Smart Care

Mar 26

Healthcare x Digital winners MICIN power rise in telemedicine

By Malcolm Foster

One silver lining of the Covid-19 pandemic is that it has hastened the digitalization of Japan’s healthcare industry, which lags behind the healthcare industries in other developed economies. That’s been a boon to MICIN Inc., which was one of the first Japanese companies to offer online medical services. The startup, launched in 2015 by four young men, won the Best Product Award at the American Chamber of Commerce in Japan’s Healthcare x Digital competition on December 1.

“Without the pandemic, digitalization would have come much more slowly,” says Ryoichi Kusama, MICIN’s co-founder and senior vice president. “We want to help the medical industry change from within and become a player that can be trusted.”

MICIN’s online medical exam service, called curon, can be accessed through a smartphone app and allows patients to make and hold video appointments with doctors as well as receive prescriptions at their homes. It is now used by more than 5,000 clinics and hospitals—only about five percent of the 110,000 medical facilities in Japan—a number that Kusama says is far too small. “We want that to grow,” he said.

The ACCJ Journal talked to Kusama about his journey and that of MICIN, the challenges the company has faced, and what it was like presenting at the Healthcare x Digital event, which aims to spur on industry-changing technologies, as well as connect Japan-based startups with major pharmaceutical companies.

The event was driven by a group of ACCJ committees—Healthcare; Alternative Investment; Information, Communications and Technology; and Secure Digital Infrastructure—and led by ACCJ Corporate Sustaining Members AstraZeneca K.K., Bayer Yakuhin, Ltd., and Deloitte Touche Tohmatsu LLC, as well as President’s Circle Member Eli Lilly Japan K.K. The ACCJ-Kansai Chapter played a critical role in organizing the competition.

Where did you get your company name?

At Stanford University in the 1970s, some engineers came up with a medical artificial intelligence program called MYCIN. Its goal was to recommend the best medicine for treatment of diseases. It wasn’t able to give recommendations that were quite as good as those of medical experts in their field, but it was able to help doctors dealing with cases outside their expertise. Ultimately, it failed. But we wanted to pay homage to that effort and changed MY to MI for “medical information” to create MICIN.

How did your company start?

There are four co-founders, including me. It all started when the current CEO, Seigo Hara, and I were both employees at McKinsey & Company. Hara is a medical doctor, so he has been involved in many healthcare projects. I was a part of two or three of them with him.

In the summer of 2015, when I was working for McKinsey in New Jersey, I came back to Japan for vacation and met up with Hara for dinner. He said he was thinking about quitting McKinsey and going corporate. He saw an opportunity in addressing a pain point in the inefficiencies of handling medical information in Japan.

I had noticed the same thing, so we started to think about possibly starting a company together to tackle this. But neither of us were IT engineers; we couldn’t write code. So, we had to find a chief technology officer.

By chance, I met a computer engineer named Yusuke Sugomori at a barbecue in New York soon after that. He was saying he planned to quit his job, so I asked him if he wanted to join us. “That sounds like a cool company,” he said.

Sugomori contacted a friend named Ryushi Shiohama, who was also a computer programmer. So those were the four starting members—two guys on the business side, two on the engineering side.

If I hadn’t met Sugomori at the barbecue, there probably would be no MICIN. Same if I hadn’t met Hara at McKinsey. This company was the result of several key encounters.

What strengths and experiences do you each bring?

Hara is a medical doctor, an alumnus of the University of Tokyo Graduate School of Medicine, so he has detailed medical knowledge. Sugomori is strong in machine learning and has written books on this. And Shiohama has been coding since middle school, so he’s an experienced systems engineer.

I’m probably the least specialized of the four of us. My background is in mechanical engineering, and I’ve worked on healthcare issues. I kind of fill the role of “other duties.” I was chief operating officer, so I sometimes say that COO stands for “chief other officer.”

What memory stands out from the early days?

We started out working in a small apartment in an old building from the 1970s. We were told that it would be demolished in 18–24 months. So, it was kind of a question of whether the building or MICIN would collapse first—or we would grow enough to move out into a larger, better space. I remember that and riding the last train home at night.

Where did the idea of curon come from?

In August 2015, the Japanese government deregulated online medical treatment. Until then, it could only be used for a limited number of diseases. But that was expanded quite broadly. This provided an opening for us to move ahead with the idea of creating an app that would allow people to get an online medical examination. We like to say that your smartphone becomes your examination room.

*In February 2020, MICIN‘s curon online medical exam service was used only by about 2,000 facilities. A year into the pandemic, that has more than doubled to about 5,000.*

Normally, if you feel like something’s wrong, you go to the hospital, and you often wait a long time to see a doctor. But the actual time the doctor sees you is like three minutes. That’s not an ideal situation.

Lately, through the internet, you can buy vegetables and shoes—but you don’t have to wait three or four hours to do that. In the same way, if you use the internet to see a doctor, the wait time drops sharply. You could book an appointment for 4:00 p.m. and see the doctor at that time.

After the online medical exam, you would pay the doctor’s bill through the app using your credit card, and the medicine would be delivered to your home. That’s the new kind of medical experience we’re creating.

Can doctors really examine patients online?

There are some diseases that can be addressed online and some that cannot. Diagnoses that involve listening to or touching the patient are hard to do this way—orthopedics, for example. But internal medicine or chronic diseases are easier.

“Because of Covid-19, digitalization has advanced five years in the space of one."

Also, initial visits are very hard do online because the doctor generally needs to see a patient to correctly diagnose the problem. But subsequent visits can often be done online because the doctor already knows the situation. For things such as treating high blood pressure, if there’s no change in the patient’s state, then the doctor can prescribe the same medicine.

How receptive have doctors and hospitals been to curon?

Compared with the more proactive stance of pharmaceutical companies, doctors and hospitals have shown a bit more reluctance or confusion. It’s not that they dislike or are opposed to information technology (IT), but doctors are very busy. So, to learn a new IT system can sound overwhelming.

Curon is a relatively easy system. It’s browser based, so there’s no need to install software. Before using it, doctors are sometimes resistant or not very confident, but once they start, they generally find it easy. You just really need your index figure to touch commands.

Do you have other lines of business?

Yes, we have three divisions. In addition to online health services, we support clinical drug trials through a digital-solutions business that seeks to assist pharmaceutical companies. We also have a digital therapeutics business that uses an app to help people seeking counseling or who have other issues. For example, if someone wanting to quit smoking feels the urge to light up, the app can offer some alternative actions—such as washing one’s face—that will distract them or help reduce the urge.

In terms of sales right now, the one related to clinical trials is the smallest but also has the most potential.

How has Covid raised awareness about online health?

In February 2020, curon was used only by about 2,000 facilities. But now it’s more than doubled to about 5,000. Because of Covid-19, digitalization has advanced five years in the space of one. We think we have a big responsibility at a time such as this.

Why the jump?

Two reasons. First, because of the spread of Covid-19, doctors don’t necessarily want patients to come to hospitals and risk spreading the virus. Second, regulations governing online medical services were loosened.

It’s also changing other industry practices. Traditionally, Japanese pharmaceutical companies have medical representatives—salespeople—who visit hospitals and explain their drugs. But with the pandemic, doctors didn’t really want these reps to visit them. So, Covid-19 forced a big rethink of this model.

How did you fund your startup in Japan?

At first, we were using our own money. But then we received funds from an angel investor. In 2018, we received an investment of ¥1.1 billion from a few companies.

What challenges did you face starting your business?

One issue was that, other than me, we really didn’t have any staff to help on the business side. To increase users, we needed doctors and health facilities to get to know our system. But I was basically doing that alone, so that was hard.

Another difficult thing was managing the pace of hiring. For example, if sales double in six months, it’s hard to double your staff in the same amount of time and hire really good people. So, you have to think about how to cope with rapid growth using existing staff.

In online medical services, how far behind the US is Japan? Why?

There are several large companies in the United States that provide online healthcare services used by millions. By comparison, Japan is about five years behind. This method of providing healthcare is spreading here, but more slowly than in other countries. I think the biggest reason is that there aren’t as many incentives for doctors and medical facilities to use online services. A Keio University study of the difference, in 17 nations, between doctors’ reimbursement for online and in-person meetings shows that in only two countries did doctors lose money with online services. Japan is one of them.

So, we need to provide incentives for doctors to adopt online services. That’s one reason that hospitals and doctors are a bit reluctant to install telemedicine for all patients.

What was the presentation experience like?

Because we were pitching to pharmaceutical companies, I focused on how online platforms would impact their industry. I explained how, because online services are easier, fewer patients drop out and the portion of patients who continue to get treatment grows. That’s a plus for pharmaceutical companies.

We are also seeking to boost patients’ satisfaction rate. The expression “beyond the pill” is heard in the pharmaceutical industry—in other words, not just providing medicine, but trying innovations in patients’ treatment experiences. I explained how we could work together to achieve those goals.

How will your Healthcare x Digital win help you?

The biggest plus it that it has expanded the collaboration with major pharmaceutical companies. Those companies want to support patients to make sure that their products are used appropriately. So, we talked about how they could get feedback from patients to better understand their issues and use the curon platform to achieve an ideal patient journey.

The ACCJ has many attractive partners, so if there are startups that want to expand their business through such collaboration, I’d encourage them to enter the competition.