Smaller Businesses Beget Better Innovation

It will be different next time. Much different, hopefully.
 
Future pandemics are unlikely to resemble the disjointed patchwork of COVID-19 mitigation efforts implemented worldwide by lawmakers and health officials. Instead, they possibly will involve more coordinated responses and widespread testing, as well as technological innovations inspired by design thinking.
 
Such thinking could result in redesigned public spaces that double as treatment areas during an outbreak and airports with more security screening lanes. Hospitals are likely to rethink conventional schematics too, potentially employing such pandemic-busting features as negative pressure zones, special patient evaluation areas, telehealth centers, and flexible-use rooms (i.e., those easily modified between acute care and ICU).
 
With the COVID-19 threat unlikely to abate in the fore- seeable future, design thinking could potentially become a powerful tool in helping to better manage and control forthcoming pandemics. The approach is already being used to improve healthcare equity and spawn creative solutions to medicine’s most pressing dilemmas.
 
MPO’s January/February feature, “Inventive Interaction,” explores the various forces at play in medtech R&D. Dan Alesi, global vice president of engineering at NN Inc., was among the various experts interviewed for the story. His full input is provided in the following Q&A.
 
Michael Barbella: Where are companies spending their research dollars now—on incremental improvements to existing devices, or game-changing innovation?
Dan Alesi: Medical device innovation is heading toward higher precision, less invasive therapies that provide for improved patient care. Areas ripe for growth are earlier detection, diagnoses and treatment before the disease spread and require major open procedure surgery. Note: Today, approximately 70 percent of surgery is still performed open due in part because the disease was not detected at an earlier stage.
Robotics and digital surgery are seeing major growth opportunities and filling a clear need. Robotic surgery allows for improved visibility and the ability to perform critical surgical steps that few could perform by hand. Laparoscopic surgery allowed for many surgeries, but not all, to be performed with improved efficacy. It was not until robotics took hold did we see improved outcomes in LAR, prostectomy and OBGYN surgery. Digital surgery is also a growth area because if can quantify the surgical steps of procedures performed by surgeons with the best outcomes (intra-op, post-op, procedure time, least complications, etc.), you may be able to standardize the best practices and guide surgeons around the world on how to have the best outcomes.
 
Barbella: How is value-based healthcare shaping the kinds of medical devices/technology being developed?
Alesi: It’s all about risk. If you can develop new technology that reduces surgical risk and provide better outcomes, your technology has a chance to become common practice. Part of the risk is also cost. The cost of the new technology must justify the improved outcomes. I believe early technology may cost more than current standard of care, which should be acceptable, but it has to show potential that is can serve patients around the world at an affordable cost as future innovation occurs.
 
Barbella: Please discuss the importance of university/academic partnerships in developing cutting-edge medical devices.
Alesi: University/academic partnerships are key to help drive scientific breakthroughs. Academic partners offer a different skillset in that they can innovate with deep expertise in a given space while industry tends to create engineering solutions with their insights. It can be a great collaboration.
 
Barbella: Are startups better suited than their mid-size or large OEM cohorts to develop medical technology that addresses value-based healthcare solutions? If so, how? (Or, if not, why not?)
Alesi: Tough question. The cost of entry into medical technology, especially if you plan to sell you own product, is steep. The regulatory, clinical, reimbursement codes and path to market is tough. Small companies may be better suited to develop in a space knowing that if their product claims add value, that larger companies with a global sales reach in place may be the best path.
I do feel though, that true innovation is more suited to smaller to mid-sized companies. The larger companies tend to spend many of their resources on protecting and caring for their current portfolio. To maintain quality, delivery and cost, especially when shareholders are focused on quarterly results, sometimes front-end innovation can become second priority. The technical brainpower in large companies, rightfully so, may be more conservative and less likely to take on risk needed to build a product portfolio beyond platform extensions. Many large companies have internal innovation, separate from the main business, to allow for internal innovation.
 
Barbella: Can a company effective tackle a healthcare need/problem and devise a solution based on its own internal R&D? Please explain.
Alesi: Absolutely, whether in a small company or large, understanding the unmet need and reducing patient risk/improved outcomes is key. Everyone who understands the disease state has a shot at innovating and being successful. The only difference in a large company is that they need to separate the R&D activities from the main sustaining business but still hold R&D accountable with clear milestones based on technical assumptions that need to be answered.
 
Barbella: What is driving the need to outsource medtech R&D? Does the R&D process even need to be outsourced?
Alesi: It is difficult, no matter how you try, not to let the sustaining engineering culture effect R&D innovation. When large companies create a front-end innovation group, many fail to be competitive because many of the large corporate norms still apply. If you are a front-end group but are constrained by who you can collaborate with, only use approved suppliers and overall have to adhere to large corporate policies, chances are the internal R&D innovation will struggle. This is why many outsource or use both internal and outsourced medtech.