The medical device and diagnostic (MDD) industry built its success on delivering the right tools to physicians so that they can optimally help patients. The drive for sleeker, more interoperable, and easier-to-use devices led to innovations that speed care delivery and operational efficiency. Advances in diagnostic imaging drives faster and more accurate diagnoses and treatment decisions. While MDD companies are generally well versed in addressing the concerns of value analysis committees, they struggle to take the next step to redefine the value of diagnostics.
Two critical areas for companies in the device or diagnostics space to embrace for securing longer-term commercial success include:
1. Harnessing the power of the data that medtech and diagnostics generate to improve care and lower costs.
While working on product innovation for an MDD company who honed in for years on the four walls of the doctor’s office, we asked them to consider the value of all the data their devices collected from thousands of primary care physicians’ (PCP) offices across the U.S. How might that, along with lab results, fuel predictive algorithms that could catch early stages of expensive and complex diseases such as chronic obstructive pulmonary disease (COPD) or congestive heart failure (CHF) that have comorbidities PCPs typically handle?
What if an MDD company, with reach throughout the healthcare continuum, could facilitate data following a patient through exacerbations and ER visits all the way back to their next GP visit? Instead of looking at the patient through the lens of the specific location where they are receiving care, companies are making headway across the care continuum by improving predictive analytics (radiology) and making it easier to remotely monitor and treat patients at home (telemonitoring).
Electronic Medical Records (EMR) companies are still seen as the data leaders, although they lack the medical know-how of MDD leaders to truly advance care pathways and clinical protocols. We expect to see major shifts—mergers and acquisitions—that combine EMR and MDD into unstoppable companies that can truly leverage patient data longitudinally and predictively, and across healthcare settings to improve lives. If MDD companies aren’t building this idea into their long-term commercial strategies, they may soon become small players vying for a shrinking share of healthcare spend.
2. Innovate new business models and solutions to keep pace with healthcare’s new care delivery systems that change the established calculus of today’s value analysis committees.
Micro-hospitals. Standalone ERs. Telehealth. House calls. These healthcare model innovations are designed to address a rise in consumer demand for convenient outpatient ways to access healthcare while also helping healthcare systems stay financially viable, deliver quality care, and meet the needs of changing demographics. With the rise of population health goals and a decrease in reimbursement rates, you can see why innovations in healthcare delivery have moved to a more diverse, patient-centric set of options that get patients back home from the hospital as quickly as possible. And keep them there.
The MDD industry needs to keep abreast of how healthcare C-suites are determining which new delivery methods to invest in, what services they’ll offer, and how they’ll decide to staff and stock their facilities. All of these factors have major implications for where and how MDD products and services can be sold, and the value analysis that will be done to determine what will be purchased.
More than that, the C-suite needs thought-partners to help figure out what new care delivery systems they’ll start. They are looking more and more to their vendors to become partners in transforming care through predictive analytics, IT solutions, and the disease management population solutions that vendors offer. They are also looking to vendors to help innovate new business models such as risk-sharing models, lease, and service models that move things off capital budgets, and so forth.
More MDD companies have their own advisory boards, typically populated with customers representing clinical and hospital leadership, who advise which products and services should be offered to healthcare. But many MDD companies are still failing to fully grasp the challenges that the C-suite faces, including the immense challenges to shift to value-based care both clinically—doctors who resist changing the way they practice and patients who don’t adhere to their therapies—as well as operationally.
As a consequence of not being fully in tune with the very real pain points felt by health system executives, not a lot of companies are successfully building those insights into their long-term commercial strategy of product R&D and new business model development. MDD companies are also struggling to make crucial internal integration changes needed to address the needs of customers across the care continuum. Many are trying to solve for business units that have traditionally been siloed from one another and who now must coordinate as they make sales calls to the C-suite. Their fragmentation foils their ability to offer fully integrated solutions to health systems.
Many also fail to see their role as co-creators with the C-suite, with shared responsibility to design solutions that are needed to overcome healthcare challenges. This is a lost opportunity to truly innovate a long-term commercial strategy to stay ahead of the curve.
Crafting a long-term commercial vision means 1) mapping a vision to leverage data for better disease prevention and management, and 2) continually uncovering C-suite pain points and partnering with them to develop new business models and solutions as they navigate and evolve their health systems to deliver truly integrated care. Without those two critical areas covered in your commercial vision, success is fleeting.