Boston’s status as a global health innovation center attracts major biotech corporations who purchase Kendall Square real estate priced at soaring heights and exceeded only by shareholder value. Rather than look for global opportunities, most companies focus on the large and profitable U.S. health market where they can extract value from decades of research and development. Healthcare is a very risky business, even in well developed markets like the U.S.’s. Given the many risks associated with doing business domestically, much less internationally, why would anyone try to focus on global health markets?
“Investors should understand that many international health markets are growing at double digit rates and there will be significant first mover advantages in a number of sectors,” says Alden Zecha, CFO and Strategist of Sproxil, a venture capital-backed company based in Cambridge.
Sproxil provides a consumer SMS and application verification service which helps consumers avoid purchasing counterfeit products like medicine at village pharmacies in developing countries. The cloud-based technology platform can work with basic inputs like text messages or more sophisticated ones like mobile apps, allowing Sproxil to serve different markets simultaneously.
“There are many good [global] investment opportunities,” says Zecha. “That said, exits may not be as easy to achieve and there are often significant operational difficulties working with remote markets. The American health care market is in flux though, given uncertainties regarding future policies. Thus an investor who is willing to accept a higher risk may well find superior returns in international markets.”
Despite these risks, Sproxil isn’t the only Boston-based company entering global markets. Other early-stage businesses with international aims have begun experiencing significant traction.
“We are entering the global market for infection control,” says Dr. Adrian Gropper, one of the nation’s foremost open data experts and ProxoMe team member. “There are big obstacles in the diversity of regulatory and procurement processes and the high costs of testing in distant and resource-poor areas.”
Despite these obstacles, the group — which along with Gropper consists of several Boston University School of Public Health students and leading MGH clinicians — has already seen much success: financial and in-kind support from large global medicine device vendor Medtronic as well as administrative and market research support from Global Medical Corps and CAMTech at Massachusetts General Hospital.
Jana Care, a Newton based company, developed a mobile app solution focusing on diabetes management in India. Cambridge based Dimagi offers open-source software targeted at low-resource settings and underserved communities. It performs patient-level disease management, clinical decision support and health system monitoring. Daktari Diagnostics, also based in Cambridge, developed a diagnostic test recently raising a $15.5 million round. Their product screens and monitors patients with diseases such as HIV and sickle cell disease and was awarded an NIH SBIR Phase II grant for its Hepatitis C diagnostic.
The Consortium for Affordable Medical Technologies (CAMTech) sponsored the Global Health track at this year’s MIT Hacking Medicine Grand Hack. CAMTech’s mission is to accelerate medical technology innovation and build entrepreneurial capacity to improve health outcomes in low and middle-income countries.
“One of the things we are doing is trying to de-risk early stage ventures so they are more attractive to early stage investors,” says Elizabeth Bailey, director of CAMTech. “It doesn’t take a lot of funding to do that. What’s missing beyond the funding is the technical assistance.”
That technical assistance can easily be found in Boston. A leading life sciences cluster, the city is a global hub, home to the best and brightest researchers and clinicians. But paradoxically, some originate from places where the standards of medical care are suboptimal. More often than not, living conditions include major widespread infectious disease and lack of access to basic necessities.
I’ve traveled to the Delhi region of India where the things I saw — like people bathing in public with sewer water — shocked me. Despite these widespread and commonplace conditions, even the poorest child street beggars knew of Harvard and MIT. Along with making me feel like I was taking everything that I have for granted, the experience also made me realize what a huge influence our city has on the rest of the world.
It was then that I made the connection between our bright minds in Boston with the needs of the people I met in Delhi. While some companies are clamoring to invent the competitor to the Apple Watch, others have identified relatively basic technical solutions using business models that have allowed them to be profitable while carrying out a humanitarian mission.
Do you know of any great medical technology startups focusing on underserved global markets that I missed? Let me know at firstname.lastname@example.org.
Robert Schultz has an MBA in Information Systems from University of Massachusetts-Boston and a BS in International Business from Northeastern University, where he served as Business Manager for the university’s largest student publication, The Northeastern News. Schultz is an experienced healthcare technology startup enthusiast who was involved with the patient monitoring company Aware Engineering through the MassBio MassCONNECT program.
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