Analysing healthtech spend with Tussell

Gus Tugendhat, founder of Tussell, a provider of data on public sector contracts, spoke to techUK on the latest findings from their research into procurement trends across the NHS in England.

Gus’ presentation was followed by a panel discussion, where we heard from:

Tom Slater, Commercial Director, NHS Digital
Charlotte Lee, UK Director, BigHealth
Tom Scott, Sales Director, Alcidion

Tussell analysed data from over 63, 000 invoices paid by healthcare bodies to tech companies since 2016, looking at three main areas.

The size of the healthtech market

Since 2016, healthcare spending on tech has grown by 17% annually, averaging £1.4 billion per year. NHS Trusts account for 53% of healthtech spend, though in practice spend increasingly goes through Integrated Care Systems (ICSs).

Tussell highlighted that, adjusting for population, tech spending per capita by London-based Trusts was three times greater than the amount in the North East of England. This insight suggests that initiatives designed to boost NHS trusts that are already doing well and help those falling behind are increasing disparities in quality of care.

Who is driving supply and demand?

Tussell have found that overall, the healthtech market is growing fast and disaggregating. While the average Trust spends £22 million per year on healthtech (9% of their non-clinical third-party procurement spending), more than half of this spending is going to the top 20 suppliers. However, these top suppliers have lost market share over the last 5 years, mostly to non-SMEs. It is likely this share of the market would have decreased even further had it not been for the COVID-19 pandemic.

Although there is a bias towards extending the existing contract, looking at these trends helps identify where it is worth pre-engaging with potential customers to make the case you can offer a better cost.

Where are the new business opportunities?

In total, there are 732 contract awards worth £595 million rolling off in the next 15 months.

The panel discussed spending on prevention versus spending on ‘sickness’, as it is likely that preventative spend will move increasingly to local authorities rather than CCGs. Although a focus on prevention is a high priority for Government, spending data indicates that the NHS still priorities reactive spending.

techUK’s recently published Ten Point Plan for Healthtech made a number of recommendations focusing on procurement, from signposting suppliers to existing frameworks to providing an accurate estimate for their total value and ensuring specialist training for staff buying technology. You can read the report to find out more here.