Guest post by Daniel Wei, a 2019 MBA Summer Intern at AWS
The amount of healthcare data globally is increasing at a rapid scale. Germany, to date, has missed much of this revolution and lags behind other countries with regard to electronic health records and e-prescriptions. But the country is finally starting to open up. To ensure the country is not further hampered by a lack of digitization experience, providers, payers, patients, pharma companies, and startups should look to cloud computing technology to help bridge the gap.
The healthcare and life science industry globally is finally waking up to the potential of digitization in light of rapidly rising healthcare expenditure, approaching $10 trillion by 2022. The U.S. alone generates one trillion gigabytes of healthcare data annually. In healthcare, providers are offering telemedicine and e-prescriptions to improve the patient experience, to enhance data traceability, and to save unnecessary administrative costs. In the life sciences, pharmaceutical and biotech companies are exploring digital solutions to optimize their drug development process, e.g. by using machine learning and real-world evidence to identify interactions between different drug compounds and patient populations.
Germany is waking up: While other European countries have already adopted new technologies including the electronic health record (e.g. Austria), e-prescriptions (e.g. Nordics, Estonia), and voice technology (e.g. UK), Germany has remained on the sidelines for many years, relying on paper solutions to capture patient data and organize workflows. Consequently, frustrated physicians and researchers have often chosen to leave the country, causing German-borne innovations to commercialize elsewhere (e.g. Morphosys, AiCuris). Finally, the Federal Ministry of Health has started taking action by aiming to pass 16 new legislations involving digital healthcare through parliament by the end of 2019. Most importantly, the Digital Provision Act will enable telemedicine, e-prescriptions, and reimbursement of digital health solutions such as apps and wearables. According to a report published by McKinsey, the rollout of these technologies has the potential to save up to $38B in Germany, representing 12% of total healthcare expenditure.
Startups are leading this charge toward digitalization, but they are facing headwinds. Many see digital health, biotech, and medtech startups as the key drivers to realize this potential; they were fueled by rising venture funding volumes of over €600M in Germany alone in 2018—a 50% increase vs. 2017. Yet, these startups are facing challenges that are preventing them from achieving their full potential. Through interviewing 20 key stakeholders in the healthcare and life science sector including startups, investors, consultants and regulators, we have boiled it down to three concrete challenges:
- High research costs and duration: As diseases become increasingly complex, it can cost several billions of dollars and take up to a decade to bring a drug to market. Most startups we spoke to are aware of the potential of machine learning to cut biopharma R&D by up to 25% and accelerate time to market, but few know how to implement the digital transformation journey required.
- Digital skill gap among founders: Digital expertise across founders differs significantly. In our conversations, we found digital health startup founders to be more prone to experiment with new technologies including big data analysis, voice technology, and cloud computing compared to biotech and medtech founders.
- Poor technology integration: Most startups we interviewed rely on external software vendors to handle core processes including preclinical research or compliance reporting. These vendors are highly specialized and lack standardization and data integration across platforms, causing inefficiencies and duplication of work.
Cloud computing to bridge the gap
Through our experience working with healthcare and life science customers globally with 80+ public case studies, AWS can support healthcare and life science startups overcome these challenges through cloud technology. Concretely, we have identified three ways we can help, backed by reference cases.
- Offer tailored solutions: A key reason why it is more difficult to apply big data analysis and machine learning to healthcare and life sciences is that we still lack understanding for the cause and effects of many diseases such as cancer or dementia. Unlike other industries where we can simply take a standard machine learning product such as Amazon SageMaker, feed it with data, and let it make predictions, algorithms in healthcare and life sciences need to be more tailored to the complexity of clinical data. In the US, AWS has collaborated with leading technology providers such as Illumina to help genomic researchers accelerate time-to-discovery through running its BaseSpace Sequence Hub platform on AWS. With other technology partners including ChemAxon and Benchling, we have developed the AWS Biotech Blueprints to help customers build a preclinical, cloud-based infrastructure with a few clicks.
- Provide training and education: It is not surprising to us that healthcare and life science is among the most skeptical industries when it comes to adopting digital technologies. After all, startups operating in this sector deal with sensitive patient data and are subject to high regulatory scrutiny. Yet, as new regulations are being drafted in Germany providing more clarity around compliance and security-related matters when dealing with patient data, we encourage healthcare and life science startups to seize the opportunity and upgrade their digital capabilities. To help startups identify the best approach customized to their needs, AWS hosts dedicated training sessions called Immersion Days for individual customers, showcasing specific use cases based on examples with other customers. For instance, we recently hosted an Immersion Day for a German digital health startup to dive deep on cloud use cases in telemedicine, covering topics from regulations to the potential of blockchain.
- Bring together different stakeholders: The healthcare and life science sector has the tendency to form silos amongst providers, payers, and pharma to respect data protection and compliance regulations. Yet, we can only master digital transformation if all stakeholders work together, with patients in the center and startups in the lead to develop innovative technologies catering to their needs. At AWS, we aim to be the bridge-builder between these stakeholders by hosting relevant events such as industry roundtables, startup pitches, and joint prototyping sessions. Through our Startup Activate Program, we offer startups access to our exclusive network of leading VC investors, research institutes, and pharma companies amidst many other benefits including up to $100,000 in AWS credits and dedicated support from our solution architects and marketing professionals.
In case you are interested in learning more, please contact our sales team under https://aws.amazon.com/de/contact-us/aws-sales/ or stay tuned for more updates in healthcare and life sciences by frequently visiting this blog!
 See Deloitte, “2019 Global Health Care Outlook”
 See Travis May, “The fragmentation of health data,” Medium, July 31, 2018, medium.com.
 See McKinsey, “Digitalisierung im Gesundheitswesen: die Chancen für Deutschland“
 Source: Crunchbase