How to Solve Japan’s Innovation Bottleneck in Healthcare

Startups are changing how business is done in Japan, but medicine remains stubbornly resistant to innovation. In some ways, that's good. We are literally experimenting with peoples lives, so caution is definitely warranted. We don't want to rush things. However, Japan's national health insurance acts as a single buyer, and sometimes the only way to innovate is to go around them. That's exactly what Kenichi Ishii, the founder of Next Innovation has done. Their long-term strategy involves creating widespread and comprehensive telemedicine in Japan, but right now they have developed a basic approach that has reduced the cost of some medical treatments by more than 70% And business is booming. Ken and Next Innovation are both proudly from Osaka, and we also talk a lot about the state of the Osaka startup ecosystem. It's a great conversation, and I think you'll enjoy it. Show Notes Why medical startups need to innovate around Japan's national health insurance How to cross-sell in the medical market Why Osaka offers a competitive advantage to some kinds of startups What is holding back telemedicine in Japan The culture of secrecy in Japanese medicine The most likely source for innovation in Japanese medicine Links from the Founder Everything you ever wanted to know about Next Innovation Friend Ken on Facebook Check out the Sumashin app The Osaka Innovation Hub is the center of Osaka's startup scene [shareaholic app="share_buttons" id="7994466"] Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. The medical industry is one of the hardest to disrupt and in some ways, that's a good thing. I mean, we're literally experimenting with people's lives here so there's a good argument to be made for being conservative and taking things slowly, but you know, looking at the national health insurance system in Japan and the health systems of all developed nations, it becomes pretty obvious that not only can improvements be made but that improvements must be made. Well, today, we talk with Kenichi Ishii, the founder of Next Innovation. Their long-term strategy involves increasing the use and acceptance of telemedicine in Japan in general but right now, they've developed a basic approach to telemedicine that enables them to sell prescription drugs over the I, and business is booming. Oh, and Next Innovation is a proudly Osaka-based startup. Ken and I talk a lot about the challenges Osaka has faced in developing a startup ecosystem and why it seems that those problems might be over, and you'll be hearing from more and more Osaka startups on the show. During the interview, Ken and I talk about value-based medicine and price-based medicine. It's not really intuitive so it's probably best if I explain it to you now. When Ken talks about cost-based patients, he means those who see medical treatment as a means to an end and they want it done simply, cheaply, and quickly. The value-based patients are those that want to be involved either because of an interest in the treatment or for other social reasons that we’ll talk about. Ken will explain why this difference is important, how Japan's tight control over the medical industry forced him and his team to be very resourceful in launching this product, the crisis Japanese hospitals are facing now and why we can't stay on our current path; we need to innovate our way out of this situation. But you know, can tells that story much better than I can, so let's get right to the interview  [pro_ad_display_adzone id="1411"  info_text="Sponsored by"  font_color="grey"  ] [Interview] Tim: So I'm sitting here with Kenichi of Next Innovation, a true telemedicine startup in Japan. So thanks for sitting down with me. Kenichi: Thank you, nice to meet you. Tim: Telemedicine covers a really broad area,