The Japanese government aims at implementing structural and systemic reforms to address a shortage of qualified healthcare workers, imbalance between cities and rural areas regarding healthcare access and service providers, and exploding costs that threaten the national health insurance system. Innovation is encouraged and supported, and major priorities have been identified: the effective use of Big Data analytics; a general drive to improve patient outcomes for cost-saving purposes; the launch of the Personal Health Record.
To reach those goals, legal changes allowing the use of smartphones as medical devices, and telemedicine in general were recently implemented, creating the necessary space for innovative solutions.
Market value and characteristics
Analyses show that the use of IT products and related services in the healthcare industry should grow at least 2.3 times by 2030 (compared to 2013). Among other valuable sub-segments, the market of IoT-related equipment and systems in the medical field (valued at 753 million USD in 2016) should reach 1.685 billion USD in 2025. The AI-related products and services market – that includes Big Data analysis -- (valued at 37 million USD in 2016) is expected to reach 134 million USD in 2025.
The Japanese Healthcare Tech market is defined by two contradictory facts: on the one hand, a lagging ICT infrastructure in hospitals and clinics, as well as poor IT literacy among decision-makers and healthcare providers; on the other hand, a high-level penetration rate of smartphones, wearable devices and connection to high-speed internet of the general population (81.7%).
Combined to a pressing need to tackle costs and improve efficiency, these two features generate attractive business opportunities for exporters able to offer disruptive solutions.
Market issues and needs
Three main clusters regrouping different market issues and needs can be identified. The following are only a few examples of attractive opportunities for exporters.
Patients: new diseases created by aging, but also a change of lifestyle, demand the introduction of IoT and/or robotics solutions at home, wearable devices and technologies that help to manage chronic diseases, as well as prevent their onset. Patient awareness must be increased through better access to information and improvement of health literacy.
Medical professionals: solutions such as telemedicine, remote image diagnosis and affordable devices to conduct telepathology are needed to compensate the chronic lack of medical specialists in rural areas. Watch service devices, communication tools for isolated patients, wireless medical prescriptions are in demand due to rising needs in the field of home nursing care.
Introduction of Big Data to improve care management and conduct predictive analysis as well as genomics are required to provide better care and preventive treatment. Cloud computing solutions should be implemented to improve inter-professional collaboration and efficiency, within and between hospitals.
Hospital administrators: administrators are faced with a wide range of issues, such as poor knowledge and skills regarding securing comprehensive healthcare data, a lack of coordination within and outside institutions due to poor system interoperability and communication, lack of efficiency and excessive costs due to both low digitization and digitalization, or poor stock management of supplies and devices. All of them are compounded by a lack of IT literacy at management level.
Solutions that can guarantee patient data security and privacy, tools using Big Data, collaborative tools, claim and human resource management tools, but also IT training programs for the medical field are needed.
Competition and market fragmentation
The opportunities and pressing needs of this booming market are already recognized by major domestic actors, in particular non-life science players in the telecom or electronics industries, such as NTT, DoCoMo, Canon or IBM Japan. Large general trading houses like Mitsubishi Corp. are developing new and dedicated business strategies in this field.
Despite the presence of those major companies, in 2017, the competitive environment was fragmented, with smaller players accounting for a large share of the total sales. Targeting niche markets, with products and services catering to the individual demands of consumers seems to be a key point for a successful market entry.
Swiss companies enjoy an excellent image and reputation in Japan, and their know-how is valued, in the health and data security sectors in particular. They apply some of the highest standards in the fields of information and data security, as well as privacy.
Their areas of strengths are a perfect match for the Japanese areas of needs: tracking and monitoring of patients (using apps and devices), Big Data and associated data-driven insights), chronic care management apps as well as devices and AI solutions are among solutions that Swiss companies can bring to Japan.
Advices to exporters
On top of the language barrier and business culture differences, exporters face several challenges such as overlapping regulations and authorities, a fragmented hospital network, a slow approval process, or a complex multi-tier distribution system. Such hurdles can be overcome by establishing first a partnership with local actors familiar with those processes, benefiting from an existing network, and eager to introduce new technologies to the market.
Would you like to learn more?
Swiss Business Hub Japan and its Healthcare Tech experts will gladly assist you in opening doors. Sign-up for an individual and closed meeting with a SBH Japan trade officer during the next country consultation days or contact Jacqueline Tschumi, our consultant for Japan, to arrange a free consultation meeting. Contact now