The transition of public health from the NHS to local government could see the loss of a third of its current leaders.

The Asssociation of Directors of Public Health anticipates that up to 60 of its members will not find roles in the new structure.

Janet Atherton, President of the ADPH, said the transition posed “real concerns and high risk to local public health”.

Of 77 respondents to the Association’s survey of directors, only 28 were confident that funding for the new public health service was adequate.

The Association commented that public health in England faces a “significant loss of local public health leadership” with a consequent risk to outcomes.

The survey reported “uncertainty” about the imminent transition: neither the organisational structure nor the terms and conditions have been finalised.

This survey and a previous one in November 2011 led the ADPH to predict that only two-thirds of current public health directors will continue in similar roles within local authorities.

Only 28 respondents said the funding baseline for public health was adequate, with 25 saying it was not, 21 ‘unsure’ and three not replying.

Among the concerns expressed were funding shortfalls affecting sexual health, obesity prevention and treatment for alcoholism and smoking.

The NHS will receive an immediate cash injection of up to £100m to support local community-based services during the winter months.

The additional ‘frontline commissioning funding’, which has been allocated to the emerging Clinical Commissioning Groups (CCGs), must be committed for specific purposes by mid-February or returned to the DH.

The money, amounting to £2 per patient, is to be spent on developing local care services and reducing unnecessary hospital admissions; as such, its remit may include prescribing.

While it may soften the immediate frontline impact of cuts in NHS spending, the new cash injection is only 2% of the £5bn ‘efficiency savings’ required of the NHS in 2012.

Consistent with the DH policy of shifting the focus of healthcare from acute to community-based services, the funding could (for example) be spent on improving patient access to GP services, improving services provided to nursing homes, or developing home-based services.

Health Secretary Andrew Lansley said: “I am pleased to be able to give the NHS up to £100 million in extra funding to spend directly on local frontline care for their patients during the winter months.”

He emphasised that giving a cash boost to the new CCGs would strengthen the role of local clinicians and thereby ensure that patients “receive the right care according to their individual needs”.

The money must be signed off by the PCT clusters for specific service improvement purposes: it cannot be used to help cover the cost of existing services.

This is the first time that the DH has specifically identified funding to be allocated to the new CCGs, though PCTs already delegate commissioning funds to support the CCGs in providing services.

CCGs will need to inform their PCT clusters how the funding will be utilised by mid-February 2012; each PCT cluster will similarly need to inform the relevant SHA cluster by the end of February 2012, and money not allocated will be returned to the DH.

This funding window provides an added incentive for pharmaceutical companies to demonstrate the value of their solutions for community-based healthcare.

New research shows that SME growth provides the best prospect for economic recovery in the UK. But, as private equity firm ECI notes, finding the cash to reach out to global partners and markets can be a critical hurdle.

With continued pressure on governments across the Western world to reduce their expenditure, together with sustained macro-economic uncertainty and a tightening of bank funding, times are not necessarily easy for the average healthcare company – which often relies on the public purse for reimbursement and debt funding for growth. One might therefore expect the short-term outlook for growth to be somewhat muted, despite the backdrop of positive longer-term demographic drivers of demand.

Hence it is interesting that a recent survey of UK SME businesses by ECI Partners, a UK-based midmarket private equity firm, has found executives to be generally positive about growth prospects over the next 12 months, with 74% of respondents anticipating headcount growth and 60% expecting double-digit turnover growth.

The results met with a warm response from the Government, with Mark Prisk, Minister of State for Business and Enterprise, saying: “It’s good news that despite a tough few months, nearly three-quarters of the SMEs surveyed by ECI are looking to recruit over the next year and half expect to see substantial profit growth in that period. Up and down the country, it is Britain’s SMEs that are driving our economic recovery.”

Reaching out

This year, the survey conducted each summer by ECI Partners gained responses from a total of 246 chief executives from UK growth companies from a range of sectors with turnover between £10m and £200m. The results paint a positive picture against the gloomy economic backdrop of the Eurozone crisis and sluggish UK economy, and suggest that there remains growth potential amongst SME businesses – which account for around a third of UK private sector employment.

Steve Tudge, a Managing Director of ECI, commented: “Despite the barriers to growth, which are principally cited as a weaker macro-environment and funding constraints, we continue to be optimistic about the prospects for good mid-market companies.”

Executives see the key growth drivers to be increasing international sales – with Europe and the USA remaining the dominant international markets, though India and China are becoming more important – and organic growth through investment in sales and marketing and new product development. Over 40% of companies are also planning to increase their use of overseas suppliers to improve their margins.

Internal cash flows are viewed as the most likely source of funding for this growth, though around half of respondents say they are likely to seek bank debt within the next 12 months (despite continued complaints about its cost and due diligence requirements) and around 40% are also likely to look at private equity backing. Fewer than 10% of companies see the public markets as accessible, perhaps reflecting the recent volatility and liquidity issues associated with the AIM market.

Healthcare respondents are less bullish about high growth than their peers in other sectors, and are noticeably less positive about growth than they were last year. This no doubt reflects, in part, the political uncertainty surrounding the current UK healthcare reforms and the public sector spending constraints that are impacting on the health and social care sectors.

Despite this, companies remain more confident of raising growth financing – and of raising it from private equity firms, with over 50% saying that was a likely consideration over the next year.

Financing growth

What does all this mean for SME healthcare businesses in the UK? The sector certainly faces challenges in responding to Government spending cuts, which are tending to put pressure on margins if not always on volumes.

However, opportunities for growth remain amidst these challenges, particularly for companies who are able and willing to venture beyond the UK in order to seek new customers and cheaper suppliers.

Of course, this internationalisation can put a strain on smaller businesses, which may lack the scale to fully support an international infrastructure. Private equity groups with experience and expertise in this process can potentially offer support to management teams in this position – whether by making introductions, sharing best practice or simply financing the required infrastructure.

There are significant sums of capital available for investment from the UK private equity industry, and there remains an appetite to invest in market-leading healthcare businesses. Thus private equity should be considered seriously as an option by management teams in the healthcare industry who are looking to fund growth to help their companies succeed in the current economic environment.

ECI is a private equity group that has been investing in mid-market growth businesses for over 35 years. It invests across sectors, with a focus on UK and Irish companies. Healthcare companies in its current portfolio include a primary care provider (Harmoni), assisted living specialists (Premier Bathrooms, DLP) and medical software companies (Clinisys, Ascribe).

New funding for medical technology research by companies, clinicians and academics aims to promote innovative approaches to the prevention, diagnosis and treatment of diseases in the NHS.

The National Institute for Health Research (NIHR) Invention for Innovation (i4i) programme has allocated up to £13m for research projects, and has launched a call for proposals.

The NIHR i4i programme funds projects through prototype and commercial development until a technology is ready for clinical testing, bringing together academic or clinical researchers and technical experts from industry.

The programme has been updated in two ways:

• Research projects in Wales, as well as in England, are now eligible for i4i.
• Instead of being divided between early- and late-stage product development awards, applications will all be submitted through a single route.

As well as looking for technologies that will benefit NHS patients, the NIHR i4i programme supports collaboration between researchers in industry, the NHS and the academic field. Each approved proposal will bring together researchers from at least two of these sectors.

NIHR particularly welcomes proposals from SMEs and from teams that have previously succeeded in developing and commercialising new technologies.

Martin Hunt, NIHR i4i Programme Director, said: “In the present economic climate, it is becoming increasingly difficult for medtech companies to secure funding for new, innovative technologies. The NIHR i4i programme provides a valuable funding opportunity for the medtech sector.”

This year’s i4i funding covers a “much broader” range of projects than last year’s, he noted. “The amount of funding awarded is determined by the nature and scale of the proposed research activity and we are considering projects seeking larger funding amounts than before.”

Outline research proposals must be submitted by 5pm on Wednesday 7 December 2011. Further details are available at www.i4i.nihr.ac.uk.

The only solution to the NHS funding crisis is to reduce the amount of beds and hospital-based jobs, says NHS Confederation head Mike Farrar.

The NHS Confed Chief Executive said in an article with the Guardian that shifting healthcare services into the community and centralising surgery provision is the only way to avoid wholesale loss of NHS service provision.

Mr Farrar says that “radically re-orienting services to reduce hospital stays and offering new forms of care” will help the NHS improve and keep it financially stable.

He noted that the Government’s £20 billion efficiency savings target by 2015 was already increasing NHS waiting times and raising the threat of the health service cutting services to “salami slice its way out of financial trouble”.

Farrar also said that there was a danger of the NHS reducing access to “less effective treatments”, though in fact this is already taking place in most Trusts.

To avoid financial disaster on the one hand or disastrous loss of services on the other, he argued, the only way forward is to shift the focus of services into the community – and immediately utilise the benefits of service redesign by closing down much of the existing in-patient hospital provision.

Surgery can be relocated to major centres and out-patient services to primary and home-based care, he said, with hospitals ceasing to be the main providers of secondary care.

His stark message is that without this reconfiguration of services – which will only be possible if funding is made available for service redesign – healthcare in the UK “faces a bleak future”.

The only solution to the NHS funding crisis is “radically re-orienting services to reduce hospital stays and offering new forms of care,” according to NHS Confederation head Mike Farrar (pictured).

Farrar, a long-term supporter of medtech innovation as a facilitator of NHS service redesign, has said in a Guardian article that shifting healthcare services into the community and centralising surgery provision is the only way to avoid wholesale loss of NHS service provision.

He noted that the imperative of achieving £20 billion of savings by 2015 was already increasing NHS waiting times and raising the threat of the health service cutting services to “salami slice its way out of financial trouble”.

Farrar also said that there was a danger of the NHS reducing access to “less effective treatments”, though in fact this is already taking place in most Trusts.

To avoid financial disaster on the one hand or disastrous loss of services on the other, he argued, the only way forward is to shift the focus of services into the community – and immediately to cash in on the benefits of service redesign by closing down much of the existing in-patient hospital provision.

Surgery can be relocated to major centres and out-patient services to primary and home-based care, he said, with hospitals ceasing to be the main providers of secondary care.

Farrar’s argument echoes the emphasis of Lord Darzi’s NHS Review (2008), but with the crucial further twist of a serious funding crisis.

His stark message is that without this reconfiguration of services – which will only be possible if funding is made available for service redesign – healthcare in the UK “faces a bleak future”.

The medtech industry has argued for years that the use of new technologies to shift more diagnosis, monitoring and treatment into the community is essential to the future of the NHS. Now, a leading NHS figure has said there is no other option.

The UK Government has committed £800 million funding to boost translational research focused on healthcare innovation.

The record investment in early-stage medical research will focus on areas of unmet need, including the prevention and treatment of cardiovascular disease, obesity and dementia.

The National Institute for Health Research (NIHR) will use the £800 million over five years to develop NHS and university partnerships called Biomedical Research Units (BRUs), which will collaborate with industry and health charities.

The NIHR BRUs will aim to carry out translational research in seven priority areas of clinical need: cardiovascular disease; deafness and hearing problems; dementia; gastrointestinal disease; musculoskeletal disease; nutrition, diet and lifestyle; and respiratory disease.

Health Secretary Andrew Lansley commented: “We need to give British scientists the means and tools to develop groundbreaking world-class health research. That’s why we have committed £800 million for translational research – developing exciting new science into tangible, effective treatments that can be used across the NHS.

“This record investment will secure the NHS as a world leader in translational research, as well as helping to ensure we give patients the very best treatment possible.”

“The NHS in England has become one of the best environments in the world for undertaking cutting edge translational research,” said Sir John Bell, President of the Academy of Medical Sciences. “This is creating real opportunities for improving the health of patients, as well as positioning the UK as a preferred site for clinical development by the [life science] industries.”

A new proof of concept competition will make £15,000 available to each of two companies developing new medical technologies that address unmet patient needs.

Devices for Dignity (D4D), a national NHS programme, is looking to advance the development of an innovative product or service in two areas of healthcare: assistive technologies and renal technologies.

The winning technologies will help to meet clinical needs in ways that support D4D’s aim of improving the care and dignity of people with long-term conditions.

The competition is open to UK companies, healthcare professionals, academics and inventors, as well as patients and carers.

One winner per theme will be awarded £15,000 and be given the opportunity to work with D4D’s network of business experts and specialist clinicians, helping them to secure grant funding and early-stage investment.

Professor Wendy Tindale, Clinical Director of D4D, said: “This is a fantastic opportunity for medical technology innovators because it is a huge step towards turning an idea into something concrete.”

Details of the competition are available at: www.devicesfordignity.org.uk/ucnc

D4D is a national programme, hosted by Sheffield Teaching Hospitals NHS Foundation Trust, working with healthcare companies, clinicians, academics and other stakeholders to develop solutions in assistive technologies, urinary continence management and renal technologies.

It is supported by the National Institute for Health Research, the Technology Strategy Board, the Engineering and Physical Sciences Research Council and the Medical Research Council.

Eight companies have been chosen to receive up to £100,000 funding each to help them develop medical technologies to support people with long-term health conditions.

The East of England Small Business Research Initiative (SBRI East) is investing in medical innovations that address the needs of the growing number of chronically ill patients by reducing acute admissions and delivering care in the community.

Of the 70 companies that applied for SBRI East funding this year, the eight selected are:

• Advanced Therapeutic Materials (Warwickshire) for its technology for long-term management of venous ulcers and circulatory failure. Data from a 3D imaging device is used to design customised compression garments.

• Aseptika (Huntingdon) for its rapid, home-based test for bacterial respiratory infections in patients with cystic fibrosis.

• Edixomed (Edinburgh) for its dressing for chronic diabetic leg ulcers. The system delivers nitric oxide directly to the wound, increasing blood flow.

• Sky Medical Technology (Cheshire) for its disposable adhesive device for self-treatment of an overactive bladder by external neuromuscular stimulation.

• Pintrack (Essex) for its Outminder independent living solution, which offers the user support as well as enabling the carer to deliver support remotely via a mobile device.

• PneumaCare (Cambridgeshire) for its non-contact respiratory assessment system, which can diagnose deterioration in patients with COPD.

• PolyPhotonix (Sedgefield) for its home-based treatment for diabetic retinopathy and AMD.

• Radisens Diagnostics (Cork, Ireland) to add a kidney disease test to its point-of-care blood analyser platform, which diagnoses and monitors various chronic conditions.

Karen Livingstone, Director of Strategic Partnerships at NHS East of England, said: “It is heartening to see British companies seeking to develop healthcare technologies to benefit those living with long-term conditions. These new technologies will mean that in the future, more people will be able to receive treatment in their own homes. This not only makes for an improved patient experience but also saves healthcare resources and costs.”

SBRI East is supported by NHS East of England, the European Regional Development Fund and the Technology Strategy Board.

The Government has denied claims that deprived areas of England will lose out to affluent locations under NHS reforms.

The accusations come from Labour, highlighting figures suggesting that funding changes to primary care trusts will result in Manchester suffering cuts of £42million and Liverpool losing £33million.

This was contrasted with Surrey, who will receive an extra £61million, and Hampshire set to receive an increase of £52million.

Health Secretary Andrew Lansley rejected these claims, stating “We’re not taking money away from any parts of England, we’re increasing the budget for the health service in England.

“The average increase in each PCT is 3% compared to the provision the previous year. The minimum increase is 2.5%.”

Shadow Health Secretary John Healey said that the figures reveal that the Tories’ NHS plans will make inequality worse, not better: “The plans will hit services that help people stop smoking, promote healthy eating and exercise and raise awareness about the risks of sexually transmitted diseases.”

The Government stated that the funding changes were based on independent advice and that Labour's figures are misleading.

The DH said that a greater emphasis on the prevention of illness would assist those living in poorer parts of England in the future.