The future of Health Care, the Digitisation of the Medtech Industry and Regulatory Update Mark Steedman, PhD 4th December 2018

About us Publications www.deloitte.co.uk/centreforhealthsolutions Established in 2011, the Centre is the independent research arm of Deloitte LLP’s healthcare and life sciences practices. Its role is to inform stakeholders across health care and life sciences about emerging trends, challenges, opportunities and examples of good practice. Using primary and secondary research and rigorous analysis to drive unique perspectives, the Centre seeks to be a trusted source for relevant, timely and reliable insights. www.deloitte.co.uk/centreforhealthsolutions blogs.deloitte.co.uk/health/ Publications

Global health care spending is projected to reach $8.7 trillion by 2020 Up from $7 trillion in 2015 Why? Aging and increasing populations Emerging market expansion Number of people aged over 65 has increased to more than 656 million, or 11.5% of the total population Advances in medical treatments Rising labor costs Why? Spending is expected to continue to be uneven Better medical care, people living longer Health care spending per person by 2021 Falling infant mortality rate Lowering rates of communicable diseases Diabetes expected to rise to 642 million people by 2040 due to: Rapid urbanization Sedentary lifestyles Changing diets Rising obesity levels $11,356 United States $53 Pakistan

Life Sciences and Healthcare Predictions 2022 The future awakens Life Sciences and Healthcare Predictions 2022

Six predictions for 2022 - both evolutionary and revolutionary 1 The quantified self is alive and well: The genome generation is more informed and engaged in managing their own health 2 The culture in health care is transformed by digital technologies: Smart health care is delivering more cost-effective patient-centred care 3 The life sciences industry is industrialised: Advanced cognitive technologies have improved the productivity, speed and compliance of core processes 4 Data is the new health care currency: Artificial intelligence and real-world evidence are unlocking value in health data 5 The future of medicine is here and now: Exponential advances in life-extending and precision therapies are improving outcomes 6 New entrants are disrupting health care: The boundaries between stakeholders have become increasingly blurred

The quantified self is alive and well 1 The quantified self is alive and well In 2022 The genome generation is more informed and engaged in managing their own health Evidence from today A 3-month programme to help you lose weight and change your lifestyle behaviours

The culture in health care is transformed by digital technologies 2 The culture in health care is transformed by digital technologies In 2022 Smart health care is delivering more cost-effective patient-centred care Evidence from today Mercy Virtual Care Center In 2017, Mercy enabled 1300 ICU patients who otherwise would have been expected to die, to return home, saving $50 million in health care costs.

The life sciences industry is industrialised 3 The life sciences industry is industrialised In 2022 Advanced cognitive technologies have improved productivity, speed and compliance of core processes Evidence from today A ‘Contract in a Day’ project optimises clinical contract cycles to enhance relationships with investigational sites - 40% reduction in effort to execute a contract cycle time down from around 8 weeks to 1-10 days Three phases of industrialisation are transforming the productivity in knowledge-based organisations

Data is the new health care currency 4 Data is the new health care currency In 2022 Artificial intelligence and real-world evidence are unlocking value in health data Evidence from today Over the past five years, the Broad Institute has been the largest producer of human genomic information in the world, producing data at a rate of one 30X human whole genome every 12 minutes. The group has processed more than 1.5 million samples from more than 1400 groups in over 50 countries.

The future of medicine is here and now 5 The future of medicine is here and now In 2022 Exponential advances in life-extending and precision therapies are improving outcomes Evidence from today CAR-T cell therapy marks a fundamental shift in cancer therapy Using CAR-T therapies to treat blood malignancies has shown response rates as high as 70-90 per cent, but further research is required to see if the technology will have similar success in treating solid tumours. Market forecasts estimate that the global CAR-T market will reach $10 billion within 10-15 years, with a further future market potential of $35-100 billion.

6 New entrants are disrupting health care In 2022 The boundaries between stakeholders have become increasingly blurred Evidence from today Tech giants are moving into health care Amazon is said to be launching a new health care lab called 1492, focusing on improving interoperability and building out its Alexa voice assistant product suite to address health-related use cases The Apple Watch®, CareKit®, and ResearchKit® initiatives are being used for research into chronic diseases and population health 23andMe and Google X research labs’ machine learning subsidiary DeepMind are expanding into R&D.

Conclusion Across all of six predictions there are three key enablers that are critical to the realisation of the prediction and will impact the pace of change: Adoption of new technology Acquisition of appropriate skills and talent A new approach to regulation Adopting these enablers should see the life sciences and health care industries survive and thrive.

Medtech and the Internet of Medical Things How connected medical devices are transforming health care

Report introduction IoMT ecosystem Our report focuses on how the IoMT is transforming medtech’s role in health care and the impact of the increased use of connected medical devices on medtech companies’ business and operating models.

Forecast by geography and component The IoMT market What is the current and future market size? Forecast by geography and component

Challenges and opportunities for medtech The 8 key systemic challenges and opportunities facing the medtech industry Challenges and opportunities for medtech improving the adoption of medical technology at scale developing an in-depth understanding of end users developing new funding, business and operating models understanding interoperability requirements maintaining cybersecurity successfully navigating regulatory change attracting digital talent and building digital capability maintaining trust in a digital age

Medtech’s role in transforming health care Collaboration Devices that benefit both patients and hospital providers Advanced analytics Joining the dots between connected medical devices and health care IT Business model transformation

A bold future for life sciences regulation Predictions 2025

Prediction 1: Regulators are globally aligned and coordinated

Prediction 2: Regulatory relationships are based on a ‘win-win’ approach

Prediction 3: Regulators successfully balance rapid assessment of innovation with real-time regulation

Prediction 4: A technology-enabled approach is driving the productivity and quality of regulation