PESTLE

Five year forecast healthcare technology

Although a lot will happen in the next five years regarding technology used in healthcare, to some it will seem like small beer. An annual 2% decline in patents in medical technology makes it less likely that some stunning breakthrough will arrive soon. Although patent activity is more promising in biotechnology and pharmaceuticals, business and politics conspire against us all in these fields. Hope I'm wrong...

Both the EU and the US will be focussing on interoperable healthcare records and more efficient data interchange. Expect breakthroughs in areas like greater use of software to detect potentential drug interactions and improvements in automated diagnostic tools. This is important and will save lives, as will improved communications between health care stakeholders.

Many improvements will feed through into healthcare after being invented and piloted outside of healthcare environments. This will include the routinely miraculous improvements in ICT efficiencies overall, but pay special attention to work being done in voice recognition software and automated translation tools, which will further improve communications.

Assisted living should get easier on a steady curve, with more intelligent devices to summon care and take care of household logistics, mostly via the internet. And stay tuned for surprises from the world of robotics--there may be domestic robots used in healthcare, both off hospital grounds and in the wards themselves.

Nanotechnology will play its part, mostly in terms of coating materials for stents, implants and devices, but to a certain extent in drug deliveries--but the major breakthroughs in that seem further out than five years.

Genetics and biotechnology will continue their tortuous mating dance with pharmaceuticals, but the courtship will be painful and the adjustment period long. Individual advances will continue to go unexploited and we will all continue to hold our breaths waiting for the big one. Maybe 10 years out. Maybe 20.

Overall good news, solid improvements--but everyone in the developed world is waiting for the big one. Not this time around.

Choices, technology and healthcare (4)

The great ICT explosion of the past 25 years did not happen because of one invention or innovation. It was literally thousands of incremental improvements in circuit design, chip fabrication, software, batteries, fans, mobile technology, etc., etc., that have created this new world.

The same will be true in healthcare technology--if we let it. At the Kaiser Family Foundation website, we find this:How Changes in Medical Technology Affect Health Care Costs

"Heart disease and its consequence, heart attack, is the leading cause of death in the U.S. and a good example of how new technology has changed the treatment and prevention of a disease over time.  In the 1970s, cardiac care units were introduced, lidocaine was used to manage irregular heartbeat, beta-blockers were used to lower blood pressure in the first 3 hours after a heart attack, “clot buster” drugs began to be widely used, and coronary artery bypass surgery became more prevalent.  In the 1980s, blood-thinning agents were used after a heart attack to prevent reoccurrences, beta-blocker therapy evolved from short-term therapy immediately after a heart attack to maintenance therapy, and angioplasty (minimally invasive surgery) was used after heart attack patients were stable.  In the 1990s, more effective drugs were introduced to inhibit clot formation, angioplasty was used for treatment and revascularization along with stents to keep blood vessels open, cardiac rehabilitation programs were implemented sooner, and implantable cardiac defibrillators were used in certain patients with irregular heartbeats.  In the 2000s, better tests became available to diagnose heart attack, drug-eluting stents were used, and new drug strategies were developed (aspirin, ACE inhibitors, beta-blockers, statins) for long-term management of heart attack and potential heart attack patients.  From 1980-2000, the overall mortality rate from heart attack fell by almost half, from 345.2 to 186.0 per 100,000 persons." It wasn't any one thing that made the dramatic change--it was everything.

If you followed the ICT revolution, you would normally feel very optimistic about a similar path to revolution in healthcare. There is a robust community of suppliers and inventors, there are ample rewards for the winners, there are pathways to success being charted out--we should expect to see a power-law logarythmic curve to technology making us immortal, or something like this (from Ray Kurzweil, of course):

And yet. Somehow, as governments get more involved with healthcare (usually at the express request of their citizens), something seems to get lost. The overall number of medical technology patents declined by 2% annually between 2001 and 2005--the same period that saw a 5% annual increase in patents for optics, of all things. What incentives are being changed?

And yet. Countries tend to specialise in specific areas. It shouldn't surprise anyone to discover that Singapore, Japan and South Korea specialise in semi-conductors, for example. But consider France, a respectable generator of patents and overall research. They do good things there. But they punch above their weight in patents for telecommunications, and punch under their weight for medical technology, pharmaceuticals and biotechnology. What's up with that? The United States punches above its weight in all three, while countries with very active government involvement in healthcare are not really leading in healthcare innovation. 

If we provide direction and incentives to cut administrative costs and reduce paperwork, that's where companies will focus their efforts. Intel has a medical division that is working on a large variety of hugely useful products and services, but their big headline winner to date is a joint venture with MCA to produce a tablet PC that helps doctors and nurses... communicate better, reduce information friction and lower the administrative burden of hospitals. It's... worthy. It's valuable. But Intel was born to change the world, not improve on the tablet PC, dammit.

So when I do my five year forecast on this sector, I will be more cautious than hopeful. And that's a mortal pity--I think I'm going to need a few medical inventions to get to my 100th birthday.

Healthcare, Technology and Choices (2)

Why is President Obama trying to convince the world that making the right choices about technology in healthcare can make such a difference in the recovery of the American economy? Well, because he's right, at least from my point of view.

Before I examine evidence and give links, let me state my prior assumptions: First, that the changing demographic composition of the U.S. makes this the most appropriate time to make a major technology upgrade to healthcare. The retiring Baby Boomers (perhaps too aware of surface healthcare issues and perhaps a bit too worried about them) desperately need remote healthcare to avoid clogging up the physical plant of the healthcare system. The desire for assisted living by the Greatest Generation can better be met by remote monitoring and consultations. Meeting both of these 'patient' preferences head on could reduce inpatient and even outpatient admissions. Reducing admissions brings many, many big benefits--huge reduction in costs, blessed reduction in number of errors, lower need for capital expansion, and (importantly, but probably not something that is measured), lower external costs to families.

This is all before examing the potential effects of technology in record-keeping, staff communications, improved performance of wards and rooms, better prescribing practices and avoidance of both over-medicating and conflictual medicating, facilities maintenance, etc. And it is also before examining the potential for technology to help detect, delay and treat medical conditions.

You can see it's a big subject. In 2007, the U.S. spent $2.26 trillion on health care, or $7,439 per person. That's two thirds of the entire GDP of China. It's big enough that small improvements are worth pursuing, and large improvements amount to a holy grail. Currently, a large part of this comes from American companies, a tax on employment that makes them a) less likely to hire new workers and b) less competitive in the world-wide market place. There's a reason car companies have plants in Canada--the Canadian government pays the healthcare insurance costs, not the car companies.

Companies that can provide technology to make these improvements will not just save money for consumers, governments and insurance companies. They will also succeed themselves, and will become additional engines for economic growth--much of it by selling their solutions to the rest of the world.

Armed with these prejudices, let's survey the field. Okay, in the next few posts. It is Saturday morning...

Technology, healthcare and choices

Let's look at lung cancer. It is decreasing by 1.8% per year among men and increasing 0.5% per year among women, tracking cessation and adoption rates of 30 years ago quite closely. The overall cost of treating lung cancer was $9.6 billion in 2004, and you can bet it hasn't gotten cheaper since then. Again in 2004, 13.3% of all spending on cancer treatment was on lung cancer.

As 85% of lung cancers occur in smokers (and, sadly for me, in ex-smokers), lung cancer is the poster child for the theory that up to 70% of all cancers are behaviour-related--it is what we eat, drink and smoke that gives us more cancer than anything else.

Hence the healthcare dilemma: New technology will without doubt provide new treatments for lung cancer. But, these new treatments will be expensive. The most cost-effective way of eliminating lung cancer is by persuading people to not start smoking. The second most effective method is by persuading current smokers to quit smoking.

President Obama's healthcare plan intends to use technology to improve communications and reduce errors. But there will also be support for new research. Some of that research will be regarding cancer. So, the $64 billion question is, should research be focussed on changing behaviour or on finding new treatments for cancers? Obviously it will be both, but what should the proportions be?

Organised medicine wants the bulk of money to be spent on changing behaviour. The patient community and some technology providers want the bulk spent on improving treatment. There will probably not be enough to fully fund both. Is there a Solomon in the house?

Green Technology--part 1 of about a hundred and thirty two posts, I imagine

One symptom of the complicated nature of green technology can be seen in the fact that I assign four categories to this post--economic, environment, politics, and, only lastly technology.

Green technologies can be separated into the following categories:

Generative: Nuclear, biomass, biofuels, solar, wind, tide, and maybe more

Recuperative: Recycling, re-using, retrofitting for insulation, etc.

Distributive: Smart power grids, micro-generation, land-use policy, etc.

The stated goal of green technology is to displace fossil fuels. The politics is fraught. The economics is dubious. The technology needs work. And the environment is waiting.

Just some brief notes from the generative side of things:

This year, the US passed Germany and became the largest producer of wind power. Are people celebrating? Do people even know? Germany, meanwhile, is the largest subsidizer of solar power--in a land that is not famous for being sun-drenched. Do people know or care?

In 2005, the US used about 21% of all energy consumed, about 100 quadrillion BTUs. In 2007, about 7% of US energy production was renewable (mostly nuclear and hydroelectric). President Obama wants to double that in the next three years. This would involve either doubling the number of nuclear power plants, tripling the number of dams, increasing 100 fold the number of windmills and solar panels, or some combination thereof. It's a challenge.

The challenge got bigger when oil prices collapsed (and those who think they will bounce right back should be talking to Brazil's Petrobras about their production plans). And, as nuclear power plants and dams are both contentious and long-term in the planning, we are left contemplating the wind, the sun, biomass and, presumably, our navels.

It seems to me that it would take about the same effort as did gearing up military production for World War II. (This may not be a coincidence--many are writing about how WWII 'cured' the Great Depression).

Windmills cost several million dollars ($4.2 million in 2001, although prices may have declined. They may also have increased, as they are incorporating more technology.) Solar panels are cheaper. America has lots of sun. But any way you slice it, renewable energy doesn't double for $50 billion, the price I heard Obama give. Perhaps he wasn't including nuclear and hydroelectric in his initial calculations? I'll check for the next post.

More later.

Update: Well, the President didn't answer my questions in his speech, but here are the bullet points from the Obama-Biden Comprehensive New Energy Plan for America, published in August of 2008:

Provide short‐term relief to American families facing pain at the pump • Help create five million new jobs by strategically investing $150 billion over the next ten years to catalyze private efforts to build a clean energy future. • Within 10 years save more oil than we currently import from the Middle East and Venezuela combined • Put 1 million Plug‐In Hybrid cars – cars that can get up to 150 miles per gallon – on the road by 2015, cars that we will work to make sure are built here in America  • Ensure 10 percent of our electricity comes from renewable sources by 2012, and 25 percent by 2025 • Implement an economy‐wide cap‐and‐trade program to reduce greenhouse gas emissions 80 percent by 2050

I need to do some more digging, apparently.

Technology Trends 4

If I were speaking to you face to face, I would now put on a very serious look and speak very slowly.

The next five years will see more innovation and invention than the past 12. That covers the entire life of Google, as well as the invention of Facebook, Twitter, etc., on the web, and the explosion of mobile telephony, the iPod, mobile software as services, etc., in telecommunications. We will see an extra zero on the number of products using nanotechnology, RayBan (or equivalent) head mounted devices that give full computer screen capabilities, an explosion in E-books, and much, much more. Your mobile in 5 years will be more powerful than the latest desktop PC is today.

But the next five years will probably not see a silver bullet cure for cancer, Alzheimer's or heart disease. Nor will genetics provide a detailed future history of your medical outcomes.

Robotics will advance into your home, if not your office.

A child born in the next five years in the developed world will probably have a zero percent chance of ever being lost in his or her lifetime. He or she will at some point not be convinced that's a good thing.

This analysis is based on simple extrapolation of patent filings, and should be (still) considered conservative. The wild and crazy stuff is for another post.

Technology trends (2)

Think back to the year 2000--the new millenium, the Y2K bug, the looming internet bust. Can you remember what you thought and how you felt back then?

If someone had asked you to predict what technology areas would grow the fastest over the next five years, what would you have predicted? (I'm glad I didn't publish my thoughts then...)

The World Intellectual Property Organisation has kindly catalogued and tabled international patent activity for the years 2001-2005, and has even charted average annual growth.

Perhaps because of the Y2K bug, 2001 saw the absolute peak in patents filed for IT methods for management. There was an annual 10% drop in patent filings in this area over the next 5 years. Most other IT-related patent filings grew by about 5% per year, which is quite robust.

Chemistry did badly. In 11 categories, 8 saw absolute declines, including biotechnology. Only pharmaceuticals saw growth, and it was a paltry 1.7% per year. (In case you're wondering why all the big pharmaceutical companies are eating each other, it's because the IP cupboard is bare...)

Mechanical engineering didn't do much better. Of 8 categories, three showed negative growth and the other 5 grew slowly, with the exception of transport, which managed 3.8%.

So what was the overall winner? The biggest growth? The scientific advances that should now be showing up in the products and services we are buying today?

Second was optics, with 5% annual growth, and 103,390 patent filings in 2005. First, predictably, was computer technology, with 5.3% growth and 144,594 patent filings.

What this tells me as a back-of-the-envelope analyst is that Moore's Law will continue, that there's a bit of hype in biotech, that I don't want to own stock in pharmaceuticals, but the next generation of transportation equipment might change, for the better and the greener. Hasten the day.

Packaging new knowledge

This post is the 'background' post, designed to set the stage for a 5-year forecast of technology trends worldwide. There may be other 'background' posts--remember I'm trying to show my work.

New scientific or technological progress is often measured in discrete packages known as patent applications or academic publications. These are easy to count and give an idea of progress. It isn't perfect, as backlogs in patent offices, copycat patenting and publishing, etc., can throw the stats off a bit, but as these practices aren't new, one hopes that the overall measure of progress is valid.

Growth in the number of patents has, over the past 50 years, been dramatic--but largely driven by the adoption of patent regimes by new countries, such as China. But let's turn the lecture over to the World Intellectual Property Organisation (WIPO) for a moment:

"Worldwide patent activity increased by 4.9% between 2005 and 2006, mostly due to increased filings by applicants from China, the Republic of Korea and the United States of America

The total number of applications filed across the world in 2006 is estimated to be 1.76 million, representing a 4.9% increase from the previous year. Between 2005 and 2006, the number of filings worldwide by applicants from China, the Republic of Korea and the United States of America increased by 32.1%, 6.6% and 6.7% respectively

Patent applicants tend to come from a relatively small number of countries of origin. For example, applicants from Japan, the United States of America, the Republic of Korea, Germany and China accounted for 76% of total patent filings in 2006. Chinese residents increased their share of total worldwide patent filings from 1.8% to 7.3% between 2000 and 2006, mostly due to increases in domestic patent filings.

Although the number of patent applications filed across the world has increased at a steady pace, the rate of increase is less than the rate of increase observed for other economic indicators such as GDP and trade."

Hence my previous post saying that a 1% increase in CAGR in patents would have a dramatic effect on a number of important living conditions.

Keep it clear, keep it clean

One plank of President Obama's economic recovery plan involves investing in cleaner energy infrastructure and resources. It is good, common sense conservation that we should applaud vigorously. However, it is accompanied by serious discussion of targeting technologies and channeling investment into some things that are greener than they are good. This could be dangerous in a lot of ways--as our recent experience with ethanol subsidies shows, governments can mess things up when they decide to support a technology for political reasons.

And it's not just governments. General Electric, a hard-headed, intelligent organisation that has made profits in almost every way possible, made the decision a few years back to target the green market. If you look at their stock price over the time period since they made that decision, you have to wonder what prompted their decision. To be fair, the recession hammered their stock price along with everybody else's, and the green market may require patience--GE may yet be rewarded for this decision. As a stockholder, I certainly hope so. But I hope they won't be rewarded by misallocated government spending that is targeted by wrong assumptions. In the long run, that will benefit no-one.

We don't yet know what the best way to produce electricity will be in five years' time. It may be nuclear, wind, solar, natural gas, tidal... most likely some combination, which will require serious thought and good planning. We don't yet know the best way to power personal transportation five years out.

We do know how to insulate houses and reduce energy consumption in large buildings.

We do know how to stimulate and finance effective research into best practice regarding energy.

We do know how to reduce energy consumption.

We should start there and wait for science (and yes, market decisions) to lead government investment decisions down the road.

Magnificent Fictions

A quick look around should convince you that we are not created equal, and that we have not been endowed by our creator with certain inalienable rights, e.g., life, liberty and the pursuit of happiness. These magnificent fictions constitute a challenge to whatever gods there be, and are testimony to the great hearts of the founders of the American revolution. Salute.

So we'll have to create these rights for ourselves, and work on contracts with each other to render them unalienable. Sigh. A human's work is never done.

 

50-100 years down the road we will choose life in the form of the right genetic profile and uploads. Liberty, always having been a state of mind, will be a default state as mind becomes more autonomous. The pursuit of happiness will get the time and attention it deserves, not because we've run out of work to do, but because the work will be structured as part of the pursuit.

A post about technology can quickly leave science fiction in the dust, and it makes me glad that I've chosen a 5-year horizon for the forecasting here. Just quickly, then:

As always, in 5 years what's on the screamingly modern desktop today will be a ho-hum part of your mobile. 

Your mobile will be wearable.

Screens for your mobile and your e-reader will be sunglasses or butterfly fans.

Solar panels will be sculpture.

Nano-coatings for planes and cars will be about ready to leave the lab and streamline, protect and beautify transportation.

The first artificially designed life form will have a name.

Parents in South Korea will worry about their children forming too strong a bond with their domestic robot child-minders. Parents in America will realize it's a valid concern.

Some government will negotiate with a pharmaceutical company, offering 99 year patent protection for lifestyle drugs such as Rogaine and Viagra in exchange for the right to manufacture generic version of lifesaving drugs.

This is just chapter 1 of the tech story five years down the road. It's the conservative chapter, the one meant to convince you I'm making sober and rational assessments. It's the next chapter that starts to get weird.