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Disruption by Blockchain Part 31: Vijay Reddy – Synthium Health

  • 22 February 2018
  • Expert Insights

Our new Disruption by Blockchain series aims to highlight companies that are leveraging the incredible potential of blockchain technology to disrupt and revolutionize their industry. Through one on one interviews, we'll speak directly with industry leaders to cut beyond the hype and get directly to the heart of practical use cases and examples of how it will change the world, one industry at a time.

The following is an interview we recently had with Vijay Reddy, CEO of Synthium Health.

1. What’s the history of Synthium Health? How and where did you begin?

VR: Cost of supplies is the second largest expense followed by labor cost for a healthcare facility. As per Strategic Marketplace Initiative, this is expected to exceed Labor costs by 2022. With the goal to make a difference in the healthcare supplies space, we incorporated Synthium Health in December 2013. We began working on building this platform in early 2014 and it was fully functional by the end of 2016. While working on the project, we conducted several surveys and interviews with materials managers of healthcare facilities as well as suppliers and manufacturers. We took their opinions to develop use cases and incorporated their feedbacks as features on the platform. Overall, we spent over 27,000 man hours. We then put together a small sales and marketing team in efforts to get members on board. As we saw interest, we began on boarding members (healthcare providers, manufacturers/suppliers) and making small transactions on the platform as well.

2. Who are the founders and key team members?

Vijay Reddy, CEO

An Entrepreneur with more than 25 years of experience in the healthcare industry with leading roles in several companies. From a Chief Information Officer at OSI Systems, Inc. (now MedAssets), a healthcare start-up company to starting and leading several  healthcare/technology companies including Synthium Health.

George Kruythoff, Director of Sales Operations

A Seasoned sales executive with cross-functional experience and proven success.

He successfully drove multi-million dollar strategies that led to the growth of corporate revenues for the US and international product manufacturing and distribution companies.

Yamini Vedhire, CFO

A senior executive with over 18 years of experience in finance and operations management.

She plays key roles in developing and implementing financial procedures along with managing operations, accounting and taxes. She holds an MBA with a major in finance.

Satish Jamwal, Product Development Manager

A Senior project management expert with a knack for team leadership, Satish is a valuable technological asset for our team.

Working directly with our development staff, he’s responsible for making Synthium the top-quality platform that it is.

Board of Advisors: Kurt Blasena, Ruby Raley, Pete Schommer, Leslie Teso-Lichtman, Joseph Chiarelli, Dave Johnson, Jeff Daniels, Rick Curtis, Lisa Kilawee, Moises Faidengold

3. What problem are you solving? Who are you solving it for?

VR: Healthcare supplies eco-system today, constantly faces an uphill battle and to name just a few are…

1. Lack of relevant and timely information for all actors involved

2. Increased competition, necessitating faster delivery at cheapest cost

3. Regulatory/compliance issues

4. Tracking the supply chain for products and finances

These problems are being faced by manufacturers/suppliers/providers in their own way. By way of connecting all of these actors on our platform, we facilitate communication which we believe is the key to solving any problem. Ultimately, everyone wants to reduce costs and increase their margins.

4. What is your solution to this problem?

VR: Synthium is the only intelligent, blockchain enabled healthcare technology platform that addresses supply chain participants in Health Industry by seamlessly linking Manufacturers, GPOs, Distributors and Providers. Synthium saves healthcare providers time, money and effort to procure products at best active price and just-in-time delivery while keeping track of transactions and charge-backs. For Manufacturers, GPOs and Distributors, Synthium provides a transparent platform to maintain, update and track all transactions from sourcing to settlement and enables on-demand reporting.

By utilizing the advanced Synthium Health platform, healthcare trading partners should expect to eliminate much of that cost affecting profit strangling expense which adds hugely to the cost of medtech products sourced by providers. Reduction in that expense will immediately increase margins for suppliers, in short, it is a win-win situation for all the trading partners.

5. Why is your industry ripe for disruption?

VR: Healthcare experts accept that nearly one third (1/3), over 33% of the cost in healthcare stem from inefficiencies. Most of the hospitals are losing money. Reduction in reimbursements and constant pressure for value-based care is hurting further. Healthcare providers are at a tipping point and status-quo is no longer working. For a medical device manufacturer, SG&A (Sales, General & Administrative) can be anywhere from 30% to 80% (2.5x – 3.5x times more than that of other industries). Disruption is inevitable and a promising technology which can solve some of the issues listed above will gain the market share.

In 2018 or shortly thereafter, 90% of CMS (Centers for Medicare& Medicaid) services will be reimbursed on the basis of value.  Hence, value-based metric is the most pressing issue the industry is facing, evidenced by push in direction to bundled or performance-based reimbursements.

In this regard, Synthium Health is uniquely positioned to help healthcare providers deliver better outcomes at lower costs. Employing Synthium’s advanced technology blockchain platform solutions for healthcare will facilitate smoother, faster, more transparent, traceable transactions; breaking down those heretofore stubborn barriers; allowing far greater collaboration that would directly benefit the trading partners, leading to measurable gains in achieving their most vaulted value-based goals.

6. What’s the future of your industry?

Prediction #1: We believe that 2018 will see wider adoption/acceptance of blockchain in healthcare in general, including the supplies space.

Prediction #2: Group Purchasing Organizations (GPO) will redefine their models and value within the healthcare community and some of the players will go extinct if change is not implemented.

Prediction #3: Value-based care and consolidations will continue.

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