan
    • (37) IADB (2016) Impact of Early Stage Equity Funds in Latin America