7 min reading time

Visit the website for AdvaMed, the Advanced Medical Technology Association which looks out for American interests, and you’ll read:

“The innovation ecosystem that supports medical technology is severely stressed. The U.S. has historically been the world leader in medical technology, but our leadership is eroding.”

AdvaMed proposes a five-step remedial plan.

(1) Improve FDA’s regulatory processes so the cost and time of development and approval of devices and diagnostrics is reduced and the CDRH mission statement that American patients will be the first in the world to have access to new devices is achieved, while maintaining the highest standards of safety and efficacy.

(2) Restructure CMS’s coverage and payment processes to support development of new technologies that improve treatment, diagnosis or prevention, and provide prompt patient access to these technologies.

(3) Reform the US tax system to create a level playing field, starting with repeal of the medical device excise tax – a tax that is draining resources from American manufacturing jobs and research.

(4) Improve access to international markets by insisting on free and fair trade in medical technology and working with foreign governments to achieve innovation-friendly regulatory and payment policies.

(5) Support the maintenance and growth of an R&D infrastructure second to none.

The Association concludes, “Failure to act will mean lost lives, unnecessary suffering, reduced job formation, and diminished economic growth.”

Do you agree?

Is US leadership in medical devices eroding? Do you agree with AdvaMed’s prescription?

Do you recommend other measures?

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Meet me at Med Tech Monday (January 23, Irvine, California).

Device companies, venture capitalists, medical device designers, investment bankers, service providers, lawyers, startups, and biotech players are scheduled to attend.

At $295 it’s one of the smallest investments you can make for a full day of networking (meals and cocktail reception included) in the medical device space.

See http://medgroup.biz/MedTechMonday for details and I look forward to meeting you in person.

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Discussions

How to file to FDA for a 510k exempt device?

Design Control Industry Meeting Recommendations

Will 2017 be better, worse, or the same for your device business?

Design requirements and material for sleep apnea face masks?

Cannabis has medical benefits – Alzeheimer’s treatments among them.

End of the med device tax?

Combination Product – clearing a device as a standalone product before submission

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SUPER BOWL TIME

Guess the correct Super Bowl teams and final score and win free admission to the next 10x Medical Device Conference at http://medgroup.biz/superbowl
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Make it a great week.

Joe Hage
Medical Devices Group Leader

P.S. I’m in San Francisco today and tomorrow at the Medtech Showcase and JP Morgan Healthcare events. Email me at JHage@MedicalDevicesGroup.net if you’re in town and want to meet in person.

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Mark Plait
Senior Principal QA Expert at Mark Plait
The medical device industry in the US has been forced to seek off shore relocations due to the horrendous tax structures that makes competition difficult at best. The current tax structure does not promote US medical device companies to be global players but instead shackles them into being 510K “me too” players (cheaper) rather than driving innovation through investment in R&D (more expensive). When the return on investment is looked at under the current tax structure and FDA approval cost and time cycle, it may cause many to not make the investment. While healing people, and improving the quality of life is always the optimal ideal to strive for, the bottom line is profit. Companies are in
this business to make a profit as are their stock holders. We need to make it worth their while to base their companies in the United States. Other wise they
will continue to leave and take the good jobs with them.

Paula Norbom
Independent Recruiter | Executive Search | Contract Staffing Health Technology Community – BioTech, Healthcare & MedTech
For those in college looking to enter the medical device industry, obtaining an internship is a great way to break into the industry.

Julie Omohundro
Principal Consultant at Class Three, LLC
TK, what would you recommend in terms of fixing Sarbanes-Oxley?

Paul M. Stein
Chief Scientist, Inventor, and Entrepreneur – Dedicated to the Treatment of Critical Unmet Medical Needs
Paula, I’ve always been into mentoring our newest generation looking to work in the medical device industry. Based on your own experience working for clients looking to get critical positions filled, you have any advice for those in college regarding how to best guide their education to be most successful? Further out, have those going right into startups not succeeded as well as those going more into the Giant companies?

Julie Omohundro
Principal Consultant at Class Three, LLC
Paula, can you provide links to the sources from which you have taken your figures?

Theodore Kucklick
CEO and founder Cannuflow, Inc, Author “The Medical Device R&D Handbook”
More and better exits = more early stage investment . One problem that needs fixing is SARBOX, and the restoration of a functioning small-cap stock market so that you can grow a company, so that M&A is no longer the only game in town. Crowdfunding doesn’t cut it.

Paul M. Stein
Chief Scientist, Inventor, and Entrepreneur – Dedicated to the Treatment of Critical Unmet Medical Needs
I think leadership in the medical devices industry is eroding.

David Walker
Computational Storage Specialist
Super Like Suggestion #5 about R&D. Let’s get rid of the wires for medical supervisory controls and patient data acquisition systems. No wires for EKG. No wires for basic patient vitals monitoring. No wires for SO2 level monitoring. Innovate medical monitoring systems using wireless IoT technologies and low power scatternet network topologies so the hospital IT doesn’t get upset with access to the hospital’s wired corporate intranets.

Mike Helmus
Medtech Executive: Due Diligence/Tech Xfer/IP Expert, 3D Printed Surgery, Drug Delivery, Tissue Engin, Nano -NYC/Boston
There is emerging concern about our ability to sustain innovation and these concerns are real and should not be ignored. Large corporations, need to maintain an innovative core even if its to allow a proper due diligence of the technology they are going to acquire. In fact, the impact of the increasing failure to translate to commercialization is having an impact on the US. Our consolidation of industry, the elimination of Corp. R&D, dependence on start-ups that cannot navigate the valley of death contribute to the inability to translate needed technology to commercialization. See my post From Lab to Market: From Brainstorming through Development
https://www.linkedin.com/pulse/from-lab-market-brainstorming-process-mike-helmus

Yunhong Zheng
General Manager at Imexdental
Yes, agree, FDA shall cooperate with all countries in this world, to generate international standard and regulatory which could be recognized to everywhere, not to make it country by country.

Carl Simpson
Director at Amaranth
These are all good points and a reflection of our industry. Do we think if we can turn all these issues around will early stage VC make a comeback?

Harold Fernandez
Professor of Cardiothoracic Surgery, Chief cardiovascular Surgery Southside Hospital
You bring up some excellent points. Despite the strict FDA regulatory process here in America, we still see many examples of new technologies that come to clinical use without adequate evidence of safety and efficacy. Nonetheless, I agree that changes are long overdue.

Paula Norbom
Independent Recruiter | Executive Search | Contract Staffing Health Technology Community – BioTech, Healthcare & MedTech
AdvaMed does have one thing right when two years ago they said, “the innovation ecosystem that supports medical technology is severely stressed.” The innovation ecosystem for medical devices in America is still stressed. But it isn’t all the result of legislation & bad regulation. The medical device excise tax is likely to be repealed. FDA regulations are turning more towards cyber security & global competitors like the EU are increasing the robustness of their own regulatory processes. The stress comes from U.S. innovators moving too fast.

New device companies are sprouting up across the U.S. & the industry has a shortage of quality talent in the US. Schools aren’t churning out engineers & technology experts at high enough rates, & millennials are less likely than previous generations to work for small companies that don’t show much potential for upward mobility. Talent scarcity is an issue U.S. device companies will have to address to protect their advantage at the top.

Paula Norbom
Independent Recruiter | Executive Search | Contract Staffing Health Technology Community – BioTech, Healthcare & MedTech
Is our leadership in the world of innovative medical technology still eroding? A closer look at recent history would suggest otherwise.

In 2015, when AdvaMed released their innovation agenda, the U.S. med device market value was 43% of the entire global market. The U.S. not only possesses the largest med device market, but it remains a major exporter of innovative products to the rest of the world: in 2015, exports of med devices from the U.S. over $44B in key product areas, and general medical/technical equipment exports over $83B. 2015 was a record year for investment in small innovative device companies, and the US continues gain device patents at a higher rate than the rest of the world markets combined.

Paula Norbom
Independent Recruiter | Executive Search | Contract Staffing Health Technology Community – BioTech, Healthcare & MedTech
The US is set up to remain a driver in innovative medical devices. It helps that America is also the global center of microelectronics, telecommunications, instrumentation, biotechnology, and software development. As the field of medicine continues to evolve, this ensures that American medical device companies will continue to be advantageously located as the leaders of research and development for the future.

The creation of Galvani Bioelectronics is one of many examples from the past two years of major global pharmaceutical companies relying on leadership from the U.S. device industry. They are recognizing that electronic & software development holds the key to the future of first-line medicine, & are partnering with American medical device companies to access the talent & resources required to engineer a future of personalized medicine.

That all being said, AdvaMed does still have one thing right. The innovation ecosystem for medical devices in America is still stressed.

Virginia Guest
Regulatory Affairs Consultant
I think US leadership in medical devices is fine.

Paul Senkle
Electrical Engineer. Proven track record for product and process support in Aerospace and Medical Device Industries.
I tend to believe that AdvaMed’s prescription is incomplete. For the remaining portion of that prescription, AdvaMed must look to it’s own members and consider the powerful force of globalization which large and medium size “American” medical device companies have embraced. Will a more conducive and profitable business environment result in now therapies to address new indications? Or, will it merely result in more cash for big companies to acquire and assimilate small companies?

Sherry Liu
Business Operations Manager | Business Program Manager | Business Planner | Global | Business Analyst | Finance Manager
Agree that the 4th bulletin point is called out.

David Rivotto
Surgical Sales Specialist
Agreed. Well stated.

Martin Berka
IoT systems: putting it all together
“American patients will be the first in the world to have access to new devices […] while maintaining the highest standards of safety and efficacy” – it sounds like they want the system to be best at everything, and (according to the later points) to lobby for the industry in other markets and possibly subsidize its research expenditures. The prescription seems overly idealistic, like instructing a morbidly obese patient to eat only raw vegetables and exercise 20 hours per week.