2023 review: the themes shaping year in the healthcare sector 

2023 has been a vital year for the medical industry as the world continued to transition out of Covid-19 restrictions and focus shifted to new horizons. The digital technology that took off during the pandemic has found its place even as many services have returned to in-person delivery. 

GlobalData’s analysts have shared their views on the most impactful themes of the year in healthcare, picking out four key areas that have influenced the sector. 

Perhaps inevitably, the first theme on our list is artificial intelligence (AI). From drug discovery to diagnostics, the technology has expanded possibilities across the industry. 

As GlobalData analysts Jemima Walker and Wafaa Hassan explain, “it would be remiss to not mention AI as an important theme from this year. In pharma this primarily revolves around drug discovery and development.”  

Medical analyst Alexandra Murdoch adds: “Generative AI is also quite big, especially because of conversational platforms and their use in medical.” 

GlobalData’s Artificial Intelligence in Drug Discovery report estimates that global AI revenue in the health sector will reach almost $21bn by 2025, with the largest segment being in hospitals and healthcare companies. 

Drug development, in particular, has the potential to be completely revolutionised through AI. Currently, drug development is time consuming and expensive, with only 10% of candidates making it to clinical trials. By training AI on genomic data and other patient information, it can sift through millions of possible targets and activations to find novel compounds that may help fight the disease. 

Precision and personalised medicine is another key theme from 2023. Walker and Hassan explain: “Cell and gene therapy has been a huge theme for this year, with groundbreaking approvals for rare diseases (for instance, Vyjuvek was approved for epidermolysis bullosa), and can be expected to continue into next year.” 

Precision and personalised medicine utilse advanced biomarker testing and gene sequencing techniques to allow drug companies to create therapies that better fit particular patient populations, as well as potentially facilitating cures for genetic diseases like dystrophic epidermolysis bullosa. A topical treatment approved by the FDA in 2023 can actually treat the disease rather than simply managing symptoms, which is all that had been possible before. 

Gene therapy, a particular type of personalised medicine, works by altering the genes of a patient. Using CRISPR technology, particular DNA sequences can be targeted and removed with extreme precision, offering unprecedented opportunities to cure both inheritable genetic diseases and previously untreatable cancers.  

Earlier this year, embattled bioscience giant Illumina led a $15m investment round into genomics startup Broken String Biosciences in the hopes of widening access to this technology. 

The downside to this treatment currently is that it is prohibitively expensive. Not only is it using technology that has not yet matured but the resulting therapies are also highly targeted to either a small population group or an individual, meaning that the cost of development cannot be spread across as large a patient population. This cost must often be borne by the patient who is to have the treatment, as there are currently no effective reimbursement agreements for the treatment between pharmaceutical companies and governments or insurance companies. 

Virtual care is an umbrella theme including topics like remote patient monitoring (RPM), telemedicine, virtual clinical trials and femtech. 

Murdoch explains that remote patient monitoring in particular “became popular quite quickly, thanks to the Covid-19 pandemic”. 

“It had a rapid adoption because of social distancing measures and hospitals becoming overwhelmed,” she explains. “That being said, RPM tools are still in use and will continue to grow in popularity because they provide so many benefits to patients and healthcare providers.” 

Remote patient monitoring has been shown to have benefits despite the return of in-person services, particularly for those suffering from chronic conditions. RPM devices, which can include specialised devices but also increasingly preexisting wearable tech like smart watches, allow doctors to monitor health data such as blood pressure, blood sugar levels and heart rate. 

This can improve patient care by catching potential issues early and conversely facilitate early discharge as doctors know they can monitor vital signs without the need for hospitalization. 

GlobalData’s Remote Patient Monitoring Devices report estimates that by 2030 the market will be worth $760m, though this is only a compound annual growth rate of 3.3% from 2020 as much of the massive growth in the sector happened during the pandemic. 

The field of digital therapeutics (DTx), explain Walker and Hassan, has been a hot topic this year in healthcare, but primarily because of the bankruptcy of the industry pioneer Pear Therapeutics in March/April. Pear Therapeutics went from going public via a SPAC for a combined entity of $1.6bn in 2021, to its products being sold at auction in 2023 for a total of $6m.

DTx promise the possibility of low-cost treatments for psychological conditions via smartphones, apps and other digital technology. Pear Therapeutics, in particular, focused on substance abuse disorder, which is notoriously difficult to treat. Some have argued that this was a large reason for the company’s failure, but insurance providers in the US were also loath to cover the relatively new treatment. 

Walker and Hassan explain: “Once heralded as the solution to many of healthcare’s problems, the DTx market is facing challenges that are stemming its growth. These challenges include, but are not limited to, uncertainty regarding the value of DTx, lengthy reimbursement processes, unstable market conditions, and a lack of regulatory and reimbursement pathways.”