As the digitalization of the healthcare industry continues, we are seeing increased demand for new innovative medical devices. Projections show that by 2030, global sales of medical devices will reach $800 billion. Wearables are becoming very popular as a means of monitoring chronic conditions and promoting general wellness, while economic development in the emerging markets is unlocking huge potential for industry players.
Looming over all this excitement, is the realization that pricing is heading in a downward direction. There is tremendous pressure from governments to lower healthcare costs- especially in hospitals- where medical devices are most heavily used. This is a major concern for medical device companies who have traditionally focused their resources on R&D, as now they must figure out how to stay on top of their shrinking margins. This is compounded by the fact that with data becoming a hot commodity, many new companies are entering the market in an attempt to harness medical data from patients and end users. In order to stay in the game, companies need to adjust their revenue structure to add more services and technologies into their devices.
Here are some of the changes we will be seeing in the coming decade, as the medical device industry adjusts to tightening margins and advances in technology.
The Proliferation of Data
In the next 10 years, it will be all about connecting with the end users by integrating ‘smart’ services to collect data and improve patients’ overall health. Manufacturers of medical devices need to start adding value by building intelligence into their products to get closer to the end users and collect data. They should consider partnering with existing tech companies to integrate smart technologies into their portfolio.
The proliferation of wearables and at home medical devices has changed the playing field dramatically. Remote patient monitoring is a major growing sector with projections putting it at $1.9 billion by 2025 globally. These devices provide clinicians with information to diagnose, monitor and prevent disease without the expense of clinic and hospital visits.
From smart watches with built-in EKG monitors to apps like Oncoassist, for cancer prognosis, the market is now flooded with innovative new apps and devices integrating smart features to provide real time patient data.
The need for data privacy
The personal and sensitive nature of all this patient data has made cybersecurity a major concern. In order to protect privacy, companies need to invest heavily to ensure compliance with security standards. As long as proper security standards are in place, these concerns need not deter manufacturers. In the coming years, as the focus continues to shift from treatment to prevention, products that connect with patients to support healthy lifestyle changes will be in high demand.
Focus on Adding Value Instead of Reducing Costs
In this newly commoditized and competitive market, the importance of value-added services cannot be overstated. Many medical device manufacturers have already begun to offer supplemental services along with their products.
One of the global leaders in dialysis equipment manufacturing and clinics, Fresenius Medical, has recently acquired NxStage Medical, Inc. with the goal of entering the home treatment market.
Siemens Healthineers which is now the largest and most profitable segment of the global conglomerate, has grown by adding a suite of services such as managed services, consulting and technology solutions.
Manufacturers need to consider how they can add more services into their offerings in order to stay profitable in this tight market.
Data Sharing Technologies
Technological development in the healthcare market is happening at an unprecedented rate. By 2030, we will see the adoption of ‘patient and consumer data sharing technologies’ by leading medical device manufacturers. This includes wearables, smart apps, blockchain, IoT, and cloud-based data analytics. Many life sciences companies have begun to heavily invest into these technologies.
Medical Innovation
Aside from data sharing technologies, a host of new innovations will flood the medical device market in the coming years in the areas of surgical robotics, imaging, drug delivery, patient monitoring, and assistive care and therapy.
Great advancements are being made in the development of surgical robots and intelligent balloon catheters that will reduce the need for invasive surgeries and significantly improve outcomes.
Another exciting area of development is in diagnosis and imaging technologies. DNA, nanobots, and AI are now being utilized for imaging, diagnosis and to make treatment decisions. Companies such as Google are investing into these technologies as they have the potential to make a huge impact on the imaging sector, specifically in the area of early cancer detection.
New devices like biostamps and smart inhalers will personalize and reduce the invasiveness of patient monitoring drug delivery. Many companies are developing connected inhalers which send the patient medication reminders and transmit data to their physicians.
Researchers at the University of California have developed a first prototype of an artificial implantable kidney the size of a coffee cup with a zero percent chance of organ rejection.
These are just a few of the plethora of new medical technologies that are already disrupting the market. Now is the time for those in the industry to identify winning cross-sector partnerships and start integrating these technologies.
Expanding Roles
Medical device companies will have a widened role in the overall healthcare process, as their devices begin to include more technologies for prevention, diagnosis, treatment, and care.
Over the coming decade, treatment protocols will significantly evolve, and developments in AI will greatly improve diagnosis and care options, driving down healthcare costs. This will reduce time spent in the hospital and the focus of the industry will shift toward preventative technologies.
New markets
China and India are growing at twice the rate of the general market, and will therefore, play a much larger role in the coming decade. Government healthcare reforms and incentives combined with the drive for innovation will bring these two countries to the forefront of the medical device industry. Of course, the U.S. will remain the clear leader, but in order to stay relevant, companies need to develop tailored entry strategies for these, and other emerging markets.
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