Health and wellness – Canada’s prescription for a trillion-dollar global export opportunity?

Health and wellness – Canada’s prescription for a trillion-dollar global export opportunity?

The hospital in China’s Rizhao City seaport would seem to have little in common with a Winnipeg-based community hospital. 

Yet a partnership involving Winnipeg’s Wellness Institute at Seven Oaks General Hospital and Rizhao Hospital has led to a new approach to help China battle chronic diseases like diabetes and heart disease before they reach crisis levels.

Seven Oaks spokesperson Toby Maloney says the collaboration between the Wellness Institute, Rizhao City Hospital of Traditional Chinese Medicine, and the Rizhao City Economic Development Corp benefitted all parties.

China sought input from Seven Oaks as part of its aim to use preventive medicine to manage acute care costs related to chronic disease. In China, about 9.6 per cent of the country’s population – some 96 million people – now suffer from Type 2 diabetes, said Maloney.

A North American tour of health care facilities by Chinese hospitals introduced the Seven Oaks and Rizhao teams. Recognizing that Rizhao’s needs and goals aligned with Seven Oaks strengths, the two care facilities began discussing a joint project focused on chronic disease.

Despite strong alignment, the resulting collaboration brought operational challenges that both parties worked to address.

“Language has been a barrier, and there has been confusion at times, both when our personnel have been in China, and when we have offered training here in Winnipeg,” Maloney says.

To overcome language hurdles Seven Oaks translated a detailed manual on its Wellness Institute business model into Mandarin, explains Maloney. The Seven Oaks and Rizhao city counterparts then met in person and worked through an interpreter to discuss the modules. The Rizhao team then used the manual to train Chinese staff.

Maloney credits a collaborative mindset for keeping the process moving forward, and enabling both parties to benefit.

The big picture

Aligning common interests is just one factor helping grow what McKinsey & Co. predicts will soon become a “trillion- dollar” global business.

“Health and wellness is very wide and deep,” says Export Development Canada Global Director Antonio Lopes, who heads EDC’s sector team for the life sciences and healthcare cluster in Toronto.

Lopes estimates that at least 500 Canadian companies export health- and wellness-related products in sectors ranging from nutraceuticals (foods containing health-giving additives and having medicinal benefits) to dermatological and cosmetological products, and information technologies.

He says while the majority of Canadian products are exported to the United States—the world’s largest health and wellness products and services consumer market — Canadian exports also reach Western Europe, China, Brazil, the Andean region and elsewhere.

Meanwhile, the Middle East, especially Dubai and Saudi Arabia, is among the recently emerging markets for Canadian companies, notes Lopes. “Their shopping malls are all about high-quality products to improve health and well-being,” he says.

Canada’s brand a healthy advantage

Canada’s reputation for high-quality products – supported by Health Canada standards and Good Manufacturing Practice-certification – helps encourage demand for Canadian goods,” says Lopes.

Not surprisingly, in both developed and emerging economies, rising disposable income levels are the health and wellness industry’s major drivers, says Lopes, referring to evidence in two reports released in 2012—one by McKinsey and another by EY.

“With the developed world (Japan, Europe and to a lesser extent the U.S.) getting older, and emerging markets getting both bigger and richer, the market for things that make consumers healthier is set to expand,” states the McKinsey report.

Among its findings the McKinsey report notes three major trends exporters should pay attention to.

First, McKinsey says developed economies dominate spending while emerging ones dominate growth. The report cites 2006 figures showing the average Chinese person spent $60 U.S. annually on health compared to $580 U.S. by the average Canadian, a ratio of 1:10. But with rising spending rates in China, the gap is expected to shrink to 1:4 in 2017.

Second, with incomes rising in China and other emerging economies, traditional diseases such as polio and malaria are expected to fade, however, “lifestyle” diseases such as Type 2 diabetes and cardiac illnesses are increasing. The number of people aged 70 and older worldwide is also growing, with the UN projecting will grow top one billion by 2050.

Finally, McKinsey noted that global consumer habits are also changing, with 96 per cent of American Internet users researching health information, a trend that is fuelling health and wellness spending. North American appetite for alternative medicines is also growing, and now exceeds $16.4 billion—almost double Asia’s market.

Consumer health activism on the rise

For its part, EY’s Progressions 2012 Health care everywhere study noted that technology is influencing consumer health knowledge and activism.

According to EY, “Patients have grown increasingly comfortable with empowering technologies (e.g., smartphone apps, sensors, monitors, social media) and are taking a more active role in managing their health. They are demanding a different health care delivery model that will reach them wherever they happen to be.”

That is one of the guiding principles embraced by Greybox Solutions, a Quebec-based patient healthcare monitoring software and hardware solutions provider. Greybox founder Pierre Berube, a former manager at Canadian aircraft training systems manufacturer CAE, thought it remarkable that modern aircraft can take off and land on autopilot, but that relatively little had been done to use technology to remotely monitor patient care.

Greybox Solutions now sells its wares to private health clinics, and conducts research and development with large pharmaceutical companies. “Instead of bringing the patient to the clinic, we want to bring the services to the home and closer to the patient,” says Berube.

He says Greybox has benefited from working in partnership with brands such as Roche Diagnostics and others in the fields of rehabilitation and fall-prevention in the U.S.

“The United States is a big market for us,” he says, noting the company’s research and development strengths, and an advantageous Canadian dollar, help make it attractive to U.S. companies.

Berube says a track record of regulatory compliance in North America also helps open doors elsewhere in the world.

“You want to be sure your product is safe, reliable and in line with regulations. If you follow those guidelines, especially in the U.S., those products can be delivered into worldwide markets.”

A vital intersection of common interests

It was in this evolving world of health and wellness product supply and demand that Winnipeg’s Seven Oaks Hospital found its first export opportunity.

“We didn’t show up and tell people what to do,” notes Seven Oaks’ Toby Maloney. “We listened to what their interests are and asked them what they wanted to do.”

With assistance from Manitoba Trade and staff at the Canadian embassy in China, Seven Oaks foray into international trade paid off. The institute earned several hundred thousand dollars for helping design Rizhao’s programming and consulting services.

Buoyed by the Rizhao pilot success, Seven Oaks is now working on agreements with other hospitals in China.

A healthy start in an evolving world of opportunity to say the least.

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