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Interview with Dr Bayju Thakar, CEO of Doctor Care Anywhere (ASX: DOC)
July 30, 2021
DOC, Doctor Care Anywhere, video
Doctor Care Anywhere
We spoke with Dr Bayju Thakar, CEO of Doctor Care Anywhere (ASX: DOC) about the rise of digital healthcare and how his platform for telemedicine can make a significant difference both in healthcare quality as well as lower costs of care, both in the UK and around the world.
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Stuart: Hello, and welcome to Stocks Down Under, Australia’s leading investment publication for retail and high-net-worth investors. And one of the privileges of my job as an editor, is I get to meet really interesting and successful leaders of public companies from all around the world.
And with me today on the 28th of July is, Dr. Bayju Thakar. Coming to me all the way from the UK, London in fact, where he is the CEO of Doctor Care Anywhere ASX:DOC. Good evening, Bayju, and John Snowball [SP] listening in as well.
Dr. Thakar: Morning students, thank you very much for having me indeed.
Stuart: Now, Bayju, there’s a book I’ve got on my shelf here a while ago, which you’ve probably read, Eric Topol, “The Patient Will See You Now”. That book was quite revolutionary, in fact, ahead of its time, and it came out in 2015. And he was predicting the rise of companies like yours. Tell us what Doctor Care Anywhere does, and where this is gonna go.
Dr. Thakar: Yeah. So essentially, I’m a fan of Eric Topol, American world, actually, and, his book on AI is also worth reading for those listeners who haven’t read it. He’s a very astute man. So Doctor Care Anywhere is a digital healthcare company that fundamentally was set up by myself as an ex medic. I call myself a recovering doctor. I practice medicine all around the world but set this business up in 2013, really, to provide access and better health care to people using technology.
There are so many problems that Eric Topol actually talks about, Stuart, around access, around fragmentation. And what we do at Doctor Care Anywhere is provide access to doctors through our app, through a video and phone consultation modality 24/7 with your own patient record buried in.
You can do a consultation like this, but the thing with us, it’s not just seeing the doctors, we’re able to provide you with diagnostics, we’re providing the specialist consultations, and we’re able to provide you with continuous management in an integrated joined up way.
So getting over that barrier of a fragmented health system, and lack of access to specialties, and here in the UK, we cover about two and a half million patients through our platform and through these types of consultations.
Stuart: And that’s a not-insignificant number of patients. So the population in the UK being about 60 million or so, you’ve got some pretty influential early adopters who’ve come with your platform.
Dr. Thakar: Yeah, so we go to market through, actually, the private sector, which here is about 10 million lives. So we provide our services through health insurers or hospital groups, or insurance brokers, and of those 10 million people who have private services, our market size is about 4 million people of those because we’ve partnered exclusively with one of the largest health insurers, as well as one of the largest health hospital groups and brokers.
So it gives us access to about four million people. And as they come on board, what we know is that they have about five consultations a year, and of those five consultations, about two of them can be done through a virtual modality. So we know that if you can capture those 4 million people, you’ve got about 8 billion consultations you can do a year, which is a significant amount of money at 45 pounds per consultation.
But also, once they do a consultation, they go and have diagnostic referrals where we make another 50 pounds per referral, and a specialist review where we make another 60 pounds on a specialist review. And then a follow-up for 45 pounds to 200 pounds per episode across those 4 million lives, a significant market that we have to go through just here in the UK before we add on new services like mental health or chronic disease management.
So it is exciting, and we don’t even serve here in the UK, the NHS, that’s just the private market that we’re looking at, which is about a half a billion market that we have access to.
Stuart: And what’s instructive to me is that 200 pounds may seem like a lot, but the cost savings you get elsewhere in the system. So a legendary study from Harvard several years ago actually added up the time it took in an American context to get an appointment, go to the doctor, sit in the waiting room, see the doctor, then come out.
Compared to the 15 minutes that I would spend with your folks coming through Doctor Care Anywhere, the cost savings are gonna be 10X at least, right?
Dr. Thakar: So your [inaudible 00:04:14] for cost savings. So our model is you come see me as as a GP, and rather than me sending you straight to see a specialist if I think you have a problem, let’s say you may have hurt your knee or hurt your back and I send you an orthopedic surgeon, I wouldn’t do that.
I’d order the diagnostic test based on clinical decision support tools in the platform that are based on evidence-based information embedded to the GP and order those tests, those tests would be reviewed by a specialist. So I’ve taken out all the costs of unnecessary outpatient appointments and avoided…you’ve avoided, Stuart, to go and travel to go and see those specialists.
And then we review it in the cloud and have a meeting like this thereafter to say, “This is what you need to do next with those results.” And our insurance partners, and the reason they partnered with us, the reason they actually guarantee us revenue, is because we’re saving them up to 20% in claims saving.
That’s a huge amount for an insurer if you think that these insurance claims and margins are very thin. So when you can take 20% of their claims, it’s economically relevant to them. And that’s what we’ve really done, we thought, “How do you actually build the best patient journey to deliver the best patient care but make sure it’s most efficient from an economic point of view for those who are paying?”
And that’s what healthcare needs, right, at the end of the day, it’s very expensive, and we need to make things affordable so that most people can get the best care possible.
Stuart: Right. Now, latest quarterly numbers for the June quarter just out on the ASX this morning, and if I might use the vernacular UI shooting the lights out in terms of growth, so revenue up to 78% year on year. And it’s interesting to me. So that was 4.8 million pounds in the most recent quarter. But hardly any more consultations than you did in the previous quarter because the doctors were too busy, I presume, making sure that the COVID-19 vaccine rollout in the UK was working as planned.
Dr. Thakar: It’s a really good point. So actually, although I appreciate your generous words, I would actually say quarter two was incredibly challenging from a GP supply perspective. And what we have here is, there is no shortage of demand for our business. Growth is going to continue because there are four-week, five-week wait times for a GP consult. There are five million people waiting for secondary care diagnostics.
Stuart: For a GP, it isn’t that amazing? Like, I can understand wait for specialists but wait for GPs that must [inaudible 00:06:34] horrified.
Dr. Thakar: It’s remarkable. It’s remarkable. And it’s…there’s a whole different discussion about how we think about our own public health system here and how we fund it, and how we think about it more patient-centric to the point you brought up Eric Topol, but the patient will see you now, when do we genuinely become patient-centric, which is what it’s all about.
Those wait times, to be fair, are driving significant demand for our service. We did know that in quarter two that we’d see those challenges that actually would be constrained with GP supply because they’ve all gone to do the national vaccination program, which is the right moral and ethical thing to do, was, A, let our GPs go and do that, and be expected to do that.
So I have no issue with that. And that gets our economy back on our feet. Well, what we did do during this quarter is recruit a huge number of GPs, 75, actually in a pipeline of 100, which gives us clear capacity to start meeting that demand again through Q2, Q4 and hit our revenue guidance and exceed 100% revenue growth.
So I’m really pleased with how the team sort of stepped up and recruited as heavily as they did during such challenging time with the national vaccination program. Like I said, Stuart, I’m also pleased that, you know, our GPs have contributed to the national vaccination program because that’s what’s unlocked us and we’re back in freedom, I suppose, so to speak.
Stuart: Right. Now, I’m of the opinion, tell me if I’m on the wrong track here, the best way to think about your business is not unlike Uber. So, Uber provided such a radical restructuring of personalized transport in just about every major city in the world, to the point where the regulations actually had to change in order to catch up with what the public had already voted with their feet on. Now, there’s the potential for Doctor Care Anyway to do that maybe initially in the UK market, and then around the world. Is that too adventurous a claim?
Dr. Thakar: It’s a really astute observation. So I’d say, in North America, many of our peers, or indeed larger peers, are running an Uber-type model and are really shaking things up. And I do think you’re also right in your observation that these types of models of care are ahead of the regulator.
So the patients are demanding it because of the necessity of wait times and their need for health care. You know, when you’re sick, and when you’re in pain, you don’t go and say, “Well, I’ll just sit there and wait for eight weeks,” right? You will eventually look for something and want to look after your loved one to do that if government can’t deliver it for you.
So I do think there…and as a whole industry, you’re absolutely right. I think the one thing that I would observe and what I do strongly believe, is in health care, my preferred approach is to be an incremental changer rather than a disruptive changer. And it’s probably because I’m a doctor that I think that. You have to take a lot of people along the journey to get them to do things differently.
And just digital health care is doing that, and it is doing that. But what I want to do is bring those stakeholders on the journey because they have so much to contribute. At the end of the day, when you are unwell, and you can use these digital modalities to see a doctor, get your prescriptions, get your referrals, it saves money, it does things efficiently, there’s going to come a point in time where you want someone to hold your hand in person.
There’s going to come a time where if, you know, if you’re in your last days, you need decent care. What I don’t want to do is strip the humanity from it by purely digitizing everything. And that is something that I think is the right thing to do, even though it may sort of dilute the excitement of the Uber model.
I do believe in what you’re saying in terms of being progressive. Absolutely. But I also believe we have to retain the humanity in healthcare services because that’s what ultimately it’s about when, you know, when we come to our time of being truly sick.
Stuart: Right. Now, some of your critics might be concerned about your business model because of the need, ultimately, in every major country to get electronic medical records to work properly. And we’ve seen what a debacle that’s been in just about every country it’s been tried.
Here, it’s possible to opt-out of a national electronic medical record system, and I have some sympathies with that. But, obviously, those of us who believe in digital healthcare understand the importance of that. The Obama administration even pushed, in conjunction with Congress, the whole EMR thing for the US. How reliant are you on governments getting the EMR thing right?
Dr. Thakar: Everyone in this space is reliant on is really a patient saying, “You’re my first port of call.” So when you come to me and my patients, and there’s two and a half million patients, and when we’re doing 35,000 consults a month, when they give our doctors a history, right, they are filling in a triage question before, they then giving the patient-doctor history, they’re uploading photos, uploading their medication, they’re uploading their next…and that becomes their medical records.
So we’ve become that medical record for them. I think there are two things that really interesting. One is their existing medical record in the health system. Yes, we do want access to that. But we’ve already started on that journey, and that’s now open to us in the health system.
So to be able to integrate into the NHS record, primary care, pull that into our dataset, just provides more clinical information for our doctors, and gives a better chance of, one, doing the right thing by the patient and increasing the scope of care that you can provide patients. So that is good, and that is important to be able to see that.
The second thing, really, is that all that data and the mess that most electronic health records are in is how do you actually structure it to be useful? How do you actually structure that data so you can analyze it to do something useful with it? Most of it’s a mess at the moment, there are obviously coding systems, but so much of it is still paper-based.
So we are building and we are structuring our own electronic health record. We do have access to the NHS. And also, we also share our record back to the NHS. So it’s one of those philosophies that is important to us, which is, okay, a patient comes and sees us, you come and see us, I will make sure unless you tell me you don’t want to, that I will share that back with your NGB.
So if you left us, your GP would know what medications we were providing, what that record was, so get good continuity of care. And that’s a philosophy that we hope other people will follow, too, because it’s the right thing for the patient.
Stuart: Right. Now, a lot of people will be asking what’s a UK company doing trading on the Australian Stock Exchange? You didn’t even have to come here to sell the story because we did it during the pandemic, which is a good thing because, you know, having you criticize us for the quality of our cricket team and other sporting…our lack of sporting prowess and things that the poms are good at might have been too much…
Dr. Thakar: I’m not brave enough to criticize you on an interview for your sporting prowess. I’ve been keeping an eye on the Olympic record table. I have to say, yeah, your swimming achievements in the ladies, I think, 100-meter relay was unbelievable.
That will go down in history. I think that… So why do we list on the Australian Stock Exchange to be clear? So when we were rapidly growing, and the starter came in, and even before that, we knew we wanted to go public because we thought this is…I think we’re right to think this digital healthcare has boomed.
And to have access to the capital markets to make sure that we can access the capital to develop the best platform and the best service to the patients. We wanted to be public, which exchanged…okay, you know, Australia, it was exchanged. We looked actually to two Australian board directors.
One of the original founders, alongside me, is an Australian from Melbourne, and one of our original founders is an Australian investor called Roger Allen. And they were promoting the ASX for us, and I think, on the basis, that provides a very global picture for us. We’re not intent on being a UK business.
We intend to being a global business. And so by being listed on the Australian Stock Exchange, it serves intent and also drives us to say, “Is Australia an interesting country center? Is New Zealand an interesting country center? Is Singapore, is Hong Kong an interesting center?” All those things hold true. So I think it’s a great base from which we can launch what we’re doing here into other countries.
Stuart: Yeah, and it’s fair to say that ASX has been good, too, in terms of that you’ve got a decent multiple now. You’re closer to 300 million than 200 million in the market cap.
Dr. Thakar: Yeah, I think the…I’d probably ignore that, you know, a little bit. I would say the ASX has been incredibly good to us for the quality of the shareholders that we’ve bought onto the register. There’s some just really, really strong institutional shareholders, who are thematic, they understand just your health care.
And I have to say, Stuart, I think, you know, we’re very lucky, frankly. But really pleased, you know, the guys like Helen Daly [SP] and [inaudible 00:14:37] who are our shareholders are fantastic.
Stuart: Yeah. So, let’s wind it up with this. As you would vote to a moment ago, this is not going to be a UK business, you’re taking this thing globally, presumably starting with medical systems that are originated ultimately in the UK, but it can be applicable right across the industrialized world, right?
Dr. Thakar: I think it can be applied in industrial as well. We have to think about a couple of things. One, where is the competition? So my view is, I only really want to go somewhere we can win. And by win means scale and the best quality service for our patients.
And I think there are a number of countries that are English speaking, have mature health economies like the UK, but a nation from a digital point of view. Australia being one of them. You have a mature health economy, you’re incredibly good at health services, you’re up there in the world, but your digital market is just growing.
So that shows potential. Ireland potential, Canada’s potential. Once we think about these sort of countries as a first wave, we can obviously look to emerging markets thereafter in Southeast Asia, and that’s why Australia is such a good base for us. But, absolutely, global intention, how many people can we provide better health care to that’s joined up and really accessible? And we shouldn’t stop.
Stuart: Right. So if we were having this conversation a year from now, what do you hope to have achieved with Doctor Care Anywhere?
Dr. Thakar: I think a year from now, there are a couple of things to think about. What I really want to be able to say is point to and say, “How much do our patients really appreciate this service?” Number one, and we already know we have an NPS score that’s over 80, but I want to see patients going, saying to me, “We can’t do without it.”
Stuart: It’s better [inaudible 00:16:11].
Dr. Thakar: Yeah. But you know what, it’s interesting, because…and this is for the whole sector. When things normalize, this becomes the normal, then people are going to expect the service delivered by Amazon. So we’re gonna have to expect to hold that.
The second thing I want is, I want GPs to be saying…every GP or every clinician says, “I want to work on that platform because they look after us, the provider’s training and the provider’s space, to do consults in the way we want to do them.”
And the third thing is really how we deliver better outcomes for our patients. We talked about this extended model of diagnostics, and we’re saving money for the payers. We’re already starting to show we’re saving money. But let’s link saving money to delivering better clinical outcomes.
And surely, that’s got to be the thing that we got to do. And if we can do that, then we truly can scale globally, because why wouldn’t you want a service that is cheaper and better for you clinically. And that’s the thing I really want to able to prove.
Stuart: That’s right. Well, doing good and doing good for yourself as well. Bayju, thank you. It’s been a pleasure and a privilege, and here’s to a great year ahead for Doctor Care Anyway.
Dr. Thakar: Thanks so much, Stuart. Appreciate your time.