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Investors for Health opens door to all serious emerging market investors

All emerging market health-care investors are welcome to join Investors for Health (I4H), a newish community of 30+ investors including development banks, private equity, venture capital and impact funds. The group aims to jointly focus on private healthcare development in emerging markets with a focus on equity and alignment with universal healthcare cover. It next meets at HBI 2020, April 20-22, London. Its formation reflects a quiet revolution in the role of for-profit healthcare and its importance in bridging the World Health Organisation’s estimated $686bn funding gap in low-and-middle-income countries to achieve the United Nation’s Sustainable Development Goal #3 (“Ensure healthy lives and promote well-being for all at all ages”).

The group was initiated by IFC, the private sector arm of the World Bank Group, the UK development bank CDC Group and an impact fund, the Rise Fund; and subsequently set up jointly by a community of over 30 investors (including development finance institutions, impact funds, private equity and venture funds).

Maina Sahi, Director Strategy, Health & Education, Africa & South Asia at CDC says: “I think there is a recognition that in most emerging markets, the private sector is already playing a role in supporting and supplementing public healthcare, as governments recognise that they cannot achieve SGD-3 without leveraging private sector capabilities. In this scenario, it is imperative that shapers of the private sector, which are investors, focus on building impact-driven enterprises.” Recognition of the role of for-profit healthcare reflects the fact that in many countries it represents half or more of all provision. She added: “Alongside public sector provision and not for profit, we recognise that for-profit has a role in provision.” Most national governments now also recognise this.

Chris McCahan, IFC’s Sector Lead for Healthcare, adds: “We are witnessing a proliferation of non-communicable diseases worldwide with insufficient public resources to address the costs. At the same time, the private sector is developing relevant innovative business models, increasingly leveraging new and promising technologies and partnering with governments to help meet the public health burden. From a healthcare investor standpoint, all of this creates opportunity, but also complexity. The Investors for Health community provides a platform for sharing learnings and challenges, for advocating the important role of the private sector within health systems, and for co-developing investment opportunities.”

Meetings also enable I4H members to pool their experience and discuss business models which work. “When we meet we can compare what we do and we can see where our investments fit in the constellation of healthcare,” said Sahi. “It enabled us to see the gaps.” This has led, for example, to thinking of leveraging larger urban hospitals and moving towards hub and spoke primary & tertiary healthcare models.

The group also exists to share innovation. Sahi said: “It is not as if we are a bunch of tech companies all secretly developing patents. We can share when our investee companies come up with innovations that work.” That covers everything from healthcare delivery, diagnostics, workforce, telehealth and digital health.

Another spur to cooperation has been the development of universal healthcare cover in countries like India, Indonesia and Kenya. “Often operators are unclear what the government policies really mean or how they will be rolled out. And that can be a recipe for inaction and non-participation.” She says it is much better when investors and investee companies can come together as a group and build a joint understanding as well as initiate action. This also allows them, where possible, to have a discussion with the government over where and how they can play a role.

I4H is now keen to engage with any investor in emerging market healthcare and to extend membership to them.

If you are interested to learn more and become a member, email contact@investorsforhealth.com. A good way to find out more I4H is to attend the next meeting which takes place at HBI 2020, April 20-22, London. For details of the HBI Policy Summit 2020, click here.

We would welcome your thoughts on this story. Email your views to David Farbrother or call 0207 183 3779.