By: Denis Barrier
At Cathay Innovation, everything we do is based on clear principles. One of which is working towards positive change and partnering with those committed to providing better ways of doing useful things through technology.
We are big believers in the digital revolution across industries including mobility, fintech, new retail and beyond. This is clearly demonstrated by our investments in companies pushing forward innovation in their fields such as Pinduoduo — taking China from e-commerce to the social commerce era; Chime — transforming banking and financial inclusion in the US; and Glovo — taking on-demand delivery to the next level in underserved regions such as South America, South West and Eastern Europe and Africa. Looking forward, we believe that Healthcare is the next major industry on the brink of a transformation that will have the largest economical outcome and impact for people in the coming decade.
Moreover, we believe that the future of startups, digital transformation of incumbent companies and the transition to a sustainable economy is converging. That’s why we partner with the global corporations leading their industries, to build an ecosystem where all players — from investors to startups to incumbents — can work together like never before. This is core to our thesis, combining the fast-moving world of Venture Capital with deep industry expertise to not only build market leaders but create a real impact.
Today, it’s with great pleasure that we can officially welcome globally leading biopharmaceutical company Sanofi as a strategic investor to our Fund and our latest corporate partner in the Cathay ecosystem. Sanofi is dedicated to supporting people through their health challenges and turning scientific innovation into healthcare solutions around the globe. This partnership not only allows Sanofi to strengthen its connection to innovation and health tech startups, but adds a powerful global ally in this essential industry to collaborate with the entrepreneurs, investors and executives in our ecosystem.
Investing in the Transformation of Healthcare
Innovation in the health sector is critical. Not only does healthcare have a huge impact on the economy, representing about 10% of GDP globally and 17% in the US alone, but it’s a unique domain in that the lives of people directly depend on it. In emerging markets, most countries suffer from an under-developed healthcare system, lacking the infrastructure, hospitals and doctors to meet demand. But even in developed countries such as America and China, there is much to be done to optimize care to improve everything from accessibility and patient care to medical research.
Despite being one of the most fundamental industries that supports the wellbeing of people everywhere, healthcare has long been in need of digital transformation. At Cathay, we see digital health evolution as an area of massive importance and opportunity for startups to apply technology and AI to address key issues such as improving drug development, lowering the barriers of access to healthcare while upgrading the efficiency, and evolving the entire system into the modern era.
- New AI-Driven Health Solutions & Drug Development
While traditional methods of drug development are becoming harder and harder, the rates of return have also decreased. With the introduction of AI to drug development (catapulted into the spotlight with the race for a COVID-19 vaccine), we can dramatically decrease the cost of discovery by finding more candidates at the top of the funnel, select them more efficiently, and get them through approval. The advancements in AI in this sector promises to increase the impact of the entire industry and be a step-change in how to discover and get better drugs to patients in need faster and at a lower cost.
For example, we were early investors in Owkin, an AI startup that integrates biomedical images, genomics and clinical data to discover biomarkers and mechanisms associated with diseases and treatment outcomes. We also invested in Inato, an AI-powered platform that accelerates clinical trials and enables pharmaceutical companies to reduce the time and costs behind drug development.
- Personalized Healthcare
Every person is unique so healthcare cannot be “one-size fits all.” The new solutions that combine advancements in treating diseases with AI with access to large pools of data can dramatically change the outcomes of modern medicine. First, the connection between one patient’s personal data and that of the wider population, can enable healthcare professionals to target treatments to a specific individual. Second, the ubiquitous connection of people, through technologies such as wearable devices, sensors or IoT, can better inform personalized predictive medicine, such as anticipating heart attacks, and help patients avoid potential health issues. The combination of AI and access to data will be a game changer in personalized medicine and care.
We’ve invested in innovative companies across the world revolutionizing personalized healthcare in various ways. This includes DayTwo, a microbiome precision medicine startup, specifically targeting diabetes, enabling consumers to take practical and immediate steps to improve their own health and wellbeing to prevent disease (rather than relying on a cure).
- Modernizing Healthcare Infrastructure & Recruitment
Access to affordable, efficient and personalized healthcare is an issue that impacts nearly all countries worldwide whether it be from barriers created by availability, cost or location (e.g., rural vs. urban areas or developed vs. emerging countries). But now we’re seeing major changes and innovative startups re-imagining everything from financial services and insurance that increases transparency and pricing to modern solutions that not only account for the massive shift in the future of work but accelerate digital transformation of the entire system. This will break down the silos of health data (i.e., claims, clinical, or genomic), resulting in lower costs via eliminating unnecessary administrative and overhead expenses, greater efficiency and overall better treatment.
One of our most recent investments was in Germany’s leading health-tech startup Medwing, a platform connecting workers with healthcare institutions and enabling professionals to simplify and streamline the application process to get a job tailored to their needs. Medwing sits at the crossroads of the future of work and digital health and drastically reduces the high costs associated with recruiting in the industry while also addressing an even more pressing issue — the massive skills gap of healthcare workers to meet demand. We’ve also backed an insurer in the US aimed at getting affordable, transparent, simple and personalized healthcare — particularly useful to the American middle class.
Taking Our Corporate Ecosystem in connection to innovative global ecosystems in healthcare, particularly in China
We are continuously impressed by the ingenuity of health tech founders and startups across the globe. But in order to accelerate further, transform the industry and improve healthcare for all, emerging startups need strong ecosystem partners with unparalleled knowledge, insights and expertise.
As a new investor in our Fund, Sanofi is taking our cross-industry platform to a new level. With a 360 degree tour across sectors, we now have even greater potential to create meaningful action such as global partnerships, business development and collaboration amongst cutting edge startups and established corporations.
China in particular has emerged as a top priority for Sanofi for its dynamic market development and rapid progress in innovation, demonstrating the potential of becoming a pioneer in the digitized economy. In this context, the strategic partnership will help us access the latest innovation in healthcare technologies which will ultimately translate into real benefits for the Chinese healthcare system along with the people of China and around the world.
Building on our strength of identifying visionary entrepreneurs that are inventing the fourth industrial revolution, we are convinced that we will develop a partnership of exceptional quality with Sanofi. We will work closely to leverage new emerging health trends by collaborating with the most promising startups in the health sector, to drive transformative innovation in the evolving healthcare ecosystem in China and globally