1 / 51

Profiles of E-health Businesses

Profiles of E-health Businesses. KEY MESSAGES. E-health business growth is being driven by the high degree of industry fragmentation, interaction costs and consumer/provider demand

rafiki
Download Presentation

Profiles of E-health Businesses

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Profiles of E-health Businesses

  2. KEY MESSAGES • E-health business growth is being driven by the high degree of industry fragmentation, interaction costs and consumer/provider demand • A broad range of e-health business have emerged to facilitate efficient interchange of content, commerce and interconnectivity • Significant opportunity exists for the development of high value e-health businesses in Korea 0010.Profiles of E-health Businesses.SNUH

  3. DRIVING FORCES: FRAGMENTATION AND INTERACTION COST • Hospitals • Care centers • Clinics • Pharmacies • Suppliers • Insurers/funding bodies 0010.Profiles of E-health Businesses.SNUH

  4. DRIVING FORCES: FRAGMENTATION AND INTERACTION COST The recognition of opportunities for process improvement and cost reduction is driving the development of more integrated, consumer oriented and outcomes focused health systems. • Continuum of care • Wellness-focus • Case/Lifetime-oriented • Integrated delivery networks • Capitation/casemix type payments • Cost centres and prevention incentives • Focus on customer needs • Episodic Care • Intervention Focus • Transaction-oriented • Hospital/Hospital systems • Fee-for-service/global budget • Revenue Centres/ intervention centres • Focus on internal needs 0010.Profiles of E-health Businesses.SNUH

  5. DRIVING FORCES: CHANGING CONSUMER DEMANDS • Recognition of the enormous growth in ability to access information • Desire for greater control/participation • Increasing administrative and clinical service quality expectations • Significant take up of purchasing over the internet 0010.Profiles of E-health Businesses.SNUH

  6. DRIVING FORCES: PROFESSIONAL INFORMATION NEEDS • Ongoing information needs high • Patient data collection and management is arduous and time consuming. Little information is captured as a by product of care delivery • Basic lack of integrated clinical information systems • Practice management systems demands are high for small practices 0010.Profiles of E-health Businesses.SNUH

  7. KEY MESSAGES • E-health business growth is being driven by the high degree of industry fragmentation, interaction costs and consumer/provider demand • A broad range of e-health business have emerged that facilitate efficient interchange of content, commerce and interconnectivity • Significant opportunity exists for the development of high value e-health businesses in Korea 0010.Profiles of E-health Businesses.SNUH

  8. E-HEALTH BUSINESS FRAMEWORK • Description • Revenue model • Create and aggregate content, build communities, and offer value-added services • Multiple revenue streams • Advertising • Sponsorships • Subscriptions • Service-related fees • Customer information portals • Physician/Healthcare professional services • Content • Health plan/Hospital services • Provide online commerce solutions for product and service purchases • Direct online commerce and off-line pull • Business-to-consumer (health products) • Specific • Commerce • Business-to-business • Online insurance brokering • Provide solutions to connect various healthcare participants (information connectivity) • Mostly transaction-based revenues, also fees from • Subscriptions • Licenses • Services • Transaction/practice management services • Online patient medical records • Connectivity • Online care services • Provide end-to-end solutions and/or a combination of multiple services to various healthcare participants • Varies • Horizontal • Aggregate • Vertical Source: McKinsey analysis 0010.Profiles of E-health Businesses.SNUH

  9. E-HEALTH CONTENT: 3 MAIN APPLICATIONS • Description • Examples • OnHealth.com • MayoHealth.com • iVillage.com • Adam.com • DrKoop.com • DiscoveryHealth.com • Healthcentral.com • Oxygen’s Thrive online • Clinical information and other health-related topics • Customer information portals • Physician/Healthcare professional services • Content • Health plan/Hospital services Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  10. Description • Customer-focused content health site targeting women aged 25 to 54 • Features include: • Health information and news • Interactive tools • Physician directory • Community discussion groups • Live interviews • Drug database • Online shopping • Online classes • Premium services CONTENT – CUSTOMER INFORMATION PORTAL EXAMPLE: ONHEALTH.COM Company Snapshot Launched: July 1998 Ownership: Public (Nasdaq: ONHN), Acquired by Healtheon/WebMD Industry: Healthcare online content providers Market cap: $75.0 million 1999 Revenues: $3.8 million Other: Most trafficked health site on the web as of 2/2000, “Best Health and Medicine Website” - US News and World Report • Value Proposition • Deep proprietary health content covering both traditional and alternative medicines • Partnerships with the Cleveland Clinic, Mount Sinai Cardiovascular Institute, the Scripps Clinic, the International Diabetes Center, Harvard Medical School • Resident expert columnists • Traffic driven to Onhealth.com from +600 different sites • Business Model • Revenue primarily generated through: • Advertising/ sponsorships • E-commerce transactions • Premium services • Content syndication • Strategic Relationships • Portal: AOL Digital Cities, Infoseek/Go, GeoCities, Planet Direct, WebTV, Weather.com, Myway.com, Snap.com, Yahoo!, MindSpring, About.com, Ask Jeeves, Better Homes and Gardens • Commerce: drugstore.com, The Vitamin Shoppe, Amazon.com, ProFlowers, American Greetings, WholeFoods.com, gazoontite.com, The Green Marketplace Key Issues Differentiation on proprietary health content is subject to fierce competition from other health content, lifestyle-sites, women-sites, and portals Source: Company financial report and website, Hoover’s, News clippings, Jupiter Analyst Report 9/99 0010.Profiles of E-health Businesses.SNUH

  11. E-HEALTH CONTENT: 3 MAIN APPLICATIONS • Description • Examples • Customer information portals • Web-based services to simplify and enhance information access, communications, and training for physicians • Medscape.com • Physicians’ online • Stanford SHINE • Medsite.com • Physician/Healthcare professional services • Content • Health plan/Hospital services Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  12. CONTENT – PHYSICIAN/HEALTHCARE PROFESSIONAL SERVICES EXAMPLE: MEDSCAPE.COM Company Snapshot Ownership: Public (Nasdaq: MSCP), Proposed merger with MedicaLogic Industry: Healthcare online content providers Market cap: $145.1 million 1999 Revenues: $11.2 million Other: Boasts 1.7 million registered members worldwide • Description • Physician-focused portal and content site designed to educate health care professionals with reference materials, educational programs, tools, and services • Features include: • Integrated search engine to retrieve abstracts and full-text peer reviewed clinical medicine articles from +500 leading medical publications • Next-day conference summaries • Medscape General Medicine: Internet’s first primary source medical journal • Programs to earn CME credit • Daily and weekly specialty newsletters • Personal physician websites • Money & Medicine: Online financial resource center • Medscape bookstore • Specialty site for medical students • “Palm Docs”: Downloadable Palm organizer tools and resources • Value Proposition • Largest single source of articles and news on health topics • “Palm Docs” enables physicians to create and retrieve information in ways that fit into their workflow • Business Model • Revenue primarily generated through: • Advertising and sponsorships • Market research • e-commerce • Member fees Key Issues Proposed merger with MedicaLogic will provide key technology for creating online health records • Strategic Relationships • Commerce: BarnesandNoble.com, Drugstore.com • Connectivity: Softwatch • Content: CBS, Healthcare Communications, MSNBC, National Data Corporation, Reuters Health Information, TMP Worldwide/Monster Board Source: Company financial report and website, Hoover’s, News clippings 0010.Profiles of E-health Businesses.SNUH

  13. E-HEALTH CONTENT: 3 MAIN APPLICATIONS • Description • Examples • Customer information portals • Physician/Healthcare professional services • Content • Web-based services to simplify and enhance information access and communications to hospital/health plan members • Kaiser Foundation Health Plan • Cigna • Health plan/Hospital services Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  14. CONTENT – HEALTH PLAN/HOSPITAL SERVICES EXAMPLE: KAISER PERMANENTE HEALTH PLANS Company Snapshot Launched: 1997 (www.kponline.org) Ownership: Nonprofit Industry: HMO/Health plans • Description • Nonprofit, public benefit corporations that contract with individuals and groups to arrange comprehensive medical and hospital services. KFHP, along with Kaiser Foundation Hospitals and the Permanente Medical Group, is a part of Kaiser Permanente • Internet features include: • Online doctor appointment registration • Online prescription refill requests • Advice nurse • Physician directory • Medical and disease information • Discussion groups • Health education classes • Value Proposition • Offers more member services and features than any of its HMO/health plan competitors • Business Model • Overall goal is cost control, not revenue generation • Strategic Relationships • Kaiser Permanente has 8.6 million members, creating a low-cost channel for driving adoption of services Source: Company website, News clippings, Jupiter Analyst Report 9/99 0010.Profiles of E-health Businesses.SNUH

  15. E-HEALTH COMMERCE: 3 MAIN APPLICATIONS • Description • Examples • Online selling of consumer health products • PlanetRX.com • CVS.com • DrugEmporium.com • Drugstore.com • Familymeds.com • RX.com • eNutrition.com • Healthshop.com • more.com • MotherNature.com • Greentree.com • vitaminshoppe.com • Business-to-consumer (health products) • Business-to-business • Commerce • Online insurance brokering Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  16. Description Retailer of prescription drugs, non-prescription drugs, personal care products, beauty and spa, vitamins, herbs, nutrition, and medical supplies Features include: • Expert consultations • Online communities with direct links to disease-specific websites (e.g., diabetes.com) • Shopping lists • Secure storage of customer’s prescription history • E-mail reminders • Newsletters • Drug and Interaction information COMMERCE – BUSINESS-TO-CONSUMER (HEALTH PRODUCTS) EXAMPLE: PLANETRX.COM Company Snapshot Launched: March 1999 Ownership: Public (Nasdaq: PLRX) Industry: Drug and Health Product Retailers Market Cap: $195.3 million 1999 Revenues: $9 million Other: Chairman’s choice recognition award - EARL Awards 2000, excellence in online and in-store retailing • Value Proposition • Convenient, 24/7 shopping with product selection that includes +28,000 SKUs • Recent alliance with ePhysician allows for doctors to transmit prescriptions via ePhysician technology to PlanetRx pharmacies • First e-commerce site to offer scanner functionalities, enabling customers to scan bar codes of products to purchase from the website • Business Model • Revenue primarily generated through: • Sales and related shipping costs • Strategic Relationships • Commerce: McKesson, HBOC, Bergen Brunswick • Portal: Women.com, AOL, Netscape, BabyCenter.com, Time, Inc., Yahoo!, iVillage • Content/services: FOX, Health Network, Healthcentral, DrugDigest.org, The American Society of Health-System Pharmacists, AllHealth.com, Medline • Key Issues • Acquisition of YourPharmacy.com completed key revenue strategy by becoming the exclusive online pharmacy to Express Scripts’ 36 million plan members for 5 years • Unlike its competitors, PlanetRx will have to build a brand name without the assistance of a consumer-branded partner Source: Company financial report and website, Hoover’s, News clippings, Jupiter Analyst Report 9/99 0010.Profiles of E-health Businesses.SNUH

  17. E-HEALTH COMMERCE: 3 MAIN APPLICATIONS • Description • Examples • Business-to-consumer (health products) • Business trading community for healthcare products and services • CimtekMedical • medibuy.com* • Neoforma.com* • Medline.com • Omnicell.com* • SciQuest.com • Proposed • Unnamed (J&J, GE Medical systems, Baxter International, Abbot labs, Medtronic)* • newhealthexchange.com (AmeriSource, Cardinal Health, Fisher Scientific, McKesson HBOC, Owens & Minor) • Business-to-business • Commerce • Online insurance brokering * Company descriptions provided in the following pages or in appendix Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  18. THE B2B WEB INFRASTRUCTURE AND SERVICES LANDSCAPE • The B2B landscape • Web enabling infrastructure • B2B Services • Web-based business process enabling systems • Description • Examples • Providers of web-based, XML-enabled purchasing automation software • PSM • Providers of web-based, XML-enabled logistics improvement software • SCM 0010.Profiles of E-health Businesses.SNUH

  19. B2B Services THE B2B WEB INFRASTRUCTURE AND SERVICES LANDSCAPE • The B2B landscape • Web enabling infrastructure • Web-based business process enabling systems • Software providers • Description • Examples • Firms facilitating management & delivery of website content • Content management • Providers of auctioning tools/software • Auction solutions • Providers of software that translate information from an internal computer system into XML, transport it across the internet, and finally reconfigure it into a format that can be understood by a partners’ system • XML-based application-integration 0010.Profiles of E-health Businesses.SNUH

  20. B2B Services THE B2B WEB INFRASTRUCTURE AND SERVICES LANDSCAPE • The B2B landscape • Web enabling infrastructure • Web-based business process enabling systems • Application service provider/ outsourcing agents • Software providers • Description • Examples • ASPs host software and provide other services to various companies for a fee • Clients avoid cost investments • Clients pay for services “as needed” • Third parties managing select functions in the web development process e.g., web hosting, fulfillment, billing etc. 0010.Profiles of E-health Businesses.SNUH

  21. Web enabling infrastructure THE B2B WEB INFRASTRUCTURE AND SERVICES LANDSCAPE • The B2B landscape • B2B Services • Auctions • Description • Examples • Tools/services to conduct real time, bulletin board, or sealed bid auctions 0010.Profiles of E-health Businesses.SNUH

  22. Web enabling infrastructure • Auctions THE B2B WEB INFRASTRUCTURE AND SERVICES LANDSCAPE • The B2B landscape • B2B Services • Aggregators • Description • Examples • Markets created by aggregating a number of suppliers and buyers 0010.Profiles of E-health Businesses.SNUH

  23. Web enabling infrastructure • Auctions • Aggregators THE B2B WEB INFRASTRUCTURE AND SERVICES LANDSCAPE • The B2B landscape • B2B Services • Exchanges • Description • Examples • Online market making by matching buy and sell orders between multiple suppliers and buyers 0010.Profiles of E-health Businesses.SNUH

  24. Web enabling infrastructure • Auctions • Aggregators • Exchanges THE B2B WEB INFRASTRUCTURE AND SERVICES LANDSCAPE • The B2B landscape • B2B Services • Communities • Description • Examples • Community of interest focused on vertical industry segments providing a forum for information sharing, news, and creating exchanges 0010.Profiles of E-health Businesses.SNUH

  25. THERE ARE ACTUALLY FOUR DIFFERENT SOURCES OF VALUE IN B2B COMMERCE • Opportunity for value • Drivers • Order processing • Sales, marketing, and customer service • Buyer search/purchasing • Standardize IT and business processes • Reduce interaction/ process costs • 1 • Optimize • Lean inventory management • Reduction in errors/rework • Enhanced production planning/yields • More efficient distribution • Reduce supply chain costs • 2 • Broad product/price information on availability, control over unauthorized buying • New market-making mechanisms, e.g., exchanges reverse auctions, demand aggregation • Increase market efficiency • 3 • Increase value capture from current customers • Reach new customers • Enable new products/services • Increase revenue • 4 0010.Profiles of E-health Businesses.SNUH

  26. Other commodities • Financial institutions • Service industry • Vehicles • Mini computers/PC • Refinery/ • energy • Electronics • Pharmacy THE PORTION OF RAW MATERIALS AND SERVICE PURCHASE IN TOTAL COSTS Cost of purchased materials and services Percent • 100% = Total costs • 80-85 • 85 • 80 • 75-80 • 70 • 50-60 • 50 • 40 • 60 • 30 Source: McKinsey estimates 0010.Profiles of E-health Businesses.SNUH

  27. Commodities • Specialties • Standardized products • Many suppliers • Tightly specified products • Few suppliers • “Grey zone” products MANY DIFFERENT TYPES OF PRODUCTS ARE TYPICALLY PURCHASED BY A COMPANY 0010.Profiles of E-health Businesses.SNUH

  28. Catalog sites • Aggregation tool • Exchanges DIFFERENT PURCHASING SOLUTIONS AND METHODS REQUIRED FOR DIFFERENT PRODUCT TYPES - TYPICAL OVERALL SAVINGS 25-30% • Commodities • Specialties • Standardized products • Many suppliers • Tightly specified products • Few suppliers • “Grey zone” products • Frequent “Spot” decisions • Immediate needs • Many purchasers • Online bidding to “negotiate” contract • “Strategic negotiation” with suppliers 0010.Profiles of E-health Businesses.SNUH

  29. COMMERCE – BUSINESS-TO-BUSINESS EXAMPLE: NEOFORMA.COM Company Snapshot Ownership: Public (Nasdaq: NEOF) Industry: Medical Products Distribution Market Cap: $485.8 million 1999 Revenues: $1 million Other: Announced merger with Eclipsys Corporation (provider of end-to-end health care information solutions) and HEALTHvision (provider of Web-based solutions to health care organizations), 3/2000 • Value Proposition • Multi-supplier marketplace for health care professionals (purchasing managers, administration, doctors) • Buyer enablement focus, managing shopping lists track buyer behavior to allow repeat one-click ordering • Business Model • Revenue primarily generated through: • Listing and transaction fees charged to suppliers for confirmed orders from shop • Commission from online auctions • Description • Provides B2B e-commerce services for medical products, supplies, and equipment • Features include: • Shop: 400,00- product listings from 13,000 suppliers across 10,000 categories; users can send e-mail RFQs • Auction: Online and live auctions, appraisals, and liquidation of >1,000 items of used, refurbished, and surplus equipment • Planning: Allows users to design a facility online - provides “shopping list” to address complexity and 3-D tour to visualize plan • Information: Regulatory library, trade, and customer resources, news personalized by specialty external links • Career: Job search and posting • Strategic Relationships • Partnering with SAP to integrate into mySAP.com marketplace - provides seamless link from SAP back-end to Neoforma • Partnered with Healtheon, MD On-Line.com, ECRI, University of Chicago’s Duchossois Center for Advanced Medicine, and World Telehealth • Purchased auction company, General Asset Recovery (8/99), to provide brick-and-mortar auctions • Key Issues • The medical products marketplace is highly fragmented, and estimated to be worth $140 million • Merger created exclusive 10-year deal with Novation LLC (product buying consortium for 6,500 hospitals worldwide) giving Neoforma.com access to 1/3 of all US hospitals • Lack of investor confidence over the recent announcement of planned acquisition of Eclipsys plummeted Neoforma.com share prices • J&J/GE Medical Systems announcement over global health care exchange venture is troubling because GE Medical Systems is a venture investor in Neoforma.com Source: Company financial report and website, Hoover’s, News clippings 0010.Profiles of E-health Businesses.SNUH

  30. E-HEALTH COMMERCE: 3 MAIN APPLICATIONS • Description • Examples • Business-to-consumer (health products) • Business-to-business • Commerce • Online selling of health insurance • eHealthInsurance.com • Channelpoint.com • Healthaxis.com • Online insurance brokering Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  31. B3. COMMERCE – ONLINE INSURANCE BROKER EXAMPLE: HEALTHAXIS.COM Company Snapshot Ownership: Public (Nasdaq: HAXS) Market Cap: $74.4 million 1999 Revenues: $77.5 Industry: Online health insurance • Value Proposition • Only e-health care company servicing both the consumer and B2B marketplaces • Business Model • Revenue primarily generated through: • Commission • Description • Provides internet solutions for health care insurance marketing, sales, and payor connectivity; end-to-end solutions for the health insurance industry • Features include: • Customer Services: online platform, allowing customers to shop for, buy, and service health care plans • Applications Solutions: Web-based software applications for transaction processing, internet enrollment, online access to plan and claims data, technology infrastructure management, and data capturing services • Strategic Relationships • Carrier Partners: Aetna US Healthcare, Blue Cross, Celtic, Fortis, Peoples Benefit, Provident, Security Life Insurance • Network Partners: First Health, CAREington, PCS Health Systems, Prudent Buyer PPO, Private HealthCare System • Affinity Partners: AOL, Lycos, CNET, Snap!, 98point6, SPAN, PersonalMD, NCA, Insurance.com, Care City, DOCSDepot.com, USA Rewards, Ask the Doctors, BizOffice.com, Student Advantage Source: Company website, News clippings 0010.Profiles of E-health Businesses.SNUH

  32. E-HEALTH CONNECTIVITY: 3 MAIN APPLICATIONS • Description • Examples • Connect providers and consumers with healthcare organizations, including payors, hospitals, laboratories, and pharmacies • CareInsite.com • Claimsnet.com • cybear • cymedix • Allscripts • proxymed.com • Transaction/practice management services • Online patient medical records • Connectivity • Online care services Source: McKinsey analysis 0010.Profiles of E-health Businesses.SNUH

  33. CONNECTIVITY – TRANSACTION PRACTICE MANAGEMENT SERVICES EXAMPLE: CAREINSITE.COM Company Snapshot Launched: February 1999 Ownership: Public (Nasdaq: CARI) Industry: Medical Practice Management and Services Market Cap: $1.8 billion 1999 Revenues: $1.4 million Other: Medical Manager Corporation, which was purchased by Healtheon/WebMD, owns 69% • Value Proposition • Integration of payor-specific benefit rules and guidelines with patient-specific information at the point of care serves to control costs and improve health care quality • Extensive management experience in clinical process automation, health care transaction processing, and benefit management • System built with existing, well-proven software and system interfaces (licensed Cerner technology) • Business Model • Revenue primarily generated through: • Sales and implementation services • Description • Provides health care network and e-commerce services to enable the exchange of clinical, administrative, and financial information among physicians and their patients, and affiliated health plans, providers, and suppliers • Services include: • Transaction • RxInsite: prescription communication • Laboratory communication • Managed care communication: claims, eligibility, referral and pre-certification authorization • Content • Messaging • Strategic Relationships • THINC • Cerner • Horizon Blue Cross Blue Shield • AOL • Key Issues • CareInsite has the right payor-focused model and a strong management team • Potential significant competition on the horizon with payors currently developing a competing consortium • CareInsite needs to aggressively develop a substantial customer base Source: Company financial report and website, Hoover’s, News clippings 0010.Profiles of E-health Businesses.SNUH

  34. E-HEALTH CONNECTIVITY: 3 MAIN APPLICATIONS • Description • Examples • Transaction/practice management services • Aggregate medical information from various sources to rebuild patient medical records • MedicaLogic.com • HealthMagic.com • WellMed • MedicalRecord.com • PersonalMD.com • Healinx.com • Online patient medical records • Connectivity • Online care services Source: McKinsey analysis 0010.Profiles of E-health Businesses.SNUH

  35. CONNECTIVITY – ONLINE PATIENT MEDICAL RECORD EXAMPLE: MEDICALOGIC.COM Company Snapshot Ownership: Public (Nasdaq: MDLI) Industry: Healthcare online content provider Market cap: $415.5 million 1999 Revenues: $19.7 million Other: Proposed merger with Medscape (Nasdaq: MSCP) • Value Proposition • E-health care products connect patients and physicians in a way that enhances quality, delivery, and cost-effectiveness • Business Model • Revenue primarily generated through: • Advertising and sponsorship through AboutMyHealth.net • Prepaid licensing and monthly fees from physicians • Description • Provides web-based storage and management of medical records, as well as related products and services • Products and services include: • Electronic medical records for physicians (Logician) • Personal health portfolio for consumers through AboutMyHealth.net • Health-related content and e-commerce • Internet health record for integration of physician’s electronic medical records and consumer’s personal health portfolio • Strategic Relationships • Alliances: LabCorp, to directly link lab results and corresponding EMRs, CVS.com, drugstore.com, PlanetRx.com, Envoy • Content: HealthGate • Customers: Baylor College of Medicine, Providence Health System, Oregon Health Sciences University, VHA, Wake Forest Baptist Medical Center • Key Issues • AboutMyHealth.net is still in beta test mode • Needs to quickly and aggressively expand its physician base in order to expand its customer base Source: Company financial report and website, Hoover’s, News clippings, Jupiter Analyst Report 9/99 0010.Profiles of E-health Businesses.SNUH

  36. E-HEALTH CONNECTIVITY: 3 MAIN APPLICATIONS • Description • Examples • Transaction/practice management services • Online patient medical records • Connectivity • Online consultations and Internet-enabled telemedicine services to customers • iPhysicianNet.com • Medwired • HealthHero.com • Alere.com • Online care services Source: McKinsey analysis 0010.Profiles of E-health Businesses.SNUH

  37. CONNECTIVITY – ONLINE CARE SERVICES EXAMPLE: iPHYSICIANET.COM Company Snapshot Ownership: Currently private, IPO filed Feb 2000 Industry: Internet-enabled health care services • Description • iPhysicianNet establishes a physical and internet-enabled electronic presence in physicians’ private offices, enhancing communication between pharmaceutical companies and physicians • Products and features include: • Interactive, real-time PC-based videoconferencing system • e-Detailing: real-time detailing, allowing pharmaceutical company sales reps to communicate directly with physicians in their private offices • High speed telecommunications lines • Value Proposition • Provides a cost-effective and efficient e-commerce communication channel between the pharmaceutical company and other health care professionals • Using iPhysicianNet.com can result in a five-fold increase in the number of effective detail calls by a pharmaceutical representative • Business Model • Revenue primarily generated through: • Services • Strategic Relationships • Connectivity: Hitachi Data Systems, x-ChangeMag.com, Axolotl, Rhythms NetConnections • Customers: GlaxoWellcome Key Issues Considering expansion into onsite medical conferencing, remote peer consultations, and other conferencing services Source: Company website, News clippings 0010.Profiles of E-health Businesses.SNUH

  38. CONNECTIVITY – OTHER EMERGING AREAS Broadband access and new voice and video over IP technologies will enable telemedicine and other virtual healthservice growth. • Private online education • Patient communities • Virtual personal clinics • Home testing/monitoring • Teleradiology • Telepathology • Telepsychiatry Source: Company website, News clippings 0010.Profiles of E-health Businesses.SNUH

  39. E-HEALTH AGGREGATOR: 2 MAIN APPLICATIONS • Description • Examples • Provide end-to-end solutions or combination of multiple services to various healthcare industry • Ventro.com • Horizontal • Aggregate • Vertical Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  40. HORIZONTAL AGGREGATOR EXAMPLE: VENTRO.COM Company Snapshot Ownership: Public (Nasdaq: VNTR), Formerly Chemdex Corporation Industry: Multi-sector internet marketplace companies Market cap: $1.1 billion 1999 Revenues: $30.8 million Other: Ventro is the parent company to 5 online companies - Chemdex (specialty chemicals in life sciences), Amphire (food services), Promedix (specialty medical items), Broadlane (health care supplies), and Industria (process-plant supplies) • Value Proposition • Different approach to e-commerce, focusing on end-to-end solutions tied to hospital ERP systems, rather than just a website making ordering and inventory management more efficient • Lower sales and marketing costs, as well as improved inventory management and product delivery for suppliers • Streamline business processes, increase productivity, and reduce costs throughout the supply chain • Business Model • Revenue primarily generated through: • Resale of products • Commission from sales • Description • Builder and operator of vertical B2B e-commerce marketplace companies; Purchases products from suppliers and resells them to customers • Products/services include advanced search engines, transaction software, and systems integration capabilities • Health care-related companies: • Promedix: customers purchase products from medical product manufacturers with a single purchase order; 500 specialty suppliers represent over 325,000 SKUs • Broadlane: high volume hospital and medical supplies, still in the development phase • Strategic Relationships (for Broadlane and Promedix) • Tenet Healthcare/ Buypower (JV to form Broadlane, exclusive purchasing agreement with Promedix) • Connectivity: VWR, Commerce One, Concur Technologies, IBM, Ariba, SAP • Recently acquired SpecialtyMD.com • Key Issues • Strong management team • Key to success will be to rapidly expand hospital/ GPO base. However, hospitals and GPOs may be reluctant to share pricing • Critics say that Ventro focuses too much on back-end solutions, thereby underselling the importance of front-end features • Market is waiting for Ventro to prove its model Source: Company financial report and website, Hoover’s, News clippings 0010.Profiles of E-health Businesses.SNUH

  41. E-HEALTH AGGREGATOR: 2 MAIN APPLICATIONS • Description • Examples • Horizontal • Aggregate • Provide end-to-end solutions or combination of multiple services across the healthcare industry • Healtheon.com • Vertical Source: McKinsey analysis, News clippings 0010.Profiles of E-health Businesses.SNUH

  42. VERTICAL AGGREGATOR EXAMPLE: HEALTHEON / WEBMD.COM Company Snapshot Integrated website launched: Nov 1999 Ownership: Public (Nasdaq: HLTH) Industry: Vertical Internet solutions, Internet and Intranet Software Services, Healthcare online content Provider Market cap: $3.5 billion 1999 Revenues: $102.1 million • Description • Healtheon:Uses an internet-based information and transaction platform to create Virtual Healthcare Networks (VHNs) that facilitate and streamline interactions among participants in the healthcare industry (i.e., providers, payors, employers, laboratories, pharmacies, patients) Services include enrollment and eligibility determination, referrals and authorizations, laboratory and diagnostic test ordering, clinical data retrieval and claims processing • WebMD: Provides physicians with administrative transaction services, medical new s and research, CME credit, customized web sites and e-mail accounts, and career services (WebMD Practice). Provides customers with free health and wellness news and information, support communities, interactive tools, and online shopping (WebMD Health) • Value Proposition • Community for physicians, health care professionals, and consumers • Offers both information exchange as well as support for complex transactions for disparate participants across geographic boundaries • Offers freedom from expensive proprietary systems and technology • Business Model • Revenue primarily generated through: • Non-internet, network-based transaction services, development, consulting, and IT management services • Software licensing fees Advertising • Subscription fees • Strategic Relationships • Recently acquired Kinetra, pending acquisition of Medical Manager and CareInsite, OnHealth.com • See attached pages • Key Issues • Healtheon/WebMD has a first-mover advantage, an attractive service-based business model, an experienced management team, and key strategic partners • Substantial increased competition has been posed by established technology companies and fast internet start-ups • Execution is in question, due to the rapid acquisition of different immature and untested business models • Dependent on a few major partners and customers for large percentage of revenues Source: Company financial report and website, Hoover’s, News clippings, Goldman Sachs 0010.Profiles of E-health Businesses.SNUH

  43. MARKET CAP RANGES FOR VARIOUS E-HEALTH BUSINESS APPLICATIONS* • Market cap (in $100 millions) 1 2 3 4 5 6 7 8 9 10 20 35 • Customer information portals • Physician/Healthcare professional services • Content • N/A • Health plan/Hospital services • Business-to-consumer (health products) • Specific • Commerce • Business-to-business • Online insurance brokering • Transaction/practice management services • Connectivity • Online patient medical records • N/A • Online care services • Horizontal • Aggregate • Vertical * First quarter, 2000 Source: McKinsey analysis, Hoover’s 0010.Profiles of E-health Businesses.SNUH

  44. KEY MESSAGES • E-health business growth has been driven by the high degree of industry fragmentation, interaction costs and consumer/provider demand • A broad range of e-health business have emerged that facilitate efficient interchange of content, commerce and interconnectivity • Significant opportunity exists for the development of high value e-health businesses in Korea 0010.Profiles of E-health Businesses.SNUH

  45. CURRENT E-HEALTH COMPANIES IN KOREA Concentration of e-health activity • Select Companies / websites • HealthOK , DrCyber, Crezio, Medion, Doctor21, Webhospital, Healthcare, Healthpia, InternetPost, HealthInfo, HealthKorea, DoctorKorea • Customer information portals • Physician/Healthcare professional services • Content • Health plan/Hospital services • Kimsonline, MediGate, Opendoctors, MediKorea, Medipark*, Mdhouse, MediNPharm • Business-to-consumer (health products) • Specific • Commerce • Business-to-business • Online insurance brokering • emedicals • Transaction/practice management services • Online patient medical records • Connectivity • Online care services • Horizontal • Aggregate • Carecamp • Vertical Source: McKinsey analysis, Websites, News clippings 0010.Profiles of E-health Businesses.SNUH

  46. E-HEALTH OFFERINGS BY SELECTIVE HOSPITALS AND MEDICAL CENTERS IN KOREA • Information and services offered • Hospital/Medical center • Service Information • Health Information • Hospital/Medical center • Reservation Services • Patient Queries • ü • ü • ü • Kyungpook University Medical Center • ü • ü • Kangnung Hospital, Asan Foundation • ü • ü • Kangnam Sungshim Hospital, Hallym University Medical center • ü • ü • ü • ü • Kyunghee University Medical Center • ü • ü • ü • Ahnam Hospital, Korea University Medical Center • ü • ü • ü • Severance Hospital • ü • ü • Ghil Hospital, Ghachun Medical University • ü • ü • ü • Asan Medical Center • ü • ü • ü • ü • Samsung Medical Center • ü • ü • ü • Kangnam St. Mary’s Hospital, The Catholic University Medical Center • ü • ü • ü • Hanyang University Medical Center Source: Websites 0010.Profiles of E-health Businesses.SNUH

  47. CONTENT – CUSTOMER INFORMATION PORTAL EXAMPLE: HEALTHOK.CO.KR Company Snapshot Launched: 1/2000 Ownership: SK Corporation Industry: Online healthcare content provider Other: HealthOK is a part of the OKcashbag business by SK Corp • Description • Customer-focused health care information • Features include: • OK Clinic: Information regarding symptoms and treatment for ~140 diseases and illnesses; online health care professionals answer patient queries • Healthmall • Ask the pharmacist • Specific health-related topics (e.g., diabetes, vitamins) • Healthfinder: Provides links ~1,800 health care-related sites • Clinic and pharmacy directories • CyberER • Post office • Business Model • Revenue primarily generated through: • Advertisement • Membership • Commission from commerce • Online marketing • Sales (e.g., through providing internet solutions for pharmacies) • Strategic Relationships • Connectivity: Oracle, Netro21 • Content: Mediservice, Korea Vitamin Information Center, Roche Korea, Cell Biotech • Customers: OnnuriHealth (drugstore chain) Key Issues HealthOK, along with PharmOK, are currently SK Corp’s main e-health businesses Source: Company website, News clippings 0010.Profiles of E-health Businesses.SNUH

  48. CONTENT – PHYSICIAN/HEALTHCARE PROFESSIONAL SERVICES EXAMPLE: MEDIPARK.COM Company Snapshot Launched: 3/2000 Ownership: M2 Community Industry: Online healthcare content provider Other: Medipark is a spin-off business of Medison (Korean medical device manufacturer); Majority investors include Medison, Medidas, Onnet, Terasource Venture Capital • Description • Information portal for physicians and other healthcare professionals • Features include: • Online library • Training, lectures, and conferences • Personal member websites • E-mail services • Customized news • Cyber communities • Value Proposition • One-stop internet services for physicians and other health care professionals • Provides the latest medical information • Provides links to relevant academic associations • Business Model • Revenue primarily generated through: • Advertisement • Management/ operations contracts • Strategic Relationships • Connectivity: Onnet • Content and connectivity: 16 medical professional associations Key Issues Company admits that the business model of Medipark.com is not to generate revenue but to create substantial network of physicians which can be used for other businesses Source: Company website, News clippings 0010.Profiles of E-health Businesses.SNUH

  49. COMMERCE – BUSINESS-TO-BUSINESS EXAMPLE: eMEDICALS.CO.KR Company Snapshot Announced: 12/99 Ownership: SK Global Industry: Medical products distribution • Description • Medical product distributions and clinical testing service for small, mid-sized hospitals • Features include: • Product purchasing • Inventory management • Management analysis • Automatic ordering • Electronic settlement • Online laboratory tests • Value Proposition • High quality medical products at lower price enabled by integrating telecommunication technology and distribution network • Guaranteed quality product/outcome backed by highly recognized SK brand • Efficient process management through proprietary program which can be installed to any existing system • Possible delivery of products within 24 hours • Business Model • Revenue primarily generated through: • Commission from sales • Advertisements • Strategic Relationships • Connectivity: Bit Computer, Brain Consulting, Medidas, SCL • Exclusive contract with 3M Korea • SK Global sponsors MediGate, the online doctors community • Key Issues • Catalog information available through website, but customers are required to use proprietary software for services • Business is still in the nascent stage of development • Currently limited offering with only one manufacturer per product Source: Company website, News clippings 0010.Profiles of E-health Businesses.SNUH

  50. VERTICAL AGGREGATOR EXAMPLE: CARECAMP.COM Company Snapshot Launched: 4/2000 Ownership: Currently private Industry: Vertical Internet Solutions Other: Majority investor is Samsung Corporation with 53%; carecamp.com owns 50% of Medipharm (chain of 1300 drugstores) • Description • Provides B2B e-commerce solutions, as well as health and disease information for physicians • Proposed features include: • E-marketplace: provides opportunity for hospitals, drugstores, medical wholesalers, and retailers to purchase and sell medical equipment and supplies through auctions • Telemedicine: online care services linking members and “cyber doctors” • Cyber hospital: health and disease information accessible to members, physician communities • Online shopping: health products and beauty supplies • Value Proposition • High quality medical supplies at lower prices • Business Model • Revenue primarily generated through: • Advertising • Commission • Membership fees • Strategic Relationships • Samsung Corporation, Unitel, Medimedia, Medicamp, Gil Medical Center, Soonchunhyang University Hospital, Hallym University Medical Center, Cha General Hospital, Paik Hospital • GE Medical, Medimedia Korea (Vivendi) Key Issues Business is still under development Source: Company website, News clippings 0010.Profiles of E-health Businesses.SNUH

More Related