Introduction
There are a range of things you need to know before entering a new market, some of which will affect how you enter and others might kill the project entirely. We work with companies in the healthcare, medical devices and health insurance spaces to help them understand and assess new markets and this blog lays out some of the most important factors to look into when considering new healthcare markets for our clients.
By understanding the regulatory landscape, mapping out who pays and how, getting clear visibility of the potential channels and routes to market and analysing the competition, you can put yourself in a good position to assess the potential for you in a given market and lay out an effective go to market strategy.
What is the regulatory landscape?
Knowing who will approve your product or service, how long that will take, and what hurdles you might face is critical for planning your entry into a new geography.
Some countries in Europe will accept EMA approval, while others will have additional processes to go through. In the USA, it’s possible you will need to be approved in each state you wish to sell or operate in, in addition to the FDA, adding time and cost.
Some markets (including the USA, EU and Japan and Brazil) offer accelerated approval pathways for certain devices and treatments. Understanding whether these could be relevant to you could cut time to market dramatically.
Interviewing people who have been through this process before, or who help to administer the processes, can give insight into the time taken, common slip-ups and how to navigate the process most efficiently.
Who pays?
Identifying who it is that you need to convince that your product or service is worth paying for in your desired market will shape your product’s fit and pricing.
Medicare accounts for ~20% of the USA’s national health spending, while private spenders make up ~30% – a not insignificant market, but highly fragmented. By contrast, Brazil’s SUS procures a significant portion of medical devices in the country, which has one of the largest public healthcare systems in the world. This consolidation of purchasing provides a much simpler target for new market entrants.
Even where there is one large buyer, there may be benefits in D2C marketing and sales: in the UK, where most people rely to some extent on the National Health Service, some patients will opt to buy devices privately if they aren’t available through the NHS. Continuous Glucose Monitors were commonly bought privately before they were available through the NHS to Tier 1 diabetics in 2022, and now are bought privately by some Tier 2 diabetics.
Are there channels or partners that could give us the ability to scale quickly?
Piggybacking on established relationships can get your product in the hands of HCPs or patients much more quickly than building a reputation on your own, so it pays to investigate what opportunities there might be in markets under consideration.
In 2022, telehealth provider Teladoc announced a partnership with Amazon, making the service available through all ~47m Echo devices in the USA. This partnership effectively put Teladoc in ~20% of American homes overnight.
Thriva announced a partnership in 2023 with UK retailer Superdrug to bring their blood tests and diagnostic services to 70 high street stores. Superdrug run the booking system and have nurses on hand to administer blood tests. They also promote the service through their established channels.
Knowing where consumers go to get help around their health and who they trust will give you a good idea of what channels and partnership options might be available to you in a market. HCPs, consumer health advocates and experts from patient groups can all provide useful insight to help decision-making.
What is the competitive landscape?
Is anyone offering a similar product or service? Does anyone have a stranglehold on this market? Both important questions and could potentially kill a market entry plan.
Within European countries, the top 5 insurers make up less than 40% of nonlife insurance GWP in UK, and only marginally more in Spain, Switzerland and Germany, making these markets attractive to enter for health insurance providers. By contrast, the Netherlands and Sweden sit at around 80% of GWP across the top 5 providers, which might signify a more stagnant market that could be attractive for a highly disruptive player to enter.
Through interviews with former staff members at competitors, it is possible to build a picture of how the market might respond to a new entrant, allowing you to build a more nuanced market entry plan, targeting particular customer segments or geographic regions.
Conclusion
Healthcare markets can vary drastically and if you’re planning to invest in entering a new geography, it pays to understand the landscape and context before making any big moves. Doing your diligence can help avoid any missteps and uncover insights that might help you outcompete or achieve scale quickly.
White Space have a proven track record of helping businesses assess potential markets for them to enter and provide guidance on these 4 questions in greater detail. If you’re thinking about entering a new healthcare market soon, contact White Space to see how we can help.