Fredrik Gyllenram, General Manager, International Strategic Accounts at Philips Healthcare, explains how the medical technologies industry can meet the challenges of global healthcare by bundling its products into ground-breaking solutions, and working in partnership with other companies that have complementary technologies.
Fredrik Gyllenram was in the UK to announce the agreement between Philips Healthcare and the IBA Group, a leader in advanced cancer diagnosis and treatment, to develop a series of patient-centric proton therapy centres worldwide. Medtech Business talked to Mr Gyllenram about his company’s commercial strategy in a time of growing demand and shrinking budgets for healthcare.
How would you define your role? Who are your customers?
I run global account management for healthcare outside the US. That means I engage with large corporations, international customers, who go beyond geographies. And my team also works with the World Bank, the multilateral development banks, the bilateral institutions such as the Nordic Investment Bank. So we basically address any business and any client that reaches beyond natural geographical boundaries, and any department that expands outside or has business interests across those boundaries.
Do your customers fall into groups?
Yes, they do. You can see the large private hospital chains as one group, and international venturers and start-ups who have an ambition to enter into segments globally as another group in the private sector. You also have relationships with major financial institutions as I have mentioned. So it’s a cluster of customers and financial customers, as well as financial enablers, that we work with. In that context we work also with large hospital supplier companies and hospital integrator companies, so we have a pretty broad span internationally.
How has your customer base evolved in recent years?
We see a couple of drivers. We see international hospital chains reaching out; but at the same time we see their expertise being in demand in emerging markets in developing health economies, so they also see business opportunities reaching out to them. We also see tremendous growth in demand for healthcare, so the role of the World Bank, the African Nation Development Bank, the European foundations and so on is increasingly important. In general we see the market for healthcare increasing, not only in financial terms but also from an expertise point of view: the scarcity is not only in money, it’s also in IT and other resources and competencies.
How have the challenges facing the global health economy affected the interaction between Philips and its customers?
I think it has been a mutually beneficial experience – and that is true not only for global account management but for the whole company. Philips has taken a major turn of direction over the past 10 years. Healthcare used to be a minor part of what was a many-faceted conglomerate. Over the past 10 years the company has divested some of its original businesses and focused on its ambition to be a global leader in health and wellbeing. Healthcare has gone from being 5–6% of the company to being more than one third, and a very strong focus for the whole company.
What are the biggest challenges facing your customers? What kind of solutions are they looking for?
I think it would be too bold for me to be very explicit, but I think the challenges of healthcare in general are well understood. We see a quite uneven pattern of healthcare across the world, with the US responsible for more than 50% of healthcare spending worldwide; we see tremendous growth in demand for healthcare with the development of the middle class in emerging countries; and at the same time we see an increased demand for quality of care and outcome-based medicine.
Another factor, of course, is the ageing population: we live longer despite inducing more disease through our lifestyle; and we may live longer still in the future despite our impaired lifestyle, because healthcare today is quite successful in treating some diseases that previously would have killed you, such as stroke and cancer. So we will see an older population that is not fully healthy and will require even more healthcare, and thus the global economy faces some significant challenges.
In addition, there will be a significant scarcity of qualified healthcare providers in all categories, from nurses and home healthcare to specialists. So it is an interesting equation, and it is on these fundamentals that Philips has drastically changed its strategy and its way of moving forward.
What do customers need now to be convinced to buy a technology?
I think the discussion about technology is perhaps secondary. What currently should be on the radar screen is how a technology is enabling. It needs not only to address a defined technology question, but also to fit in the continuum of care. Treatment today is becoming more and more multi-disciplinary. As a supplier you interact with a number of care-givers of various disciplines in treating and curing patients. So what we look for is both a partner and a technology that can reach out and provide the kind of information the technology can generate throughout those different kinds of previously siloed institutions. For example, information and images need not only to go to the radiology department, they need to reach out to the researchers, to the people involved in rehab, to the cardiologists. The whole panorama of people involved in treating patients is growing extensively.
Also, if you think about costs, you need to have systems that can go beyond the acute scene in the high-cost intensive care unit or emergency department. You definitely need to consider how the information can be used, and be able to provide that information to more local systems such as aftercare, geriatric care or home healthcare. Those are things that are very much in our minds.
We would like to play a role of looking primarily at the role technology plays through the care paradigm or the care pathway of the patient. In our language we call that a care cycle. You have to understand, at all levels from a major healthcare economy such as the UK all the way down to the local department and clinician, what we in the industry can provide through the care cycle in a sensible, high-quality and cost-efficient way. So instead of just looking at your kit and your little system in that department, you need to understand how that interacts with the whole picture and why the health system should use it to make the care cycle more efficient and predictable with better outcomes.
So we concentrate a lot on the role our products play across the spectrum of prevention, diagnosis, rehabilitation and cure. We do that in cardiology, oncology and women’s healthcare, which are our three focus disease areas. So we’re turning away from technology as such towards a care cycle approach.
How important are partnerships with other medical technology companies to Philips Healthcare?
I think it’s vital. If you believe that a number of key elements are needed to fully treat and care for a patient, there’s no way one single company can provide that full solution. You have to have an open architecture, you need an open mind, and you need to make those partnerships, whether in technology or in the health domain, in order to understand and bring forward the solutions that are needed. I don’t think there’s any other way to do it; and there’s also no other way if you look at modern IT and the approaches we’ve seen in that domain.
You also have to acknowledge that different companies leap-frog: there are evolutions happening, and nobody can be the complete expert in the full domain. In Philips we have leadership in imaging and the IT area, but that’s only part of the solution in taking care of patients. If you want to look at the larger scope of healthcare, partnership is essential.
How does the agreement to develop the new proton therapy centres illustrate this view of partnership?
Philips sees oncology as one of its key focus areas. We play a leading role in the imaging aspect, which is extremely important for diagnosis and also for follow-up treatment. We do not perform therapy. IBA is the global leader in proton therapy, which is an innovative form of radiotherapy now being developed from pure research into the first stages of being a general tool for treating cancer. For us it is highly important and very fruitful to have this collaboration, because we see that in the future imaging will become more and more important in the delivery of radiotherapy and the evaluation of treatments – and that is true of surgery and chemotherapy as well.
Is this characteristic of the way you’re looking to meet public health needs?
I think so, because it’s about putting the patient first. For us as a company it’s absolutely vital. If you can’t team up and understand from the complete care pathway or patient regimen what is needed, and get the essence out of that, you will not be where our customers expect us to be in the future. I think this is a clear demand from their side: they want to develop their institutions, they want to develop their care, they have a number of challenges, and if as a modern healthcare technology supplier you are not willing to embrace that approach by understanding that you are only a part of the solution, I think you will have a problem, and that’s certainly not where our customers will expect us to be moving forward.