The first time Nicolas Schulwitz addressed the subject of telemedicine before the German Medical Association, five years ago, they had a good laugh.
Mr. Schulwitz said back then, no one could imagine patients in Germany being cared for remotely via communications technology.
Now, the market is expected to double by 2020 and Mr. Schulwitz has just sold his start-up, Patientus, a provider of telemedicine, to Jameda for an unknown price. Jameda is Germany’s leading portal for patients to rate their doctors and belongs to Hubert Burda Media, the family-owned global media company which also publishes the German-language version of the Huffington Post.
German law doesn't yet allow doctors to only treat patients remotely. Physicians have to have seen them once personally before they can provide further consultation online or by phone.
According to a study by corporate consultancy Roland Berger, the global market for telemedicine will grow from $14 billion in 2016 to $26 billion by 2020.
“Jameda’s purchase of Patientus shows the potential telemedicine consultation is thought capable of in Germany. This acquisition will also give a boost to the market,” said Katharina Jünger, co-founder of Patientus-rival, Teleclinic. Her start-up, launched last summer, offers online video consultations with medical specialists, paid either by the patients or through pilot projects with healthcare plans and insurance companies.
German law doesn't yet allow doctors to only treat patients remotely, physicians have to have seen them once personally before they can provide further consultation online or over the phone. But now a new e-health law means from July onward, health insurers will offer and reimburse online consultation as part of the services they offer. For providers, this opens up a lucrative part of the healthcare market in Germany.
More and more health insurers are opening up to this area of care. Health insurer TK is working with Patientus while its Teleclinic is linking up with health insurers BKK Werra Meissner and Brandenburgische BKK. For people they insure, consultation by video is already free of charge.
Attitudes among patients is also changing, as a poll commissioned by health insurer TK shows. According to the Smart Health Study, 68 percent of respondents expect that in ten years, physicians will regularly care for their patients by phone, online chat, or by email.
Telemedicine offers advantages. Every winter, doctors' waiting rooms are packed with coughing patients, raising the risk of infection for those there for a checkup of a surgery scar or to discuss the results of their blood tests. For elderly patients, those less mobile or who live in remote rural areas, it's even harder to make the trip to the doctor's office.
In the United States, the United Kingdom and Sweden, the law permits remote consultancy with doctors. Digital health startups are flourishing there, from Doctor on Demand and American Well in the U.S. and Babylon Health and Doctor Ed in the United Kingdom. Medgate, a company in Switzerland, is now a leader in the country's healthcare system.
Compared to abroad, Germany is lagging behind, partly because of the restrictive legislation. Some companies are leaving the country, such as Klara, a Berlin start-up that created a digital application that enables doctor and patient communication.
Nicolas Schulwitz stayed. Together with Jonathan von Gratkowski and Christo Stoyanov, he founded Patientus in 2013 and now they have a ten-man team based in Berlin. Mr. Schulwitz, who studied economics, comes from a family of doctors and he used the doctors from his parents’ circle of friends as sparring partners to play around with his idea of digital consultancy. Later, once health insurer Die Techniker started pilot projects with physicians, Jameda was drawn to Patientus.
Burda Media bought physician rating portal Jameda in late 2015 for a price estimated at €47 million, or $49.4 million, at the time. Jameda’s annual sales are thought to reach €6 million. Each month, 5.5 million people use the site to check out how other patients rate their doctors. Doctors also use the portal to post pictures, their office hours and schedule appointments online.
In the future, they will also be able to consult patients via video. “Patientus perfectly complements our offering of doctor searches and online appointment booking,” said Jameda boss Florian Weiss. Patientus, on the other hand, not only gains the money it needs to further develop its product but also access to millions of patients and thousands of doctors. It would take enormous amounts of resources to build up that kind of reach otherwise, Mr. Schulwitz said.
The market is likely to become much more crowded especially given the new law, according to Teleclinic founder Katharina Jünger. Many expect regulations to be loosened even further in the near future and the internet pioneers are sure that the ban on remote consultation will be lifted completely, and that it's just a matter of time.
Miriam Schröder is based in Berlin and covers the city's start-up scene. Maike Telgheder is Handelsblatt's correspondent covering the pharma industry. To contact the authors: [email protected], [email protected]