Has New Zealand’s digital health sector fully capitalised on international opportunities for growth?
New Zealand’s digital health sector has shown tremendous growth in recent years. However, the question remains whether it has fully capitalised on international opportunities. Although the sector has made significant strides, particularly in exports and technological innovation, challenges remain in scaling these successes globally. In 2023, the sector generated $2.62 billion, a 2.4% increase from 2022. A majority of this growth is export-driven, with 89% of the sector's revenue coming from offshore markets, particularly the United States, which alone accounted for $1 billion.
While growth in some regions is robust, others lag behind. European and Asian markets have experienced declines of 6% and 9% respectively, perhaps indicating missed opportunities or competitive challenges. In Southeast Asia, for example, digital exports remain modest despite the region's fast-growing digital economy, which is projected to exceed USD$1 trillion by 2030. Efforts are being made to address these gaps.
New Zealand’s participation in international collaborations and strategic initiatives, such as the Horizon Europe programme showcases its ambition to engage in cutting-edge healthcare solutions. Groundbreaking projects like the development of digital twins, which are used to model personalised treatments in cardiovascular diseases, highlight our capabilities in applying advanced technologies to healthcare.
Additionally, the MedTech sector, worth $2.1 billion, has shown remarkable dynamism with over 200 companies addressing complex healthcare challenges. The government's support through initiatives like MedTech-iQ Aotearoa aims to accelerate the success of this sector, focusing on capturing a share of the $815 billion global medical device and digital health market.
To fully capitalise on international opportunities, we must address several challenges. Firstly, while the US market has been a major source of revenue, diversifying into underdeveloped markets like Southeast Asia could unlock further growth. This will require increased efforts in relationship-building, localisation, and understanding the complex regulatory environments of these regions. Secondly, the public health sector in NZ continues to rely on international providers for large-scale digital health solutions, limiting opportunities for local companies. A stronger emphasis on public-private collaboration and government support for local health IT businesses could bolster the sector's domestic foundations, making it more competitive internationally. Lastly, the digital health sector's innovation leadership in areas like AI-driven healthcare, wearables, and digital twins must continue to be leveraged. These technologies have the potential to transform healthcare delivery, and their successful global adoption could further cement New Zealand’s position as a leader in digital health.