[Enhance quality of life]
Contribution to Addressing a Variety of Different Medical Problems through the Building of a Healthcare Ecosystem
According to population estimates compiled by the United Nations, the world’s population will rise to around 9.7 billion people by the year 2050. The Asia region in particular will see a dramatic increase in healthcare costs, mainly because of the population growth and aging of the population structure resulting from rapid economic growth and increased average lifespan, as well as the impact of changing disease patterns. At the same time, there are many regions in Asia where there is a shortage of hospitals, and the number of hospitals where the level of medical treatment provided is up to international standards is still too low.
Mitsui & Co. established a Medical & Healthcare Division in 2008 to consolidate its medical and healthcare-related businesses and units. Today, Mitsui is involved in building new hospitals in regions where there is a shortage of medical facilities, using these hospitals as centers for developing related businesses such as specialist clinic operation, etc., undertaking the manufacturing and sales of pharmaceuticals and developing new drugs, providing medical talent referral services, and operating healthcare facility management and hospital catering businesses, and so on. By linking these different businesses together, Mitsui is building a healthcare ecosystem that contributes towards addressing a variety of different medical problems. Playing a core role in this healthcare ecosystem is IHH Healthcare Bhd. (IHH), Asia’s largest private hospital group with around 15,000 hospital beds in 12 countries. Mitsui first began investing in IHH and participating in its operations in 2011, and became IHH’s largest shareholder in 2019.
By realizing easier access to healthcare in different countries and regions, and by enhancing the quality and efficiency of medical treatment provision, Mitsui is contributing towards the building of a society in which optimal healthcare is delivered to the places where it is most needed.
Operating Asia’s largest private hospital business to help solve healthcare problems
When Mitsui first began to develop its healthcare business, there was a serious imbalance in supply and demand in the healthcare sector in Asia; while living standards had risen thanks to rapid economic growth, and the incidence of infectious diseases had declined, lifestyle diseases were becoming more common. With the aging of the population and the increase in the size of the middle class, demand for medical services was growing rapidly. However, despite the need for advanced medical treatment, by comparison with the situation in the advanced nations the number of hospital beds was inadequate, and many hospital environments were unsatisfactory from a quality perspective, creating a situation where it was not possible to deliver appropriate services to people in need of treatment.
IHH provided high-quality healthcare services that included highend, advanced medical treatment; it was one of the few private hospital groups in the Asia region that operated in multiple countries, and held very high market share in Singapore and Malaysia. In addition to its high market share, IHH's first-class medical environment and medical technology made it a respected company with a strong brand which patients trusted, and such strong brand also enabled IHH to attract and retain first-rate medical professionals that are in short supply in the Asia region. Given that IHH had the potential to realize a significant quantitative and qualitative enhancement of medical service provision, Mitsui chose to work through IHH to address the problem of the disparity between supply and demand in medical services, and decided to invest and participate in IHH management.
Following on from the initial investment in 2011, Mitsui has been contributing to IHH’s management from the inside by having seats on IHH’s board, and by assigning Mitsui staff to work at IHH. Besides providing support for stock market listing and for the establishment or purchase of new hospitals, etc., Mitsui also took a proactive stance towards providing introductions to potential local partners—particularly in India and China—to help IHH further expand the geographical scope of its operations. Such support being one of the reasons, the number of beds in IHH hospitals has grown approximately four-fold, and IHH’s valuation has risen around three-fold since 2011. Building on Mitsui’s experience in the healthcare business— including with IHH—Mitsui decided to increase its investment in IHH in 2019, and is taking a more proactive role in IHH’s management.
Of the challenges that IHH faces in the future, priority is being given to enhancing the value of the existing hospitals and implementing horizontal improvements across the company. The aim is to provide more efficient healthcare, by boosting sales through the development of higher-level services, optimizing the cost structure through centralized purchasing of pharmaceuticals, undertaking M&A activity and increasing the number of beds in existing hospitals, and so on.
In addition, by sharing information and cases across countries—for example, by sharing knowhow and best practice between hospitals—we aim to increase the opportunities to provide more advanced, more efficient medical services in countries throughout Asia.
Utilizing Big Data to provide each patient with optimal medical treatment
Mitsui’s goal is to build, strengthen, and expand a healthcare ecosystem. In a world where there are a wide variety of healthcare service providers, each playing an important role in their own specialist field, Mitsui is endeavoring to build large-scale medical infrastructure that links together the five key elements of locations, people, equipment, services and information, with hospitals playing the central role. The most important aspect is data utilization. IHH alone serves over 6 million outpatients and around 600,000 inpatients per year; if it were possible to effectively use not just this huge quantity of patient data, but also the data from the entire healthcare system, including ancillary businesses, then this should lead to the creation of immense value.
By proceeding with the building of an appropriate data platform, patient records and other data can be used as a basis for providing medical services that are tailored to meet patients’ needs such as disease management, remote diagnosis, and personalized medicine. In working towards the creation of these services, the first priority is to build the infrastructure needed for data acquisition, safeguarding and utilization, while also ensuring the anonymity of the data and strengthening data security. Once this has been achieved, we can proceed with measures to utilize data effectively and efficiently, while also identifying medical needs precisely. The ultimate goal is to provide more advanced medical services by integrating the collected data referred above with ancillary businesses, and to put the services on a sound commercial footing. We will be working steadily to realize the type of medical services that we are aiming at, over a 5–10 year time-frame.
Providing the world with sustainable medical services
Demand for medical and healthcare services in the Asia region continues to outstrip supply, and the key factors in the provision of medical services including hospitals, medical practitioners, medical information and so on are not always integrated in an efficient manner. We hope to efficiently re-allocate the unevenly distributed resources through the building of a healthcare ecosystem, aiming to eliminate the gap between supply and demand in this sector, and make medical service and healthcare provision sustainable. We believe that this will contribute to the enhancement and growth of society as a whole. Looking ahead to the future, Mitsui hopes to expand this kind of medical service provision on a global scale, cultivating the development of a business that will enhance access to healthcare for people all over the world.