Convergence could drive industry disruption
Across industries, incumbent organizations tend to rely on established business models and processes. But improving those models, or making the processes more efficient, doesn’t tend to move the needle when it comes to changing the consumer experience. Industry disruptions—often driven by fragmentation, friction, and a need for more affordable options—have historically occurred despite existing business models and processes.
Start-ups and organizations from outside of the life sciences and health care sectors are working to fill the gap between consumer preferences and existing products and services. Private equity firms invested about $87 billion in health care start-ups between 2021 and 2024.6 During the same period, consumers spent nearly $550 billion on non-traditional health care products and services, according to a Deloitte analysis of the Global Wellness Institute’s 2022 report.
The market opportunity to fill the gap in consumer needs could drive convergence in 2025. More start-ups could enter the space, and existing organizations might develop new products and services to satisfy changing consumer preferences. Consider this: Virtual health, artificial intelligence (AI), fitness trackers, and wearable devices appear to be driving disruption in the sector, according to the Deloitte 2024 Health Care Consumer Survey. As a result, convergence could become a major trend for life sciences and health care companies in 2025. However, a collaborator or alliance today could become tomorrow’s competition (see Medtech’s digital innovation era).
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