Davos Agenda

Health and the fourth industrial revolution

Technician Matthew Smith loads a robotic DNA sample automation machine at a Regeneron Pharmaceuticals Inc. laboratory at the biotechnology company's headquarters in Tarrytown, New York March 24, 2015.

Image: REUTERS/Mike Segar

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Davos Agenda

Healthcare has made huge contributions to the wellbeing and the prosperity of our societies; however the sector is in need of a transformation.

The health systems organized around incentives that reward volumes of procedures as opposed to quality of care have led to unsustainable costs, while outcomes have stayed mediocre at best. The strategy that has begun to transform this trend is value-based care: driven by changes in regulations and payment models that transfer part of the non-quality risks from payers to providers, it aims at achieving the best outcomes for patients at a lower cost.

Value-based care is hardly new. What is new is that after decades when scientific innovation has meant increasing costs for arguably modest improvements in outcome (in the U.S., healthcare spending represented 4.6% of GDP in 1950, compared to 17.5% in 2014), we may have finally reached an inflexion point as the most recent scientific contributions to better care might finally bring down costs.

Just as examples, robotic surgical methods have lead to a reduction in infections of surgical wound - something which kills 4.5% of those afflicted. Additionally, avoiding open surgeries also helps patients recover faster - a report from Allied Market Research suggests that robotic surgeries could reduce hospitalization by 1.5-2 days, which in turns reduces costs.

In the fields of genomics testing, or advanced radiological imaging, more precise diagnoses and treatments will become available. Because technologies like genomics enable a clinical approach vastly different from the blind sequential one where you try, fail, try something else until you succeed, these technologies also hold the promise of preventing waste and spillage of scarce resources, and undoubtedly improving outcomes overall.

Another example lies in the way clinical data analytics allows for faster, better clinical decision-making. From triaging patients in the emergency room based on comparing a patient’s CT scan to large databases of previously known cases, to the reduction of discrepancies of care as protocols as defined by reviewing millions of similar cases, big data analysis will mean doctors have a unique set of tools to reduce medical errors and benefit from the latest scientific knowledge. Even as they evolve in their practice and their clinical education starts dating.

The real-word examples of these trends are increasing. Early in November of 2015, an experimental treatment that uses “molecular scissors” to edit genes and create designer immune cells programmed to hunt out and kill drug resistant leukaemia was used at Great Ormond Street Hospital in the UK. The treatment, previously only tested in the laboratory, was used in one-year-old, Layla Richards, who had relapsed acute lymphoblastic leukaemia. She is now cancer free and doing well. Think about a world where science would repair the causes of diseases as opposed to reducing the effects of symptoms. Think about a world where cell regeneration science would help diabetes or renal failure patients enjoy disease-free lives as they benefit from early transplants of artificial pancreas and kidney.

These are the promises of the fourth industrial revolution when it comes to healthcare.

When this happens, costs will be contained because waste will be eliminated and only relevant treatments will be prescribed. Innovation will then finally become the instrument to value-based healthcare, as long as it is true that regulatory pathways evolve at the speed science does, and as long we can define in full transparency new mechanisms to price the new cure.

Now what about additionally containing costs by helping individuals stay healthy in the first place? Less waste in healthcare could in turn unlock precious resources to be better invested in population health.

Creating healthy living ecosystems, designing cities to promote mobility, nurturing healthy diets and encouraging people to take charge of their own health will all play a role. At the same time we need to create the mechanisms for populations to react faster and better to large healthcare catastrophic risks. These two pillars of the World Economic Forum’s Global Challenge on the Future of Health will be on the agenda at Davos. There as well, from behavioural science to digital engagement in communities, to advanced detection of emerging risks enabled by big data, the technologies emerging from the fourth industrial revolution will play an immense role in building the future of healthcare.

Author: Arnaud Bernaert, Head of Global Health and Healthcare Industries, Member of the Executive Committee at World Economic Forum Geneva. He is participating in the World Economic Forum’s Annual Meeting in Davos.

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