CARI Analysis: Healthtech investment in Asia Pacific more than halved due to COVID-19 but opportunities remain

By CARI | 17 June 2020


CARI Analysis: Healthtech investment in Asia Pacific
more than halved due to COVID-19 but opportunities remain

Author: Aznita Ahmad Pharmy | Research Editor: Eleen Ooi Yi Ling
Webmaster: Nor Amirah Mohd Aminuddin | Research Director: Hong Jukhee

“CARI Analysis: Healthtech investment in Asia Pacific more than halved by COVID-19 but opportunities remain” looks at how the COVID-19 pandemic has affected investment trends in healthtech in the region, startups that have performed well and what the remaining months of 2020 could potentially hold for this sector.

(This article contains 5 charts and best viewed on a desktop or horizontally on your mobile.)


a) Healthtech was the third-largest sub-sector in global healthcare private equity investment in 2019, with Asia Pacific in third place in terms of healthcare investment raised.
b) Healthtech investment in Asia Pacific in the first quarter of 2020 fell 56% year-on-year to US$703 million. This is in contrast to the US, which had yet to feel the effects of COVID-19 and saw its healthtech investment rise 1.5 times to US$3.1 billion during the same period.
c) Among the sub-regions, Southeast Asia saw its healthtech investment decline by 68% while China saw a 78% drop. Only India and North East Asia saw an increase in investments. Out of the ASEAN countries, only Singapore made it into the top six countries to receive funding in the first quarter of 2020.
d) Healthtech firms in Asia Pacific that provide patient-centric solutions such as telemedicine were able to attract larger investments during the first quarter of 2020.
e) Healthtech investment outlook from the US and Asia Pacific for the remainder of 2020 suggests that private investment will continue and highly sought after healthtech subcategories include telemedicine.
f) To ensure a strong post-pandemic recovery for ASEAN, healthtech solutions, such as a regional tracking app, should be included in regional measures to mitigate the pandemic. To better prepare ASEAN against future health crises, a proper framework for the development of healthtech in the region must be included in the succeeding roadmap to the ASEAN Post-2015 Health Development Agenda for 2016 to 2020, and proposed Consolidated Strategy on the Fourth Industrial Revolution (4IR).

1. 2019 saw an upward trend in global healthcare private equity investment with healthtech taking the third-largest subsector spot

The global healthcare sector saw increased private equity investment in 2019, with the value of total deals closed increasing by 14% to US$78.9 billion.1 There were a total of 313 healthcare deals in 2019, with the average deal value showing an increase of 25% and a total of 27 deals in which the deal value exceeded US$1 billion.2 A large portion of global investments went to healthcare providers, and biopharma, followed by healthtech.3

Across all the regions covered, healthtech4 was the third largest healthcare subsector. Described mainly as the convergence between healthcare and technology,5 examples of health technology (healthtech) include telemedicine, electronic medical record (EMR), remote monitoring and wellness apps.6 Total deal value in healthtech globally dropped to US$4.3 billion in 2019 from US$10.5 billion in 2018 but investment in healthtech tends to fluctuate over the long-term.7

a. North America remains the largest market in healthcare in 2019

  • North America captured the biggest share of private equity activities worth US$46.7 billion (Figure 1).
  • Intense competition for assets took place between many different entities, including large buyout funds, European funds, tech-focused funds and corporates.
  • There were no mega-deals or large public take-overs.
  • The provider sector remained the most active with deals 96 deals, equivalent to 60% of all deals in 2019.

b. Investors in Europe look for scaling opportunities as deal values increases

  • Total disclosed deal value in 2019 increased 10.7% to reach a new high of US$19.7 billion.
  • Some investors pursued scale across nearly all verticals in retail health while many smaller provider assets in non-traditional retail health verticals are building scale and are expected to reach a size that appeals to private equity funds.
  • The increase in total deal value was partially due to a US$10.1 billion carve-out7 of Nestlé Skin Health.
  • The region continues to show the trend of biopharma assets making up most of the deal values in Europe.

c. Healthcare investment in the Asia Pacific region was geographically more diverse, with investment in digital platforms as one of the emerging trends

  • Private equity investment in the healthcare sector in Asia Pacific in 2019 fell 29% to US$11.5 billion but when viewed over the long-term, the region continues to display a growth trajectory.
  • Investment in 2019 was more geographically diverse than before:
    • China, India and Australia represented 51% of the deals closed, compared with 90% in 2018.
    • Southeast Asia showed an increase of 21% in deals closed.8
  • The healthcare provider sector saw the most activity, with 29 deals closed, worth US$4.4 billion.
  • The three major emerging trends were:
    • the consolidation of healthcare providers to execute buy-and-build strategies and achieve scale.
    • investment in health-related digital platforms.
    • innovative solutions that would allow the region to close its healthcare gap.

d. Outside of Asia Pacific, healthcare investment deals centred on South America and the Middle East

  • The South American and the Middle East regions saw a total of six deals.
  • The only disclosed deal value in 2019 was the US$1 billion acquisition of Lumenis, an energy-based medical solutions provider, by Baring Private Equity Asia.

Even before the onset of the COVID-19 pandemic, private equity investors were concerned of a global recession in the near term, followed by geopolitical conditions.9 The global private equity investment of the healthcare sector provides a bigger picture of which the healthtech sector makes up a small but steadily growing portion. In the Asia Pacific region, investment in digital platforms was one of the trends observed in healthcare private equity in 2019.

2. Healthtech investment in Asia Pacific hit by COVID-19

a. All subregions saw a decline in investment except for India and North East Asia

With the COVID-19 pandemic causing repercussions on economies around the globe, investment in healthtech in the region has been affected as well.

  • Healthtech investment in Asia Pacific declined in Q1 2020, a sharp contrast to the US which saw a strong start to 2020:
    • Asia Pacific’s healthtech investment in Q1 2020 fell 56% to US$703 million while its peers in the US saw its investment triple to US$3 billion (Figure 2). This was due to the region feeling the effects of the COVID-19 pandemic before the US.10
    • Although the impact from COVID-19 is beginning to be felt across healthtech’s investment landscape in the Asia Pacific region, the full impact has yet to be seen, and it would be difficult to ascertain the full extent of capital flight.11


  • China and Southeast Asia saw a sharp drop in healthtech investment:
    • China saw a 78% drop in healthtech investment in Q1 2020, followed by Southeast Asia, which saw its investment decline by 66%.
  • India and North East Asia’s healthtech investment showed moderate growth:
    • The only regions which saw an increase were India and North East Asia which saw its investments increase 3.35 times and 30% respectively (Figure 3).


b. Two mega deals closed while share of total funding fell by more than half

The investments garnered in Asia Pacific in Q1 2020 were mainly generated by two mega deals, which exceeded US$100 million each. One of the deals was struck in China, the other in India and together, the two deals represented 36% of total funding, which was down 4% compared to the same period a year ago.

The share of total funding excluding the mega deals in Q1 2020 also shrunk to 53% year-on-year. Meanwhile, the average deal value decreased by 31% to US$10.6 million, most likely reflecting a global downward trend in valuations.

c. China captured the largest total deal value in the region, with regional investment focused mainly on agnostic disease ventures

In terms of total deal value, China leads the Asia Pacific region with US$280 million, followed by India (US$251 million) and South Korea (US$66 million).

Out of the ASEAN countries, only Singapore made it into the top six countries in receiving funding in Q1 2020 with US$41 million.

  • Healthtech investment in the Asia Pacific region mainly targeted agnostic disease ventures (32%). Agnostic disease ventures are those that do not focus on specific diseases.
  • Under disease-specific solutions, investments poured into chronic diseases (cardiovascular (9%), diabetes (8%)), oncology (11%) and preventive health (8%) (Figure 4).
  • In Q1 2020, a total of 141 individual investors participated across 68 deals compared with the 182 individual investors that participated in 99 deals12 in Q1 2019.

3. Healthtech investment trends in Asia Pacific show bright spots for startups that address COVID-19 needs

a. Patient-centric solutions among those that outperformed the market

The COVID-19 outbreak is expected to have a substantial economic impact and accelerate the creation of new business models. It has already affected healthtech firms’ revenues and patients, making the development and adoption of patient-centric digital health solutions a priority for both public and private health sectors. The impact is expected to be felt across all the healthcare industry for 6 to 12 months and potentially beyond.15

Digital health solutions that address issues posed by the pandemic saw large increases in investments in Q1 2020; telemedicine’s deal value increased 8.47 times compared to Q1 2019, the largest increase among all healthtech services.16 The other two sub-sectors that saw an increase were health insurtech (42%) and patient solutions (18%).17 Other services such as remote monitoring, medical diagnostics and health management solutions saw an increase in investments.18

b. The emergence of tracking applications in response to COVID-19

The pandemic has also led to the creation of a new category of health solution: contact tracing or tracking apps. Governments are introducing applications to track and trace contamination and adapt privacy laws. Table 1 shows some of the applications that have been rolled out in Asia Pacific.


Table 1: Tracking apps used by selected countries in Asia Pacific19





Existing App

The government has used existing applications, including Alipay, WeChat and Tencent
Healthcare to track people’s interactions and perform contact tracing.


Aarogya Setu

Developed by the government of India, the mobile application uses Bluetooth technology to connect essential health services with the people in its fight against COVID-19.



Developed by the Government Technology Agency (GovTech) in collaboration with the Ministry of Health (MOH), the app works by exchanging short-distance Bluetooth signals between mobile phones that have the app installed.


MyTrace and

Developed by the Ministry of Science, Technology and Information (MOSTI), the app uses Bluetooth to measure how long a user’s phone has been in proximity with other MyTrace users.
If a user is diagnosed with COVID-19, this would allow the authorities to track and contact those who might have contracted it from them.20



Created by the Ministry of Communication and Information Technology, the app cross-references the data stored on its users’ mobile devices through Bluetooth connection.



Created by technology firm Bkav, the app uses Bluetooth to link with smartphones within a two-meter distance and will notify its users if they came within two meters of a COVID-19 patient in the past 14 days.21

The Philippines

Created by the National Task Force (NTF) COVID-19 and information technology company Multisys Technologies Corporation.22 The online platform consisting of a website and a mobile application will generate a heat map for infections using self-reported information.23

c. Prominent healthtech deals in Asia Pacific in Q1 2020 shine a spotlight on telemedicine and diagnostics

The decline in year-on-year healthtech funding did not stop the following startups from capturing a healthy dose of investment. Healthtech firms that are patient-centric managed to bring in larger investments (Table 2).


Table 2: Major healthtech investments in Asia Pacific in Q1 2020







Patient-centric Investments

ZY Health


US$143 million

Series D

Patient solutions

Tasly Holding Group, LBInvestment



US$27 million

Series B


Square Peg, EDBI, IHH

R&D and Diagnostics Investments

3D Medicine


US$40 million

Series F1

Medical diagnostics

China Resources
Pharmaceutical Industry
Investment Fund


South Korea

US$25.9 million

Series C


IMM Investment, InterVest,
Kakao Ventures


  • Early stage: all deals up to and including Pre-A stage
  • Growth stage: Series A, B & C stages
  • Late stage: Series D & beyond stages
  • Exit stage: all IPO and M&A deals

d. Healthtech firms in Asia Pacific that are performing well during the COVID-19 pandemic

(Patient-centric solution)


Photo credit: DoctorAnywhere

Singapore’s Doctor Anywhere received US$27 million in Series B funding:

  • The company intends to use it for extensive expansion to augment the region’s healthcare landscape through digital transformation, with the support of strong local and regional partners. 24
  • Apart from Singapore, the telehealth company operates in Thailand and Vietnam.

In April 2020, it announced the launch of the COVID-19 Medical Advisory Clinic. 25

  • Without having to physically go to a clinic, patients can have a video consultation and speak to a doctor within five minutes.
  • The CEO and founder of Doctor Anywhere, Lim Wai Mun, said the business has seen a two-to-threefold jump in growth since the COVID-19 outbreak started. 26



Photo credit: Lunit

  • South Korea’s Lunit received US$25.9 million in Series C funding in Q1 2020, the largest funding it has received since its US$15 million Series B funding in 2019.
  • The firm develops AI-powered analysis of lung diseases via chest x-ray images and will use the latest round of funding to bankroll the global expansion of its chest X-ray and mammography products, and its other AI solutions. 27
  • With shortages and delays in standard COVID-19 tests, chest x-rays have become one of the fastest and most affordable ways for doctors to triage patients (the sorting of patients based on urgency of care).
  • Lunit’s AI-powered software recently helped a teleradiology firm in France scan patients and calculate a probability of COVID-19 infection within 10 minutes. 28
  • In March 2020, the firm announced the release of its software online, free of charge, to help healthcare professionals manage COVID-19. 29

Looking at the progress of healthtech firms like Doctor Anywhere and Lunit, there are ways for healthtech firms to not only stay afloat during this time of uncertainty, but also pursue opportunities to improve patients’ quality of living and ultimately, save lives.

As mentioned before, the Q1 2020 results do not truly reflect the impact of COVID-19 on healthtech investments in Asia Pacific and therefore, we will look at more recent data obtained in the US since it is the largest healthcare market globally, to have some insight into what the future could portend for healthtech investments in Asia Pacific.

4. Outlook for the remainder of 2020 shows investment will continue with telemedicine anticipated to be a favoured asset

a. Healthtech investment outlook in the US expected to be poor but undeployed funds factors may buffer overall impact

The US had its strongest start ever in healthtech investment in 2020 by bringing in US$3.1 billion during the first quarter, according to Rock Health data.

The COVID-19 pandemic hit the US in February 2019 and the twin crises of a global pandemic and massive economic shifts are expected to rapidly impact all market sectors, including healthtech.

A survey of 12 leading healthcare investors conducted between 16-20 March by Rock Health30 provides an early indication of healthtech31 investment trends in the US going forward:32

    • i. Access to capital will be limited
      Two thirds of the respondents felt that healthtech startups will have a “much harder time” raising capital in 2020 than they did in 2019. Sequoia Capital noted that COVID-19 has and will cause supply chain disruptions, reductions in growth forecasts and changes in hiring plans.


    • ii. Access to private capital won’t contract as rapidly as public capital
      Most of the investors surveyed will not be reducing the amount of capital they intend to invest in 2020; only three “somewhat agreed” to the statement that said they would deploy less capital than anticipated at the beginning of 2020.The advantage of several years of heightened VC and private equity (PE) fundraising is that firms collectively possess a large amount of dry powder (funds that have been raised but not yet deployed). This may, to some extent, help alleviate the near-term market shock on the availability of capital to entrepreneurs.


    • iii. Healthtech is in a unique position to expand the capacity of a strained healthcare system
      According to Rock Health, the acute mismatch between supply and demand is the most significant problem facing healthcare today, particularly the human capital (medical doctors and nurses) mismatch during the pandemic. Healthtech firms offer technologies that support the delivery of virtual healthcare, scaling the medical workforce, and the acceleration of R&D for diagnostics and treatments.Investors surveyed anticipate growth in remote monitoring, symptom checkers and triage tools (Figure 5). Telemedicine, in particular, has been deployed at the front lines of the pandemic. Rock Health’s annual Digital Health Consumer Adoption Survey found the use of live video telemedicine has increased 4.5 times in 2019 from 2015.


  • iv. A dim outlook for IPOs and M&As in 2020
    An impending recession would no doubt diminish public investor appetite for initial public offerings (IPOs). All but one of the investors surveyed felt that the healthtech IPO window is shut for 2020. However, those same investors were slightly less aligned in their predictions about the M&A market. Two thirds of the respondents believe “market volatility will significantly slow down digital health M&A activity.”33

b. Healthtech investment outlook in Asia Pacific – gloomy prospects ahead but providers of critical products and services expected to perform well

The above findings provide a snapshot of how the COVID-19 pandemic has affected healthtech investment in the US and how it will affect future investments. In Asia Pacific, the following insights emerged:34

    • i. Digital healthcare businesses have become a hidden gem
      Private equity investors and venture capitalists are seeking under-the-radar picks that include digital healthcare businesses. Healthtech is expected to remain a key focus of investors even after the pandemic subsides. According to Lip Kian Ang, a partner at a Singapore-based law firm, the healthcare, medical R&D and pharmaceutical industries will likely be high on the list of priorities for private equity companies for the next five-year plan.


    • ii. The rise of specific sub-sectors – telemedicine and online pharmacies
      Private investment firm Fundnel has seen a surge in investors enquiring about investing in healthtech. Telemedicine and online pharmacies have become especially popular for sector-focused venture capital funds that allow investors to diversify their allocations into specific themes.


  • iii. The necessity of tech-based value-chain businesses
    The recent health crisis has highlighted the importance of keeping the supply chain going especially for vital industries such as healthcare. One venture capitalist said that COVID-19 had helped to “open up opportunities in weakened offline value chains” in any sector which continues to rely on traditional methods, and this may push the adoption of tech-enabled solutions.35 Vynn Capital foresees the tech industry working more closely with traditional sectors as corporates will need to invest in improving the supply chain.

From observing the healthtech investment outlook for 2020 for the US and Asia Pacific, two similar points emerge:

    • i. Private investment into the healthtech sector will continue although with a few differences:

      • Investment in the healthtech sector in the US will be from venture capital and private equity funds that have already raised funds but have yet to deploy them.
      • In Asia, venture capitalists and private equity investors are looking to invest in under-the-radar picks such as digital healthcare businesses.


  • ii. Telemedicine has become particularly popular among investors:

    • It was among the sub-sectors anticipated to see growth in 2020 according to investors surveyed in the US
    • Singaporean telemedicine firm Doctor Anywhere raised US$27 million in Series B funding in the first quarter of 2020.

5. Conclusion

Most ASEAN-level discussions at the moment are understandably focused on the containment of the COVID-19 pandemic but ASEAN must also plan for the future to be better prepared should a similar crisis occur again.

a. Healthtech can advance inclusive and affordable healthcare in ASEAN

Healthtech has the potential to meet the evolving and varying healthcare needs of Southeast Asia.36 The onset of COVID-19 amplified this point even further. A Deloitte report released in April 2020 anticipates the pause in healthtech investments in the US to be temporary37 and this may also be the case in Asia and by extension, Southeast Asia. The COVID-19 pandemic has helped to highlight the importance of healthtech, which is now front and centre economically, politically, and socially. Under the current situation, emphasis on healthtech, particularly virtual health is expected to continue.

b. Healthtech should be included in ASEAN’s future frameworks and strategies

Intra-ASEAN COVID-19 tracking system

Outside of ASEAN’s official frameworks and strategies, the inclusion of healthtech in any regional measures whether to fight the pandemic or support a post-pandemic recovery plan could be beneficial. For example, the use of an intra-ASEAN tracking system would allow regional travel to safely resume while insurtech could expand coverage in a time of rising healthcare expenses.

ASEAN Health Sector Cooperation

As a regional bloc, ASEAN has several regional health mechanisms put in place by the ASEAN Health Sector Cooperation that covers areas including public health emergencies, epidemiology training network, big data analytics and visualisation, and public health laboratories network. 38

ASEAN Economic Community Blueprint 2015 and 2025

The ASEAN Economic Community (AEC) Blueprint 2015 lists healthcare services as one of four prioritised sectors to be liberalised by 2010 and the subsequent AEC Blueprint 2025 focuses on strategic measures that would promote the development of a strong healthcare industry. 39 In both the AEC Blueprint 2025 and AEC 2025 Consolidated Strategic Action Plan (CSAP), the promotion of potential high growth sectors such as health tourism and e-healthcare services is mentioned.

ASEAN Post-2015 Health Development Agenda 2016-2020

The ASEAN Post-2015 Health Development Agenda for 2016 to 2020 covers the shared goals, strategies, priorities and programmes of the health sector between 2016-2020.40 For the succeeding health development agenda, it is recommended that healthtech is added to clusters related to healthcare system resilience and accessibility.

Recommendations for succeeding ASEAN frameworks

To include healthtech in future ASEAN frameworks, the following will need to be considered:

  • The definition of “healthtech” needs to be properly defined in all ASEAN documentation going forward. The current definition of “healthtech” varies amongst member states, and the alignment will ensure that all parties share the same understanding of the definition of “healthtech” . This is crucial to prevent healthtech being left out of master plans or having duplicate entries.
  • As healthtech covers a relatively large scope, prioritisation of relevant categories under the sector such as telemedicine, online pharmacies and remote monitoring should be done to ensure a more targeted and effective approach.
  • The concept note on the promotion of health tourism and e-healthcare services developed under the CSAP should be developed further and include healthtech.
  • The promotion of public-private partnership (PPP) investments for the provision of universal healthcare41 under the CSAP should be extended to specifically include healthtech as this can spur PPP investment in healthtech areas beneficial for the region.


Inclusion in the Consolidated Strategy on the Fourth Industrial Revolution (4IR)

It would be prudent to include healthtech in the proposed Consolidated Strategy on the Fourth Industrial Revolution (4IR) as well. ASEAN needs a proper framework for the development of its healthtech sector so as to not squander the progress that has already been made and to ensure the region is able to harness 4IR technologies to provide quality and affordable healthcare for its people.


1 Bain & Company, “Global Healthcare Private Equity and Corporate M&A Report 2020,” March 2020.
2 Ibid.
3 Ibid.
4 The original Bain & Company report used the term “medtech and related services.” For consistency in this report, “medtech and related services” is used as an approximation of healthtech.
5 Deloitte Insights, “Health tech investment trends: How are investors positioning for the future of health?” March 12, 2020.
6 Galen Growth, “Asia Pac Healthtech Investment Landscape Q1 2020 COVID-19 Special,” January 2020.
7 Bain & Company, “Global Healthcare Private Equity and Corporate M&A Report 2020,” March 2020.
8 According to Investopedia, a carve-out is the partial divestiture of a business unit in which a parent company sells minority interest of a child company to outside investors.
9 Bain & Company, “Global Healthcare Private Equity and Corporate M&A Report 2020,” March 2020.
10 Based on a Preqin survey.
11 Galen Growth, “Asia Pac Healthtech Investment Landscape Q1 2020 COVID-19 Special,” January 2020.
12 Galen Growth, “Asia Pac Healthtech Investment Landscape Q1 2020 COVID-19 Special,” January 2020.
13 Agnostic disease ventures are those that do not focus on specific diseases.
14 Galen Growth, “Asia Pac Healthtech Investment Landscape Year-end 2019.”
15 Galen Growth, “Asia Pac Healthtech Investment Landscape Q1 2020 COVID-19 Special,” January 2020.
16 Ibid.
17 Ibid.
18 Ibid.
19 Ibid.
20 Malay Mail, “Gerak Malaysia, MySejahtera, MyTrace: Apps to get you through the MCO,” May 5, 2020.
21 VnExpress, “Vietnam develops coronavirus contact tracing app,” April 21, 2020.
22 Rappler, “PH launches online platform for virus contact tracing,” April 10, 2020.
23 Rappler, “LIST: Coronavirus contact tracing apps in the Philippines,” April 14, 2020.
24 MobiHealthNews, “Doctor Anywhere scores $27M in Series B funding round,” March 31, 2020.
25 MobiHealthNews, “Doctor Anywhere to launch COVID-19 Medical Advisory Clinic,” April 14, 2020.
26 ASEAN Today, “COVID-19 pushes healthcare technology transformation in Asia,” May 9, 2020.
27 Korea Tech Desk, “Korean Medical AI startup Lunit secures $26 million funding for global expansion,” January 14, 2020.
28 MIT Technology Review, “Doctors are using AI to triage covid-19 patients. The tools may be here to stay,” April 23, 2020.
29 Imaging Technology News, “Lunit Releases AI Online to Support Healthcare Professionals Manage COVID-19,” March 30, 2020.
30 Rock Health Investor Survey Q1 2020.
31 Healthtech is used in this article but the term “digital health” is used by Rock Health. The two terms have similar meanings. For consistency, this article will use the term “healthtech” throughout.
32 Rock Health, “Amidst a record $3.1B funding in Q1 2020, digital health braces for COVID-19 impact,” March, 2020.
33 Rock Health Investor Survey Q1 2020.
34 DealStreetAsia, “Asia’s private equity hunts for gems in the time of coronavirus,” March 25, 2020.
35 Ibid.
36 Monk’s Hill Ventures, “How Tech Will Meet Evolving Healthcare Needs in Southeast Asia,” November 12, 2019.
37 Deloitte, “COVID-19 could alter and even accelerate health-tech investment strategies,” April 10, 2020.
38 ASEAN, “ASEAN Plus Three senior health officials reaffirm cooperation to stop spread of 2019-nCoV,” February 4, 2020.
39 CARI, “AEC 2025 Blueprint Analysis on Healthcare,” May 19, 2017.
40 ASEAN, “ASEAN Health Ministers Meeting (AHMM) – Overview.”
41 ASEAN, “ASEAN Economic Community 2025 Consolidated Strategic Action Plan,” August 14, 2018.

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