A Healthy Healthcare (for your company’s growth!)

September 19, 2023

It’s often been said, “The more things change, they more they stay the same”. That may be true for several situations, but it’s not exactly true regarding healthcare expenditures in the United States. There’s tremendous growth on the horizon for new frontiers in medicine!

National spending on healthcare is projected to grow at an average rate of 5.5% per year between 2018-2027 and will reach nearly $6.0 Trillion by 2027. This means Healthcare will grow to over 19.4% of the U.S. GDP by 2027. A primary contributor to this growth is the rise in those eligible for Medicare and increases in higher private health plan payments and higher spending growth for hospital care and for prescription drugs.

“So what?”, you might say , “Everything is going up in price and cost! Inflation is currently at somewhere around 3%! It’s just crazy!”

It is crazy – crazy with opportunity for companies who develop new pharmaceuticals, treatments, medical devices and medical technologies. The global markets are also increasing, and as the U.S. “baby boomer” population ages, as we continue to pursue cures and treatments for cancer, as new healthcare issues surface (think: viruses!), the need for new medical discoveries will accelerate. This represents tremendous potential for growth companies in biotechnology/biomedical fields.

The promise of artificial intelligence, robotics, 3D printing, and micro-circuitry shows tremendous growth capability in the field of intelligent prostheses and in medical diagnostics. New devices (even “diagnostic smart toilets”!) for early detection of infectious disease, new methods for early cancer detection and monitoring of chronic disease will be required – and will be developed. Vaccines have become incredibly important and gene editing/therapy looks promising, as does the development of new ideas for organ transplants/replacements.

BUT YOU KNOW ALL THAT – of course you do! That’s why you’re in the biotech/biomed business, and that’s why you know your future’s so bright, you have to wear shades (obscure 80’s song reference, but you get the idea).

And what do you need for that growth? Money, of course – real investment capital, loans, grants – all of that! Plus, you need the right people – scientists, technicians, administrative, scale-up, manufacturing and on and on. And let’s not forget space – “wet” laboratory space is not easy to find and certainly not inexpensive to lease! There are other factors (some say “luck” is in there, somewhere) to secure growth, but these are three key items that are a base for success. For instance, it would be great to have some types of equipment and who wouldn’t want to be around other companies involved in technological discovery. Those items are “icing on the cake”, as they say (they say a lot of things, don’t they?) to reaching your desired market in a timely fashion. Indeed, time is money – and being late to market is often a fatal circumstance for your company.

So how do you insure you’re “on the right track and picking up steam”? First, monitor the trends – as you can tell from the first part of this blog (if you’ve read this far – I admit it, data is often boring) there are great predictions for healthcare expenditure growth in the years ahead. But which sectors will over/under perform? Keep your eyes on the data! Second, position yourself regarding the “3 basics” mentioned above – insure you line up strong, significant funding. It’s not “just about the money”, it’s about the SMART money – people who can help you, connect you and advise you. Third, getting the right people is the true key to success in biotech/biomed. Network, network, network – stay connected to your industry, to your peers, to your colleagues and get their help in building an awesome group of people who can assist you in reaching your goals. Finally, in addition to these basics, find the right spot for your company in terms of atmosphere, assistance, facilities, and location. There’s a lot more involved (again, as you know!) but these key items will help you to take advantage of the tremendous growth in your healthcare/biotech market!

Mark Long 2023