- Faced with intense competition and pressure to reduce costs, medical devices manufacturers are looking to increase the number of breakthroughs in innovation
- As the pace of innovation accelerates, medical devices manufacturers that fail to embrace a collaborative approach may find their competitiveness under threat.
New regulatory requirements, fierce competition, rapidly emerging technologies and constraints on governments’ health spending are just a few of the changes to the medical devices sector. Leading medical devices companies are responding by continuing to invest in research and development and shifting innovation from incremental to breakthrough innovation strategies.
“More than other manufacturing sectors, medical devices has a special stake in innovation,” says Chris Stirling, Chair, Global Life Sciences, Partner, KPMG in the UK. “The nature of the business requires companies to elevate their performance to offer better life-enhancing and life-saving technologies.”
The KPMG International survey of 386 manufacturers worldwide revealed a high level of investment and distinct drive for breakthrough innovation among the 55 medical devices companies surveyed. This was in contrast to manufacturers polled in other sectors who had a smaller outlook on breakthrough innovation.
In addition to new medical devices, breakthroughs in the sector are expected take a number of different forms. The KPMG report cites several examples:
- New technologies – 3D printing has been used to fabricate replacement vertebrae and skull bones
- New techniques – Robotics and 3D visual systems have been combined for use in surgical procedures
- New materials – New coatings designed for use in hip implants can prevent premature failures
- New teaching methods – A surgeon at Duke University has used Google glasses to stream live feeds for training to medical students in India
To achieve breakthroughs like these, R&D alone is not enough. Medical devices companies need to review their traditional approaches to innovation and take up new strategies designed to accommodate the rapidly evolving and globalized marketplace.
According to the survey, 80 percent of medical devices respondents believe future innovations will increasingly come through partnerships, rather than in-house efforts, and 82 percent are already pursuing more collaborative business models with suppliers and customers.
Leading medical devices manufacturers are also collaborating with a much broader range of players than before. As new technologies and data analytic capabilities create opportunities for advances in surgical, diagnostic and healthcare monitoring techniques, medical devices companies need to work with partners that bring knowledge and capabilities beyond the traditional medical devices toolkit, such as:
- Telecom companies, who have expertise enabling better connectivity of smart healthcare devices
- Insurers and governments, who can collaborate in developing data dictionaries and enabling broader data collection and analytic techniques
- High tech companies, who can help propel advances in healthcare-related hardware and software (e.g., Apple Watch and related health tracking apps)
“Medical devices companies need to embrace more inclusive innovation models, collaborate more frequently and with a broader range of partners, and pursue greater integration with suppliers, development partners and healthcare providers,” says Stirling. “While there are signs that many companies are moving in this direction, those that lag behind stand to miss out on the rewards that the next wave of medical devices innovation will bring.”