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  • Julie Pelta

Digital Health: Don’t believe the Hype. Or should you?

Having worked in healthcare for over 20 years I am passionate about the sector. Being part of something that really changes, impacts and improves people’s lives is truly a privilege.

My passion for health is both intrinsic and taught. My days at Johnson and Johnson, Ethicon, reminds me of the company credo daily instilled in us, a sense of purpose, belief that you are part of something amazing.

I still carry this belief and applaud Johnson and Johnson for the effort they put into their business internally to ensure they got the best results for their businesses and the patients they helped treat.

The fundamentals of an established healthcare company are strong. Tenure, market experience, investment and strong revenues. Built over many years but also with a strong eye on the key commercial factor who is paying, where are the revenues coming from?

I had the privilege of being part of the team that set up a division within the UK JnJ business. Our remit was to establish the Bariatric market in the UK. We undertook a huge amount of work to identify and establish users, patients, early adopters, Key Opinion Leaders, thought leaders. One thing however we never wondered about was who was going to pay? The reimbursement path was clear, although no coding was allocated at the time (2005 ish), our previous relationships and willingness to work with one of the biggest names in healthcare opened doors of hospital chief execs, finance and procurement directors through to the Department of Health, head of policy!

Now I split my time between established companies and the healthcare start up space and it’s a very different world. Having worked on the “inside” and now helping companies looking in from the outside, there is a naivety that seems so obvious to me, but in many situations truly a revelation to the start ups.

I often joke about the films, “Field of Dreams” :“If you build it, he will come”, or for the more musically minded, “Wayne’s World: If you book them they will come”, this naive self belief works in the movies. Sadly not in the UK Health system today!

I maintain that having the most innovative, exciting, disruptive product is not the answer, it’s the execution of how you sell it and having a clear path to funding. This may seem really basic, but I see it missed time after time by the people so involved in their outstanding innovations, they forget the basic commercials.

If you strip back any successful company it’s their clear view of their customer and the budgets they can spend which ensures success.

Many really exciting digital health companies in the UK are now looking outside of the UK market for this reason. Trying time after time to break into the NHS, it’s a huge investment and the system is just not geared up for it.

I spent years working with surgeons, doctors, theatre staff, procurement, finance in NHS hospitals nationwide. Working with numerous stakeholders, using products I was introducing, analysing the health economic benefits and savings to the trusts, it became clear that the hospitals on the whole are not set up to receive or promote innovation. There are a few famous teaching hospitals that embrace innovation BUT rarely pay for it.

They give companies the privilege of “piloting” their innovation.

The pilot programmes help the hospital with their status of adopting innovation and the pilots themselves help the healthcare companies share some exciting stories with existing and future investors. But when it comes down to the day to day acquisition of the new shiny product or service many people are left scratching their heads and no better off.

A huge amount of time is spent on pilots in the NHS, showing savings of time and or money. But to push it into the mainstream funding channels, to become a standard product/service that demonstrates in-year savings is not easy.

The coding system for reimbursement is still fairly limited. Most hospitals in the UK are now operating at a deficit. Payment terms for suppliers are stretched, killing cash flow, which for a small company can end them. It’s a huge risk.

It’s not surprising then that the big institutional investors and banks shy away from digital health investment. Many investors I speak to are pondering whether start up digital health is a good place to invest now at all.

The story of innovation in health care is a good one. But when you’ve spent so many years watching a creaking system day to day, I believe you would wonder too, how is this ever going to be mainstream in our current system?

It’s not all doom and gloom, NHS Digital have some really exciting plans for digital transformation, alongside existing and fairly new services which are transforming how we receive our healthcare digitally who have managed with huge effort to carve out funding streams. There is light at the end of the tunnel, but it’s a bumpy ride!

I’d love to hear your thoughts :)

Julie Pelta

With over 20 years experience in healthcare. From classic corporate roles through to consultancy and medical device distribution. Experience in working with Med-Tech product and service companies. From product innovation, delivering enhanced patient outcomes to digital service innovation.

About Us

Industry knowledge specialists who work across the vertical to minimize risk. We use our network and in-depth understanding of the system, and how to navigate it. We work in areas from Digital Health to Med-Tech; Education to Service provision; Commissioning to Investing; our experience is vast and track record impressive.

Activities undertaken with companies developing products :

Whether an SME or corporate, the need to build a proof of concept and validate the market early is essential. We believe “fail fast, change quickly” is the key to success and the only way to develop “market-ready” products at pace.

Activities undertaken with companies developing products:

• Market Validation

• Co-Design: Demonstrating demand side articulation of need

• Stakeholder Mapping

• NHS Readiness Assessment

Activities undertaken with companies investing in products:

Making objective decisions based on limited due diligence in an opaque marketplace like the NHS is tough and risky. Deep knowledge allowing for informed decision-making should be central to any investment strategy. We will provide the clarity needed.

Our due diligence services for companies investing:

• Opportunity Sizing

• Market Validation

• Risk Assessment

• Competitor Analysis

We will make sure that your organization is equipped with the tools to make the right decisions and that your product has the highest chances of success that it can. This includes support during product design, creation of your go-to-market strategy, managing stakeholder engagement and general understanding of the health economy.

With over 20 years of experience working with people that commission services and those that provide them, we understand the barriers and how to overcome them.

Being successful starts by clearly articulating your product or service and defining a precise problem that it solves. This is our core business. To help you become more successful.

We work with start-ups, SMEs and established corporates all at different stages of their product life cycles, but who all face similar challenges.

Contact Us:

+44 (0)7866 501 084



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