Medtech companies prepare for an innovation makeover

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10/10/2013 by Health Research Institute
Medtech companies prepare for an innovation makeover

At a glance

The mere concept of innovation needs redefining in a health ecosystem that demands and rewards new models for delivering better care across a broader patient population at lower costs. Medtech companies must get ready to compete in this new environment or risk being displaced by ones that can show evidence their innovations achieve the same high clinical standards but are faster, better, cheaper, and more integrated into the care delivery continuum.

For decades, the medtech industry was on the forefront of innovation, but now return on innovation investment is declining. Growth through technology innovation has slowed substantially and the benefits from incremental improvements to existing devices pale in comparison to the cost of making them. Profits are contracting and total shareholder returns for medtech companies have been declining over the last few years. The ability to continue serving existing customers and markets in a meaningful way is becoming increasingly difficult because today they are expecting more from medtech.

The mere concept of innovation needs redefining in a health ecosystem that demands and rewards new models for delivering better care across a broader patient population at lower costs. Medtech companies must get ready to compete in this new environment or risk being displaced by ones that can show evidence their innovations achieve the same high clinical standards but are faster, better, cheaper, and more integrated into the care delivery continuum. In many instances these companies may exist outside the traditional medtech realm.