Presentation of the Digital Health in Catalonia Report, a strong, growing subsector in the BioRegion

If the forecasts are correct, the global digital health market will grow at a rate of 16.5% a year and will exceed 550,000 million euros by 2027, as indicated by the digital health in Catalonia tech report produced by ACCIÓ in collaboration with Biocat and presented this November. “The digitisation of health systems is one of the priorities set by the European Union”, indicated Joan Romero, executive director of ACCIÓ, which he says is an important sector for Catalonia and a priority for the region’s government. 

The outbreak of COVID-19 speeded up the number of and investments in digital health companies, along with the increase in demand for remote solutions, the rapid expansion of ITC infrastructure, and the increase in raising awareness of society’s physical and mental wellbeing. “Beyond the pandemic, growth in this business option is mainly due to greater awareness of society regarding its physical wellbeing, with new options such as remote consultations", explained Imma Rodríguez, Market Intelligence manager at ACCIÓ. 

2021 was the year in which investment and financing in this market skyrocketed to reach 11.047 billion dollars, almost twice that of 2020 and boosted primarily by operations in the United States and the UK, Canada and Germany, as shown in the following graphs.
 

Source: “Digital health in Catalonia” report by ACCIÓ in collaboration with Biocat. 

The digital health startup boom in the BioRegion

This exponential growth was also felt in the BioRegion, where the segment, with 267 companies, a turnover of 440 million euros, and employing more than 3,000 people, is growing at the fastest rate despite being the youngest subsector: “An average of 20 new digital health startups are created each year in Catalonia, and 95% of all the companies have been established in the past 10 years”, explained Silvia Labé, Marketing, Communication and Competitive Intelligence director at Biocat, at the presentation of the report.
 

Silvia Labé from Biocat and Imma Rodríguez from ACCIÓ, during the presentation of the “Digital Health in Catalonia” report.
 

Digital health startups have also grown in terms of investment, exceeding 60 million euros in 2021, when investment was almost doubled in comparison with 2020, strengthening growth in investment raised for the 5th consecutive year. The increase in international venture capital in this segment has had a lot to do with this, according to Silvia Labé. “Of the 56 venture capital rounds, 20 included international venture capital funds. In fact, 30 international investors supported Catalan startups in 2021, despite this not being the case of the main specialist funds established in Barcelona, such as Alta, Assabys, Inveready and Nina Capital”. 2020 and 2021 saw major operations of over €10M raised by startups such as Koa Health, TopDoctors, Mediktor, all with international participation. 

The report includes a detailed map of the companies that shows the diversity of areas in which they work, such as telemedicine clinical tools, DTx or digital therapies, supported medical decision-making, and health and wellbeing apps and the technologies they use, such as artificial intelligence, omic technologies, virtual and augmented reality or big data.
 

Source: “Digital health in Catalonia” report by ACCIÓ in collaboration with Biocat. 

 

Digital health investment prospects

The report indicates that, this year, there will be a 50% drop in global investment in digital health in comparison with 2021 to stand at levels similar to those of 2020. The main reason? “A general trend in most technological areas given the economic situation in 2022 and the uncertainties faced by global investors, in addition to the investment bubble of 2021”, explained the representative from ACCIÓ.
 

Source: “Digital health in Catalonia” report by ACCIÓ in collaboration with Biocat. 
 

In Catalonia, consistent with the international markets, the first quarter of 2022 recorded a figure similar to that of 2021, which slowed down in the second quarter (30 million euros). At this point, the representative of Biocat, Silvia Labé, indicated that a return to the overall figures of 2020 is expected, and called for the audience to attend the presentation of the BioRegion Report on 13 February in Barcelona, where the final figures for 2022 will be announced. 

The main challenge: adopting innovation in the health system

“Catalonia has great appeal for creating and attracting digital health companies”, agreed Teladoc Health, Trialing Health and ELEM Biotech, the three business success stories that took part in the session. “We have most of the ingredients: a top-class health system, a powerful pharmaceutical industry, talent, success stories, startups and specialist investment funds”, underlined Josep Carbó, vice chairman of Teladoc Health. “But what is lacking involves putting all this into practice and accelerating the adopting of this innovation in the health system”. 

The stance of the other participants was along the same lines, who consider the operating of innovation to be the ecosystem’s main challenge. “It is difficult to convince someone from abroad that our technologies our fantastic if the country itself and its health system are not using them” or “It is easier for it to be implemented around the world than 2 km from home”, claimed Marc Delgado, CFO of Trialing Health and David Oks, business development at ELEM Biotec.

Despite this, the three companies continue to support Catalonia. This is the case of Teladoc Health, a US telemedicine and healthcare multinational that established its main headquarters in Barcelona after taking over one of the top and most noteworthy Catalan digital health startups, Advance Medical, and which plans to open an R&D health hub this December, from where all the company’s technological innovation will be produced. “We plan to hire 5,000 professionals over the coming five years in order to consolidate the maximum amount of talent in Barcelona”, explained Josep Carbó, which insisted on the fact that "telemedicine is not a fashion and is here to stay”.

More information

Check the digital health in Catalonia tech report