Southeast Asia’s Healthtech Boom Looks Set To Continue In 2024 And Beyond

During the COVID-19 pandemic, the world was unprepared to face such a global health crisis. This event acted as a wake-up call, driving a profound shift in the perception of the healthcare industry. People have come to recognise the essential role of healthcare in society, realising its lasting relevance and growing demand in the years to come. 

Emerging startups have seized this opportunity, leveraging the heightened demand for healthcare solutions to innovate and develop new digital technologies that transform the industry. Over the past five years, healthtech in Southeast Asia has secured approximately USD 1.5 billion in funding, representing over 87% of the total capital raised in the industry to date.

Southeast Asia’s healthtech boom reached its highest point of growth in 2023, with a funding peak of USD 515 million. A significant portion of this growth came from early-stage investments, which accounted for USD 308 million of the total funding, reflecting investors’ confidence in the long-term potential of these startups. Notable companies like Halodoc secured USD 245 million, Doctor Anywhere USD took in 172.3 million, and HealthifyMe, which raised USD 105 million, played a pivotal role in this expansion.

On average, healthtech startups in Southeast Asia take about 2.8 years to secure seed funding, highlighting the fast-paced nature of this thriving ecosystem and the strong investor interest in the region’s potential to revolutionise healthcare.

Emerging new trends in the market 

With specialised doctors often located far from their patients, telemedicine has emerged as a crucial solution, enabling virtual consultations through video calls and messaging platforms. This technology makes healthcare more accessible to people in rural or underserved areas who may struggle to reach medical facilities. By providing care remotely, telemedicine reduces the burden on healthcare systems and cuts costs and waiting times for those in need.

For example, Singapore’s Ministry of Health Office for Healthcare Transformation has implemented a remote monitoring and SMS chatbot service that supports patients with chronic conditions like diabetes, a significant regional health concern.

Wearable technology is another transformative trend in the healthcare sector. These devices continuously collect and transmit medical data from patients to healthcare providers in real-time, offering critical support during health emergencies. Wearables track vital signs, including heart rate, blood pressure, and glucose levels, alerting users if they need immediate medical attention. If the user fails to respond to the alert, the device can automatically contact emergency services to report the condition.

One well-known example is former NBA player Sean Elliott, who credited his Apple Watch with detecting atrial fibrillation, a potentially life-threatening heart rhythm disorder. The watch alerted him to the irregular heartbeat even before he experienced any noticeable symptoms, helping to prevent severe complications like a stroke.

Role of AI and GenAI in healthcare

Artificial intelligence-powered tools and algorithms are revolutionising diagnostics by analysing medical images, laboratory results, and patient data faster and more precisely. Machine learning technologies are now capable of detecting diseases such as cancer, neurological conditions and cardiovascular disorders at very early stages, often before symptoms become apparent.

This proactive approach to healthcare allows for quicker interventions, which leads to more effective treatment and improved patient outcomes.

Generative AI (GenAI) is also making waves in healthcare, generating both excitement and some concern among technologists and medical professionals. While AI is already functional in healthcare for tasks like predicting adverse events and optimising operating room schedules, GenAI is emerging as a powerful new tool that promises to unlock significant potential within the industry.

Estimates suggest that GenAI could play a pivotal role in realising up to USD 1 trillion in improvements across the healthcare sector by automating tedious, error-prone tasks, providing clinicians with immediate access to years of clinical data, and modernising outdated health systems infrastructure.

Investments in GenAI healthcare startups are rising sharply, even as broader healthcare startup funding experiences a decline. According to GlobalData, venture capital (VC) deals related to GenAI in healthcare surged from USD 81 million to USD 439 million between January 2022 and June 2024, even as the overall healthcare startup funding dropped by 65% in the same period. During the first half of 2024 alone, GenAI-related VC deals in the healthcare sector reached a value of USD 447 million. 

While Southeast Asia’s healthtech boom continues to unlock numerous opportunities for innovation and growth, startups in this sector face several challenges that they must carefully navigate to achieve success. Regulatory hurdles, interoperability issues, building trust among users, and securing adequate funding for expansion are some key obstacles that require strategic solutions. To overcome these challenges, startups working in healthtech in Southeast Asia must develop a deep understanding of the region’s complex landscape and adapt their approaches to meet the specific needs and standards of the market.

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