Outcome Health

Multi-sided Model






Outcome Health is a healthcare business using a multi-sided business model to connect healthcare professionals, caregivers, and patients through an online platform. Outcome Health supports patient and physician conversations by providing a unique digital platform designed to offer a patient-centric approach to the point-of-care experience.

The company’s multi-sided business model offers on one side free services to patients and physicians by installing hardware in the clinics and providing health content-related; on the other side offers advertisement space to pharma and insurance firms displayed alongside the content supplied to users on the platform. For physicians, Outcome Health create values by delivering content on the devices that can help patients learn more about their condition engagingly. For pharma and insurance firms, the value comes from the opportunity to engage with a larger pool of patients in the care setting.

Outcome Health operates in the context of DTC (direct-to-consumer) advertising focusing on pharmaceutical products and health insurance. Looking at the competition is pretty low as this is a new channel with a few players such as Health Monitor, PatientPoint, Constant Media, and Digital Health, with substantial market opportunities, and enough space for growth.

Outcome Health operates in the US only. In 2017, the company faced charges of fraud in federal court, leading to one-third of Outcome’s employees — about 200 of 535 — to accept a voluntary buyout to leave the company. After the fallout, the company registered $200 million in revenue in 2017 and decreased to less than $100 million in 2018. In 2019, Outcome Health did $130M in revenue, according to the Wall Street Journal.

OUTCOME HEALTH HISTORY

Outcome Health’ was founded and registered as ContextMedia Health LLC in 2006 by Rishi Shah and Shradha Agarwal. The company launched the Exam Room Tablet in October 2013, the first, fully-interactive, and patient-driven patient education tool at the point of care.

In 2016, Outcome Health acquired AccentHealth, doubling its footprint and network platform. In May 2017, Outcome Health closed its first financing round of $500 million, propelling it to a $5 billion valuation and its unicorn status. However, in October 2017, Outcome Health’s co-founders and several employees have been accused of having manipulated pricing and sales information to mislead potential pharmaceutical advertisers purposely.

In 2019, the company sold the majority stake of its business to a private equity firm. Outcome says the funding will be used to fund long-term strategic plans and the company’s ongoing attempts to win back investors, advertisers, and customer trust.

OUTCOME HEALTH CUSTOMERS – WHO THEY ARE:

Patients

Patients in the waiting rooms receive a tablet set up with information relevant to a patient’s pathology and medical history. The tablets also offer meditation apps, allow patients to watch movies, and provide advertising about pharma and insurance firms. This service is provided for free by Outcome Health.

Depending on the access provided by the program, patients can access brand websites, methods of administration videos, safety information, patient testimonials.

Payers

Pharmaceutical marketers pay to reach patients in waiting rooms and physician’ offices. Advertisings are displayed alongside educational materials. According to Bloomberg, outcome Health also collects data from patients and sells it to insurers and drug-makers. For brands, this means a new opportunity to engage with patients in the care setting.

OUTCOME HEALTH ENGAGEMENT – VALUE CREATION PROPOSITION:

Outcome Health creates value for each customer group in different ways:

-For patients, Outcome Health creates value by providing content on the devices that can help patients learn more about their condition and engage with healthcare professionals and caregivers;

-For payers, Outcome Health creates value by engaging with a larger pool of patients in the care setting.

There are two side network effects: by providing a tailored solution free of charge, Outcome aims to scale the presence of patients very rapidly on the platform to result attractive to payers’ customers, i.e., the pharma companies for their marketing purposes. On the other side, partnering with big industry players would have boosted the physicians to use the platform, knowing the presence of big pharma companies.

OUTCOME HEALTH DELIVERY – THE VALUE CHAIN:

How Outcome Health works for patients and payers:

-Anatomy boards, interactive educational tablets and mobile connectivity in consultation rooms deliver measurable outcomes through actionable intelligence on conditions, treatments and lifestyle changes;

-The hardware (tv screens and tablets) where the content is displayed is installed at the firm’s expense in the physicians that accept being part of the platform;

-Content is both internally produced and produced by paying marketers;

-Patients can enjoy the content for free.

OUTCOME HEALTH MONETIZATION – VALUE CAPTURE:

Outcome Health makes money by charging big pharma and insurance firms to display their advertisings. Pharma and insurance companies can buy ads space on the platform, which will be displayed alongside the educational content to patients. Outcome places screens in waiting rooms and provides patients with a tablet where they will see these ads.

OUTCOME HEALTH DIGITAL TECHNOLOGY:

Outcome Health has invested heavily in its scale of technology implementation at outpatient healthcare facilities, business partnerships, and medical device companies to deliver better health outcomes and positively impact the human condition through technology. Outcome Health relies on digital technology to interact with its final customers as the solution they offer is very much a digital offering to the point-of-care experience. Through the collection of customer data, Outcome Health sought to recommend always a customized offer.

Sources:

https://www.outcomehealth.com/

https://www.crunchbase.com/organization/outcomehealth

https://www.bloomberg.com/

https://www.fiercehealthcare.com/tech/outcome-health-to-pay-70m-to-resolve-federal-fraud-investigation

https://medcitynews.com/2018/06/fall-healthcare-unicorn/

https://www.beckershospitalreview.com/healthcare-information-technology/a-timeline-of-the-outcome-health-fraud-scheme-and-fallout.html

https://www.wsj.com/articles/outcome-health-raising-600-million-to-digitize-the-doctors-office-1496197980

Disclaimer:

Written by Marco Paleologo and revised by Francesca Hueller under the direction of Prof Charles Baden-Fuller, Cass Business School. This case is designed to illustrate a business model category. It leverages public sources and is written to further management understanding, and it is not meant to suggest individuals made either correct or incorrect decisions. The information contained here should not be used for investment advice and is simply indicates the individual’s understanding of the company’s business models as of May 2020. © 2020

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