What can we learn from the Clydebank failure?

Back in the mid 1990’s, before someone, somewhere coined the term medical tourism, I was a UK Marketing Director with an American owned hospital company.

Back in the mid 1990’s, before someone, somewhere coined the term medical tourism, I was a UK Marketing Director with an American owned hospital company. We were big in medical tourism…. but in those days, it was known as the international patient business. One day, I got a call from a head-hunter, promising big money for an opportunity that surely I wouldn’t want to miss….
This is roughly how the conversation went:
Head-hunter: “We’ve got these American investors who are planning to spend $500 million on a brand new 260 bed state of the art private hospital in the UK. They plan to attract international patients from all over the world. It’s going to be called “Health Care International.”
KP: “Sounds interesting. Where are they going to build it?”
Head-hunter: “On Clydebank. It’s going to be massive.”
KP: “Clydebank….. You mean Clydebank…. in Scotland….near Glasgow.”
Head-hunter: “Yes, that’s right. It’ll be close to the airport so people will be able to fly in from all over the world. Labour costs for hospital workers in Scotland are much lower than they are in America”
KP: “Are you serious?” “Or is this a bad joke?”
Head-hunter: “I’m serious. It’s backed by some American guys who are ex-Harvard Medical School and a US medical ventures company. They’re going to create a medical city. They know what they’re doing. They want someone to run it who knows the business inside out. You come highly recommended. Are you interested?”
I think my response was something along the lines of, “Not in your wildest dreams”.
So…what happened?
Health Care International was one of the biggest disasters of all time in terms of a hospital development. They built the Clydebank hospital……. patients didn’t come. Surprise, surprise, they failed to fill its 240 beds, 21 operating theatres and neighbouring five-star hotel. By 1995, it was going bust.
Unperturbed by this unmitigated failure, in walked a group of Middle Eastern investors from Abu Dhabi with a plan to “develop the hospital as a centre of international medical excellence”. It grew to 540 beds. And in 2002, it went bust again. In walked the National Health Service who picked up a state of the art hospital and all the equipment for around $50 million!
It’s still there. It’s now part of the NHS National Waiting Times Centre and is known as the Golden Jubilee National Hospital.
And there’s not a medical tourist in sight!
History repeats itself…
It was the poet and philosopher, George Santayana, who said, “Those who do not study history are doomed to repeat it.”
At the core of the Health Care International debacle was a failure to understand marketing and a failure to understand the market.

  • The Americans involved had little real grasp of the international patient business.
  • The Abu Dhabi investors who bought it out had even less.

But they both had a vision of a booming medical tourism market and it cost them millions and millions of dollars.
Around the medical tourism world today, I see history repeating itself. Investors getting involved who may have little real grasp of the international patient business, being guided by others who may have even less.
So, my suggestion to the investors and medical tourism pundits is “Get your history books out”.
Or buy a decent marketing text book. It might save you a few million!

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Keith Pollard
As Editor in Chief of International Medical Travel Journal (IMTJ) and a Healthcare Consultant for LaingBuisson, Keith Pollard is one of Europe’s leading experts on private healthcare, medical tourism and cross border healthcare, providing consultancy and research services, and attending and contributing to major conferences across the world on the subject. He has been involved in private healthcare, medical travel and cross border healthcare since the 1990s. His career has embraced the management of private hospitals in the UK, research and feasibility studies for healthcare ventures, the marketing and business development aspects of healthcare and medical travel and publishing, research and consultancy on cross border healthcare.