Dr Andy Round gives opinion on NHS devolution to Greater Manchester Business Week

  • July 10, 2015

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Devolving healthcare spending to councils in Greater Manchester has been dubbed the most ground-breaking change to happen to the NHS since its creation in 1948. Dr Andy Round, investment director at specialist life sciences investor, SPARK Impact, explores the benefits that the new model will offer to residents and businesses in the NHS supply chain.

Greater Manchester is making history by becoming the first English region to get full control of its health spending. Devolving responsibility of the city region’s £6bn health and social care budgets to the people on the ground means that residents can expect better public services and joined-up decision-making that is more in line with their needs.

Looking to the Nordic countries as an example suggests that patient services deployed at source with flexibility are best positioned to respond to local market conditions. They also offer better value for money by ensuring that budget is allocated to the services most in demand.  But while the patient benefits offered by the devolved model are well understood, what will the impact be on regional SMEs who are in the business of developing new healthcare technologies for the NHS market?

SMEs can often struggle to win NHS contracts against larger competitors who have greater bargaining power, approved supplier status and existing long term contracts in place. With the freedom afforded by the new administration, it’s important that we support innovative SMEs and help them to engage with local NHS teams in order to accelerate acceptance of novel products and services.

An example from our portfolio is Asep Healthcare, a developer of a disposable tourniquet. The product took nearly three years to get onto NHS supply chain, before that the company had to sell to individuals, then specific hospital wards before converting the whole hospital (and then group), at great expense and significant time.

SPARK Impact has invested more than £26m into a broad range of healthcare SMEs and entrepreneurs – from cancer diagnostics, pharmaceuticals, drug manufacture, healthcare technologies, analytical services and medical devices – and we have found that Asep’s experience is not an isolated case.

Altrincham-based Diagnostic Healthcare is an established NHS provider and offers diagnostic services and treatments including MRI, ultrasound, cardiac tests and bone density scans. The company has been based in the North West for ten years and provides services to primary care trusts, hospitals, GP practices and community clinics.

Diagnostic Healthcare initially faced lengthy procurement processes, audits and assessments before it could provide services to the NHS. Under an autonomous local system, firms like this should expect to have greater direct access to those in control of the budget.

Start-up, Zilico, which is based at Manchester Science Park, has pioneered a technology that improves the accuracy and speed of cervical cancer screening.  Sheffield Teaching Hospitals NHS Trust has already adopted Zilico’s innovative diagnostic tool as part of its cervical cancer care pathway and the business is looking to replicate this success with NHS Trusts around the country. Under an administration that has greater control over its own destiny, there is the potential to create a win-win scenario with businesses like Zilico – and others from across the North West – where both patient services and the regional economy stand to benefit.

 

Quite fittingly for a region shaped by its legacy as ‘the birthplace of the industrial revolution’, Greater Manchester now has another opportunity to break new ground by driving forward healthcare transformation and I, for one, am looking forward to the ride.