The Ernst & Young “Pulse of the Industry: Medical Technology Report 2011” was released last month, bringing with it a host of data, recommendations, and insight applicable to medical device manufacturers of all sizes. The report, which was presented at the Advamed 2011conference, aims to offer a global analysis of the entire medical device industry from a regulatory, economic, and demographic perspective.
Several interesting points were made within the “Pulse of the Industry” report that indicate the direction in which the medical device business specifically, and healthcare in general, is moving.
A renewed emphasis on outcomes will require that companies shift their focus from moving as many units as possible to marshalling the resources needed to demonstrate definite improvements in health outcomes for a specific product. Advertising and promotion of medical devices will by necessity move to complement this new approach, which could very well become the yardstick by which an organization’s success is judged in the industry – especially with regard to hospitals and health care decision makers increasingly restrained by smaller purchasing budgets.
Medical device companies will also face a challenge in sustaining innovation in the face of a dramatically changing financial and regulatory environment. Over the course of 2010, global medical device venture capital investment dropped by 13 percent compared to 2009. The effect was even more pronounced in the United States, which saw a 15 percent reduction in venture capital financing during the same period. Combined with pricing pressures and an uncertain future regarding the FDA regulation of high tech medical devices, developers will have to make strategic choices concerning the amount of investment made in uncharted areas of the industry.
With these challenges and uncertainties, innovative device developers can benefit by taking a “phased,” or step-wise, approach through the FDA process. By investing in an initial FDA regulatory strategy/review, which may include a pre-IDE or pre-submission meeting, companies can take the first steps to build a positive relationship with their future FDA review team. They will also have an objective outline of their expected regulatory pathway, including FDA concerns and issues and top-level budgets for collecting the most useful clinical data to present to future investors and partners.
Republished and adapted with permission from MDCISUBSCRIBE TO OUR MONTHLY NEWSLETTER>>