In the post-pandemic era, where is the fulcrum point of the medical electronics market?

The enormity and gravity of the impact of COVID-19 has been truly unprecedented, and there is no end in sight. As the pandemic continues to ravage many countries around the world, those who were initially successful in preventing the spread of the disease now fear a resurgence during the colder seasons, compounded by public complacency. While nobody knows when this pandemic will end, one thing’s for sure – COVID-19 has activated and accelerated the medical electronics market.

To date, this market sector has been perceived as an “ox” that shows slow and steady growth with little fluctuation. For instance, a predictions chart for the global market of emergency medical equipment (Image 1) from before the pandemic shows that growth in various subdivided markets is stable and methodical. As we all know, demand for respirators exploded after the pandemic began wrecking health systems around the world. The global demand for respirators in 2019 was just 77,000, while in April 2020 the demand in New York City alone was 33,000. Similarly, demand for forehead thermometers was such that it became difficult to obtain one even after their prices skyrocketed in the first few months of 2020.​

Image 1  Market predictions of global market for emergency medical equipment (Source: www.fortunebusinessinsights.com)

However, for most vendors, the revenue earned from these "unexpected" orders brings little comfort. In fact, it represents an upset and disorderly supply chain system that will ultimately increase the overall costs of doing business and erode profit margins. Eventually, this unsustainable growth may result in a sudden crash, like free-falling off a cliff, which no business would welcome or survive.

For these reasons, it is important to filter short-term market fluctuations in order to identify long-term developments in the post-pandemic medical electronics market. We urge everyone to join us as we do a little digging around the market of today, and volunteer a few predictions about the market of tomorrow.
 

Medical Infrastructure

The most important insight that we have gained from this pandemic is a realization of the vulnerabilities of our current healthcare system. Regardless of how rosy things may seem, systems have been stretched beyond their capacities in the face of this major public health crisis. In order to prevent repeat situations in the future, we have been forced to learn from our mistakes and think about how to improve the basic infrastructure of healthcare.

The most direct way to impact medical infrastructure is to increase the purchases of new equipment. This is driven by government procurement as well as an enhanced awareness of health among the general public. For instance, the defibrillators mentioned earlier are essentially first aid equipment for the heart. While they weren't previously considered mandatory in certain scenarios, they will soon become standard equipment. The future of medical electronics will rely on business opportunities arising from increased demand for specific items of medical equipment.

In addition to adding and upgrading hardware, “software” enhancements in medical resource management are also required. There is huge opportunity for growth in the use of technology to digitalize the management of medical resources. For instance, the use of RFID tags that are routinely applied in the management of surgical equipment can be extended to the management of medical equipment. Companies are already looking for ways to utilize NFC tags in the management of critical resources such as drugs and vaccines, to gather data and gain insights. In terms of the value chain of "data", there are many "opportunities" available from the sensing and transmission to the processing of data.

Image 2  Application scenarios of RFID in healthcare (Image source: Murata)
 

Changing Operation Models

The impact of COVID-19 on healthcare was seen not only in the sector of medical infrastructure, but also in the entire operation model of healthcare.

Traditionally, healthcare resources are centralized in hospitals and medical institutions under the management and operation of professionals. One of the clear limitations of this model is a low effective area of coverage, a vulnerability that was magnified during this pandemic when medical resources have been strained.

In order to redress this problem, the industry is banking on the construction and operation of a remote medical system based on the Internet of Things (IoT). The core concept of this new operation model is to utilize IoT technology to distribute medical resources to areas that are closer to the end-user (patients), thereby achieving broad coverage, immediate feedback, and highly effective diagnosis and treatment. Effectively, this makes normalized health monitoring a real possibility and changes the public healthcare strategy from treatment to prevention, with an emphasis on taking precautions before diseases occur.

New operation models will also generate new products and solutions. More and more portable consumer-grade healthcare equipment, such as blood pressure monitors, blood glucose meters, ECG monitors and ultrasound scanners, are entering people's lives and replacing (or supplementing) traditional professional medical equipment.

The challenges that come with the advent of portable healthcare equipment are plain to see. "New species" of medical healthcare equipment must deliver professional (accurate) performance as well as address many other challenges such as miniaturization, low cost, fast iterations and upgrades. Those developers who are able to quickly identify and solve the "pain points" during this shift in the healthcare model will break new ground in the market and win.

Image 3  Portable pocket handheld ultrasound scanner developed by Clarius with assistance from Avnet (Image source: Avnet)

Expanding the Healthcare Ecosystem

From the construction of medical infrastructure and changes to operation models, it is clear that the overall healthcare system will become a fundamental factor in supporting future social development.

Inevitably, an ecosystem will gradually form and expand around this concept, eventually crossing over to fields that were previously unrelated to healthcare. These new "crossovers" will give players in non-healthcare related fields the opportunity to "bridge" into healthcare.

For example, when face masks became a scarce resource during the pandemic, the need to efficiently distribute them to those in need became a challenge that required solutions. To this end, "ID-based face mask vending machines,” which link vending machines from the retail industry to customers’ personal health insurance accounts, were developed. As medical insurance regulates quotas for face masks with purchase records, customers can conveniently purchase their allocated number of face masks from vending machines instead of sourcing them from other vendors.

Image 4  ID-based face mask vending machine based on i.MX application processors from NXP (Image source: NXP)

We believe that as healthcare systems improve and expand, these types of crossover collaborations will not only become more commonplace, but also come to be viewed as the healthcare industry’s contribution towards the long-term development of future societies and economies.

As the pandemic is still very much a part of our daily lives, the "post-pandemic" era is nowhere in sight. However, this doesn’t stop us from identifying the future "fulcrum point" in the field of healthcare, so that we may plan and strategize in advance. Be inspired, and take action!