New Jersey has been a leader in the United States healthcare and life sciences industries, and now that expertise is expanding into healthcare technology, or healthtech. In this post, Choose New Jersey reviews the outlook of healthtech, where the focus may be moving into the future, and how New Jersey can help healthtech companies be successful.
Healthtech in 2020
Image via Hampleton Partners
Healthtech’s Forecast for Investment
Some industries need a long gestation period to mature, but healthtech has rapidly become a top commodity for venture funding. At the conclusion of 2015, investments had increased within the industry by over 200% over a five year period and the industry was valued at $7.2 trillion in the US alone, according to Deloitte. Since then, investments have only increased, with Hampleton Partners reporting that $26.9 billion was invested in the first half of 2019, yet another record for the industry.
What are the trends in Healthtech?
- Patient engagement and monitoring solutions
- Patient and disease tracking software
- HIPAA-compliant patient satisfaction software
- Medical Use of AR and VR technology
- API adoption for better medical software connectivity
“Healthcare technology’s early days primarily involved a company installing its closed solution in hospitals and doctors’ offices. Since then, the rest of the tech world has moved toward cloud-based solutions and open API platforms. Healthtech professionals agree that most cloud-based solutions are now more secure than local server solutions alone.” – Mike Wenger, VP of Patient Engagement at Trialscope in Jersey City
Succeeding in Health Tech
Why New Jersey is Perfect for the Industry
As with any tech industry, innovation and creativity enable companies of all sizes to disrupt the marketplace. STAT, a prominent journalism site in healthcare, sat down with Dr. Paul Yock of Stanford’s Byers Center for Biodesign to understand what a company needs to succeed in the healthtech industry. Dr. Yock has worked with many healthtech companies over the years, and he suggested specific guide points for companies to improve their success.
1. Find Unmet Clinical Needs
Whether it’s a symptom of a disease that isn’t being treated, reducing the time of a diagnostic tool or another task for a doctor, it’s crucial to find a solution that makes a meaningful difference for providers, payers, patients, or a combination of the three. That means an in-depth understanding of the clinical needs that you are solving, which can only come from working in an area with multiple opportunities for collaboration.
Healthtech often means extensive research and development, but the solution can often be underestimated fiscally once it’s brought to market.
2. Understand the Economics of Your Solution
From these solutions, companies need to put themselves in the shoes of payers and providers. Is there a need to establish a new reimbursement code for this technology? What studies will the FDA require? Will it save insurers money or cost them more? These types of questions may drive which idea will have the most success.
3. Hire Smart
It’s cliché, but for young companies the right people are crucial for understanding the process and time it takes to deal with patients, providers, regulators and insurers.
4. Ask for the Right Amount of Funding
Many healthtech companies are operating with extremely lean operation costs, which allows them to ask for less and have less overall burden, but ensuring that your company raises the proper amount of money means working with venture capitalists who know and understand the industry.
How New Jersey Grows HealthTech:
For each guidepoint, New Jersey has ideal resources to support companies in their growth. New Jersey has an incredible foundation of companies within healthcare and life sciences. There are more than 21,000 healthcare establishments, 113 hospitals, 71 acute care hospitals, and nearly half a million people working within healthcare. Thirteen of the world’s largest pharmaceutical companies and medical technology companies call New Jersey home.
World-renowned research institutions can be found across the state, such as the Rutgers Cancer Institute of New Jersey. Major clinical research organizations are also available, such as Covance and InVentiv Health Clinical. There are also 31 public and private 4-year universities and 19 county colleges. If that’s not enough, Philadelphia, New York, Boston, and Washington DC are all within half a day’s drive or less. When it’s all said and done, New Jersey is a dream for healthtech companies to survey and network for the most valuable clinical issues to solve.
Coinciding with these well-established companies, new resources, specifically for startups, accelerate growth while also reducing cost. One example is the New Jersey Innovation Institute (NJII), a division of the New Jersey Institute of Technology. The institute specializes in helping companies in life sciences and technology innovate and transform their industries. NJII is also building a broader community for healthtech by bringing companies in its Healthcare Accelerator Program into the fold of notable health summits, such as the 2019 HealthTech Summit at Fairleigh Dickinson University.
In addition to the extremely large life science community – you won’t find more scientists and engineers in one area anywhere in the U.S. – New Jersey’s Economic Development Authority (NJEDA) is doing its part too. Programs like NJ Ignite provide free rent in incubators for young companies and also support the incubators themselves. Healthtech has been a big beneficiary for this rent support. BigMagic, a digital marketing company for healthcare, was one of the first to receive support, and more recently, OculoMotor Technologies was given a boost for their virtual reality vision therapy.
“I’ve always had an affinity for virtual reality, so I was excited to use my time at NJIT to combine this passion with my interest in biomedical engineering to develop the concept for OculoMotor Technologies,” company co-founder John Vito d’Antonio-Bertagnolli said. “We’ve been fortunate to benefit from the combination of support from NJIT amenities and talent pool, State resources, and investments from local investors. The sense of entrepreneurial community is one of the main reasons we chose to stay and grow in New Jersey.”
For larger companies, a powerful infrastructure is in place for company success and quality living. New Jersey is ranked number one in internet connectivity, has extensive transit access, and several international airports. Easy access to metropolitan areas like Philadelphia and New York City significantly expands your client base and also exposure to three of the largest per capita regions for venture-capital funding, but neither your business nor your employees have to deal with the cost of living there. Jersey City was cited by PricewaterhouseCoopers Emerging Trends in Real Estate as one of the cities in Northern New Jersey that is experiencing an influx in “highly educated millennials,” specifically because of better costs and concentration of tech companies. Individuals living in Jersey City are paying less than half of equivalent real estate in New York.
Learn More About Why Healthtech is Thriving in
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