30 thousand billion toman blocked health market
Founders and co-founders of 6 startups in the field of Health in Iran, are gathered together in Shanbe magazine office to talk about startup challenges.
The problems in the field of health startups can be examined in five levels; startups themselves, investors, regulatory, government and culture of use.
Founders and co-founders of 6 startups in the field of Health in Iran, that are Sogol SabetFar from Shafajoo, Ehsan Noori from TeleTeb, Farzad Riani from Salamat Gostar Sharif, Dr. Mahmood Fattahi from Salam Doctor, Mohammadreza Hemmati from AveSinap and Mohsen Sadr from Darmankadeh, are gathered together in Shanbe magazine office to talk about startup challenges.
That physicians don’t like to record the number of their visits, investors don’t accept the risk of being in this unsafe field, Health System has blocked the way for startup youngsters.
Recording health data is prohibited, everyone claims an amount of money to open the way for startups and if we are late and don’t open the way for domestic activists, multinational startups would dominate this field.
Act as a startup in the field of Iran health means being in a slow, lazy and public path in which there are pretenders like Medical Council, Ministry of Health, Social Security Organization, the FDA and several other organizations, but the main custodian of this field in terms of administrative trends is not known. On the other hand, there are sensitivities about health of society and statistics and figures in this field. I think it’s better to start our conversation with your incentives for entering this market and challenges you faced.
Fattahi: this field has many special characteristics. At first glance the health and wellbeing of human resources is a vital factor of sustainable development.
When we want to turn the slow wheel of this field with IT, we should have access to information about people’s health and processed statistics.
But we face many sensitivities in this area because they are considered security information. According to public organizations and the law, only a physician can interfere in the field of health.
Thus they have guards towards startups. When we talk with authorities, we usually hear such sentences: you aren’t qualified and you can’t enter this field.
In fact they don’t know IT and startup and that where we are going to stand in this regard.
For example, when we wanted to develop Salam Doctor, during a meeting with head of IT department of ministry of health, I explained my field of business and my intention and asked him to guide me about all the licenses required for entering this field.
They said that we don’t have any license and rules for this field. However they accepted that there are 30,000 active health system in the country which sell some products banned by ministry of health.
They were going to launch the accreditation center of health media known as Mars in 1394 which has not done yet.
Thus I, as a person who is a member of both medical community and startup ecosystem, has concluded to move forward based on current rules. Because looking for coordination and getting license is pointless.
Noori: when we as startups enter each field and our slow system of our country tries to define a law for it, issue license and etc.
We would become consumers in this field just like many other fields in which we are consumers. On the other hand, health data which are private should be accessed by foreign founders.
Thus the best way is to trust domestic activists. Unfortunately because of such deficits and lack of interest in updating processes, if we wait for this bureaucracy, more undesired consequences in this field would occur.
Even in the delay for making appointments or wrong selection of physician, people may die and there would be more disasters. Startups are good options which can prevent such disasters.
I mention the process because the path which leads to examination and treatment have other happenings around and we want to simplify this process so that patients can have access to their required physician more easily.
But physicians and medical system see all these issues in one unit and have crossed redline around themselves and don’t let others in.
while we don’t want to replace a professional physician with anything. We just want people to feel better.
What is their problem? Why don’t they understand you?
Noori: we don’t know. We apply a plan based on current models in the world and standards that can be followed.
I think what has happened to Snapp and Tap30 and taxi service organization would happen to us and organizations related to health and medicine soon.
But anyway we have to move forward and operate as many practical and facilitating options as we can so that tired, slow and old systems of government became obliged to cooperate with us.
Riani: the tension between current systems should be as least as possible so that we can work. Even physicians are stressful about the fact that if they use our programs, their current system would become defaced.
On the other hand, the ministry has projects like Sepas and Shams which would stand against us at the end. Generally, systems in the field of health around the world have such resistance against IT.
On the contrary, banking system with high volume of transactions has used IT for many years. But because data in this field is personal, private and diverse, we face such issues.
Do you mean that big startups in the field of health have not formed in other countries?
Riani: if they have formed, it was related to recent years and they haven’t grown as much as startups in other fields.
Especially they are studying extensively for launching health startups in developing countries. For example, in Malaysia a group of Iranians have launched a startup.
They are fewer in Europe and the number of startups in this field is more in USA.
SabetFar: My insight towards these challenges is different. We move forward up to the limit that law allows us.
If we think that we have the ability to progress, we force the legislator to impose new rules. I would mention to ShafaJoo.
We talked to 600 physicians about our idea 80 percent of whom agreed to use our services. When we launched ShafaJoo and referred to those 80 percent physicians, less than 10 percent cooperated with ShafaJoo.
What was the most important reason in your opinion?
SabetFar: one the main issues was that they didn’t want to clarify their financial data. They didn’t even have good knowledge of IT.
The culture of using this system was lacking. We had many meetings with organizations and public centers and we negotiated to know with which aspect of our business they had problem.
They are old organizations and opposing to them leads to the death of startups. I think that we as IT-centered businesses in this field should get closer to each other.
Hemmati: I disagree with Mr. Noori and Mr. Fattahi in some aspects. They say that managers in each field shouldn’t be passive against macro policies and organizations. Because we should keep this fact in mind that we face big organizations which have many concerns.
Thus it is weird that we wait for policy making or written permission of organizations for entering in this field. On the other hand, several works have been done.
For example, a system like Sepas has a similar system in USA and England and they have tried to be implemented by governmental support and they have succeeded in some cases; in other words, there are some needs felt in this field but it is the beginning of the way. Fortunately, IT is used in these organizations.
For example, let’s look at financial aspect. There were problems and sensitivities but their perseverance led to changes in rules and now startups are present in this field.
Fattahi: we should start from the base and progress gradually. Also we should negotiate with authorities in health organizations by providing a high quality plan which meets an important need.
You mentioned that the ministry itself is looking for implementing plans like Sepas and Shams and maybe they stand against you in the future. On the other hand, you believe that you can solve the problems in this field with your startup businesses. Why doesn’t the ministry cooperate with you? Is it your problem or is it because of information security?
Riani: the most important factor is the security of health information of people.
Sadr: generally the government never assigns a public sector.
Noori: a part of this issue is right. Because health system of countries deal with peoples’ lives and government can’t stop supervising on this part totally.
Hemmati: launching such a system is one of governance duties. For example we can’t expect that central bank be assigned to startups. It should have governmental trustee or infrastructure.
Do you think that launching a system like Shams is related to infrastructure?
Sadr: no. Such a system is an option and I think unknown fears lead to lack of trust towards startup youngsters.
Fattahi: like all other organizations, this field has its own mafia. When you provide a plan to them, they say work with a specific company; that is a company they have monitored it.
My major is traditional medicine. From about 150 years before graduates of modern science went back from Europe, traditional medicine has been pushed away. But it is offered in universities in recent years.
China launched its first university in this field 60 years ago and now there are more than 3000 hospitals of traditional medicine in China and they have data development center to which 600 hospitals are connected and their information is recorded there.
But we haven’t even had a scientific book in the field of traditional medicine in these 10 years. We proposed this system and faced these barriers. On the other hand, we don’t have any known and powerful startup in this field and this issue has become a factor for paying less attention to this field.
According to the time of launching your startups, why haven’t startups in the field of health grown so much while they are new?
On the other hand, they have many similarities and even they make us think that there isn’t any dare for trying other ways.
Sadr: the problems in the field of health startups can be examined in five levels; startups themselves, investors, regulatory, government and culture of use.
The first and biggest problem of startups is that their business field is copying each other. They don’t even change features.
Your critics say that startups of health field in Iran do only make appointments and haven’t had any progress.
Fattahi: we should define and explain making appointment, because it is a process which is sometimes completed and in some startups it isn’t.
I’m talking about Salam Doctor in which for example the patient pays the visit fee to Salam Doctor if secretary enters in the system that the patient has come, we pay the money to the physician a day later.
In other words, physicians have trusted. We have even physicians who have deleted their in-person appointment making.
But we have startups that their appointment making is just filling a form and don’t follow a complete process.
We have even defined a device which works with RFID, it is placed in offices and connected to our online system and the patient is not required to provide tracking code to the secretary and he/she only works with the device.
Sadr: it is about the fact that for example if appointment becomes RFID or any other possibility, is it the need of society or not?
Is it the need of that market or not? Why does a physician have to receive the cost of visit online? While a part of the society of physicians are conservative.
Another issue is about similar business models and nothing happens to help synergy for growing the area. This has caused that even some people refer to physicians and ask them to work with them.
These issues block the process of growth. I should go to a physician’s office every three weeks and explain him/her that I’m not deceiving him/her.
When we go to an office for the first time and explain online appointment making, they don’t get us. In the end we said that we were like a doctors’ building that works online.
According to your experience, have physicians who work with you as the owners of internet businesses in the field of health, removed the traditional and paper systems?
Sadr: never, because the culture of use is not spread and there isn’t any excuse for providing plans. Another problem of startups is that they don’t recognize needs very well.
That is they don’t observe main needs of the field based on which they can offer cooperation; offers that can really solve some problems with which physicians face and make them cooperate.
There are famous physicians to whom we offer things but because it was a different one, they have agreed to pay a percent of their income in exchange of using our services. Reaching such options is difficult and no everyone can reach them.
Hasn’t this shown that startups in this field are charged correctly that they are similar or copies. While we can offer various and special services to physicians?
Sadr: I agree and have said that there are many copies in this field. But it isn’t all startups’ fault and their founders.
Based on global statistics, the percent of IT use in industries and health field is respectively 11% and 7%.
this means that this trend is present in all around the world and isn’t Iran-specific. In fact health space hasn’t been convinced yet that they should refer to IT.
Noori: I think this market is very big and intact. And it isn’t important that startups in this field look like each other. Startup space in Iran is new and investor and government don’t know it well and all these issues in the field of health are much more.
In public organizations in Iran, there are two spaces; they do all the things themselves because they want to serve people and they don’t want to assign a part of works or they are looking for their shares.
But startups want to break this closed space and this trend in the field of health would grow although its speed is too slow. We should spend more energy and have more patience and help each other rather than following traditional behaviors like beating each other.
Hemmati: I think the main issue is that who is the trustee of health as a general product? Or to what extent can ministry of health interfere?
Government has bold presence in this field and has done big investments; in such a way that health is the second important issue of governmental investment after JCPOA.
They are looking for removing copies and etc. but the problem is that startups can’t enter the field of service quality; that is we can’t equip physicians so that he/she can improve the quality of medical care a patient receives.
The big barrier goes back to the fact that health field is too much public, because if a part of the process of treatment in Iran was private, each physician would pay attention to new options to provide better medical care and service to his/her patients.
I think we as startups should pay attention to health; that is we ignore the process in which the patient reaches a physician and focus on the concept of health.
The payment structure in Iran has still some problems. Payment in Iran is done through insurance and insurance company wants to reduce its costs. Thus they don’t open a way for startups.
Sadr: what we have observed in the market is that insurance companies welcome new plans and ideas and we even could make contracts with them.
For example, now complementary health insurance loss is -170% and they would welcome any solution.
Hemmati: being public has caused that there is very few insurance company in health system. Thus the opportunity to improve the quality of health is removed from entrepreneurship and if we do something in order for this opportunity to be seen, it can be a good start for founding startups in this field.
Sadr: I think one of the reasons that has caused startups to work sporadically is the lack of organized structure as a model in the market.
Thus finding a niche market is very difficult and this has led to similarities between startups. If a market has a form, other would have a model for designing business.
But we in the field of launching health startups have a long way to go.
In the public field, the most important problem is that there isn’t any recognized trustee.
Sadr: yes, this means having the problem of regulator. We don’t know whether we should deal with ministry of health or ministry of welfare or ICT, social security or others.
We don’t know which rules should be received from which organizations. It is the regulator that considers a barrier not the government.
We are confused and don’t know who to talk. If we know the rules we can define special features without any damage to considered issues of organizations.
But these institutions threaten us. Even in the document of outlook designed, the regulator is not determined.
While based on this document we can do many things in the field of health. For example, low-hand document that who will determine it?
These aren’t clear. Based on our experience and our cooperation with insurance companies, most of rules determined in central insurance, are not implemented across other insurance companies of the country.
Let’s talk about statistics and figures in the field of health in Iran. For example in terms of the number of experts, hospitals, medical centers and etc. In fact we want to talk about how medical facilities are divided in our country.
Riani: currently, there are 570 hospitals, more than 11,000 pharmacies, 20,000 health houses, 470 social security hospitals and 66 hospitals for armed forces in Iran.
I should mention that 80% of this economy is related to treatment not health. Health economy is a big and intact market itself.
Sadr: we face lack of experts in Iran. For example, there are only 25 pediatricians all over the country. Thus people have to wait for several hours to get their children visited.
Doctor to population ratio in our country is at the least level in the Middle East. We would face lack of physician until 15 years later when students of medicine will be graduated.
On the other hand, 80 percent of medical costs are related to wages. If we have experts, we would face with lack of hospitals and beds.
There are problems about insurances as well. The amount of debt to insurances is more than 11.000 billion tomans. Because of these problems, government would conclude to use alternative options.
Meanwhile, the role of startups would become bold and they would have an opportunity to work.
According to our talks, it seems that startups in the field of health have a long way to go and they haven’t earned a constant income. But you continue and work in this market.
Fattahi: the growth of startups in the field of health is very slow all over the world and we can’t expect that for example see the growth of startups in the field of food delivery in this field as well.
Because they have different challenges and the security of medical data is a big challenge. I think actors in the field of health should communicate more with each other, do collaborative studies over this field and share their knowledge.
This don’t exist right now and even there are people who copy the physicians of a site in their own site.
That is such challenges are generated by the people themselves for the ecosystem and have significant effect because we don’t have a big startup as a very successful sample in this field and such works are considered a barrier for growth.
When we have problem in business model, we shouldn’t go towards immorality. We should take advice and because we are beginners, we should stay beside each other.
Riani: copying means that this field has the capacity to grow and thus their people are increasing. People should have different target market and they shouldn’t be afraid of the similarity between their works and others.
There are many similar businesses in other field as well but each one could gain profit by determining their target market.
But copying should lead to the situation in which the one who copies becomes successful not the one who creates because it would damage the whole ecosystem.
Moreover, we should introduce our business in such a way that no one thinks that a business would be removed if we enter the market.
Now people in offices think that if we offer online appointments, secretaries would become unemployed. We should explain to them that these systems that startups offer would help secretaries. We tolerate such big problems to pave the way for others and even ourselves.
How big are the dimensions of health market in Iran? What figures are there in this market?
SabetFar: according to statistics we have and medial council has announced 214,000 physicians are registered who have medical system number.
Up to 7200 physicians are being added every year to this number. According to medical council, people should refer to experts with ratio of 3/6 each year but this figure is 2/2 now.
Fattahi: each year about one billion medical appointments are made in Iran and its rial value is about 30.000 billion tomans per year. We should add medical equipment, medicines and etc.
Sadr: you think that telecommunications has high profit and high turnover. While this is very inconsiderable compared to health industry.
Last year, the net profit of Hamrahe Aval and its subcategories was 1.592billion tomans. But look at figures in the field of health.
The government has executed a rule named E-confirmation of prescriptions; that is medicines related to special diseases should be electronically confirmed.
The amount of profit gained from this way 5400 billion tomans. Startups should recognize customers’ need and make the legislator make a new rule;
That is they should open a place for themselves and we can’t expect government to pave the way for them and make them grow.
Riani: physicians don’t record their information and for example if they change their office, they don’t register their changed information in medical council in order not to pay any money.
On the other hand, a few numbers of patients know to whom they refer for which illness. I asked 1200 educated people where they should go for measuring their blood pressure and only 60 people said cardiology with hesitation.
Others’ answers were incorrect. We have many problems in the field of health and each one can be a base for launching a business and employment.
Fattahi: referring system in Iran has problems too. In Iran each person to whom something happens, refers directly to a specialist while in other countries they first refer to a GP so that he/she visits the patient and then refer him/her to a specialist if necessary.
Thus we can work on this field and raise people awareness.
Can startups have a little share in this market?
Do you think that what percent belongs to you? They laugh and agree that they even have less than one percent.
Sadr: according to the statistics gained from TeleTeb which is related to today, more than 24000 people have used our service but because there are many other statistics not announced, we can’t determine the exact share of startups.
Noori: market is not certain and we are in the beginning of the way and our share is very few right now. Unfortunately medical council doesn’t take itself easy and doesn’t cooperate.
Its behavior has blocked the way. One of the things we should do is to inform people.
Fattahi: we access statistics with guess.
Do you think that what startups can be launched in this field?
Fattahi: it is so important that content production should be exclusive and there is a space for launching such a startup in this field.
Because a science has become existed during last 20 years which prescribes medicine based on genes.
SabetFar: content production about wellbeing, medicines and side effects and medical interference which can be a good topic for launching startup.
Sadr: generally, there are 12 branches in the field of health each of which can provide conditions for launching different startups; from content production to hardware and etc.
Noori: I think the topic of gene analysis to which Mr. Fattahi referred is good.
Hemmati: also in the field of following patient after visit.
Riani: health tourist is a good option for work.
Why hasn’t health field had the required attraction for powerful investors in the ecosystem?
Sadr: one the big problems in the field of health with which we face is that we don’t have a VC who has the knowledge of this field.
We could service 24000 users with the least facilities and this figure can be multiplied with the presence of investors. We have investors but little capital is gained from accelerators to startups.
Investors in Iran market are domestic and foreign. Health field is different from food or transportation fields so that each investor can dare to accept the risk and invest because there is not clear data.
The market grows based on big data and information and we can forecast it. In the field of health, we can progress until a certain limit; because organizations don’t let people about whom they are not sure, grow beyond that limit.
Riani: when there are more secure capacities for investment, investors don’t enter fields like health.
But I believe that in the end people cause these startups to remain because people need them and in the end organizations dealt with even startups that faced problems because people welcomed them.
Do you want to continue despite all the things you said? How is the future of this field in your opinion?
Sadr: the future is brighter. Darmankadeh was one of the options for one of the biggest investors in the field of health or Startup Health and we even were to make a contract for investment. But Ministry of Finance said that we couldn’t deal with them.
Also, we launched two services and after 20 days they called us and said they should be blocked. Because we have registered information of some physicians and data collection in the field of health has become banned since 1388.
Thus there isn’t any way but making appointment. We lose 90 percent of our business with this ban.
We offer another option for medicine interference in which information about 20,000 medicines and drugs are recorded but they called us and said we shouldn’t collect these data.
While none of the physicians know the name of all these drug
s and such a system is useful for them. We have problems with regulator in all fields. 8 months ago a French investor offered us millions of dollars to work on appointment system in English and French as well in Elecomp fair but I’m not allowed to work in my own country, because many people want a share in this process.
I like to work in my own country. The French company was ready to pay the costs of two-year stay in France but we didn’t accept. Because we hope that these problems would be solved and we can work here in Iran.
Fattahi: such problems are like networking businesses. 10 years ago they made limitations for people in this field but now they hold conference and honor them. Thus, these problems exist in health field now but in the future we would definitely see changes.
Noori: even if we become sacrificed in this way, we would pave the way for others and there would be many startups in this field because one or more public organizations can’t monitor and control the market, solve the issues and its problems by themselves and we should open the way for small and big companies and startups can play a role.
The village of health startups
Doctor Mahmood Fattahi, born in 1360 and fourth year resident of traditional medicine in Beheshti University of Medical Sciences, CEO and co-founder of Salam Doctor:
“I’m working on IT for 12 years. Salam Doctor is launched since 1393. I entered startup ecosystem of the country in 1392.
Our focus is on appointments in offices and medical centers. 110 physicians do have membership of our system.
More than 13000 users are registered and more than 33000 appointments are made in Salam Doctor and 14000 appointments have led to payment.
Our service is free for physicians but users have special services like delivery of test results and etc. that we have defined and receive an amount of money for it.”
Sogol SabetFar, 26 years old, has studied software in AlZahra University and is the co-founder of ShafaJoo which is launched in 1392 and with the aim of directory of physician information of medical centers:
“we recorded information of 5000 physicians and medical center. We added other services like content production and we have put 1100 articles in this field on site so far.
We have 12000 registered users and between 6000 to 8000 persons visit ShafaJoo each day. This market is not clear and business models are in the process of trial and error. Currently we have online appointment and online diets through which we connect users to experts in this field.”
Ehsan Noori is born in 1360 and has B.S. in medical engineering and has studied electronic engineering as his M.S and is present in the center of TrigUp:
“since 1393 we worked on remote medicine. We had many studies which led to creating a web-based system.
We brought our plan to TrigUp accelerator and in Dey 1394 TeleTeb was launched with focus on facilitating users communication with specialists and our vision is monitoring health remotely.
We have more than 23000 registered users and our active users are about 8350 persons. More than 248 dedicated connection between physician and user are made in TeleTeb.”
MohammadReza Hemmati has B.S in electronic engineering from Tehran University and M.S in the field of entrepreneurship at the same university.
He is born in 1371 and technical manager of AveSinap. His main field of work is prevention: “we develop a product for illness prevention.
After recognizing the illness, physician starts diagnosing the patient’s illness and a tool would be provided to patients in order to follow his/her treatment process.”
They launched their work in 1394 and their product would enter the market until the end of the year; “main part of our work is about hardware.
For preventing illness, we need to have information about physical status of people. In
this part the physician doesn’t interfere directly and we diagnose illness or prevent it using information gathered from patient and international methods.”
Noavaran Salamat Gostar Sharif
Farzad Riani, graduated from Sharif University in the major IT, Computer Networks. He is born in a family whose members are all physicians and he is 30 years old.
He knows the problems related to making appointment because his family is physician. He thinks that cloud service model is a good method to reduce problems related to health field technically.
In this model for example 10000 users can request in less than 4 seconds and a half and at the same time:
“we are looking for an integrated online appointment system whose applications would come to market with the name of Sina. Android and IOS version of this application for user, physician and secretary would be provided separately.
Public hospitals and medical centers of health houses would be present in this system. We are launching the system of pharmacy finder as well.”
Mohsen Sadr, born in 1367, is the founder of DarmanKadeh and has launched it for three years. Most important services it gives to its users are:
Appointment and other services. He has B.S of IT and M.A of MBA from Tehran University. Sadr says about the number of users on the website:
“right now more than 24000 persons are using our services.” He has received offers of investment from foreigners but he wants to work in Iran and provide services to Iranian customers. But he knows that it is a difficult way.