COVID-19 Changed Diagnostics R&D Approach

The COVID-19 pandemic has created numerous healthcare challenges over the past two years—a gnarled supply chain among the most inhibiting—but it’s been quite a boon for medtech research and development.
 
The virus that has killed more than 6.5 million individuals worldwide led to a major boost in R&D spending in 2020, with the top 10 medtech companies collectively investing more than $15 billion, Evaluate Vantage data show. And while that figure rose to $17.4 billion last year, the financial  news analyst organization expects R&D investment to slow in 2022 and rise only moderately through 2028.
 
“However, even modest growth year over year represents a record level of spending,” David Stuart, Life Sciences senior analyst, director, wrote in a Fall 2022 Industry Outlook for RSM, a London-based accountancy network. “We expect the trend of record R&D spend will continue as companies jockey for technical superiority and the pace of innovation continues to accelerate. There are no viable substitutions; if medtech companies don’t maintain strong R&D spend, they risk being left behind in a highly competitive and segmented industry.”
 
Substantial R&D investment has long been tied to healthy product innovation and market capitalization. Whether R&D spending levels stay consistent or falter in the near future remains to be seen, but medtech firms will most certainly have maintain robust research and development pipelines to ensure their future success.
 
MPO’s R&D feature details the trends and market forces driving medtech research and development. Steve Maylish, chief commercial officer at Fusion Biotec Inc., was among the experts interviewed for the feature; his full input is provided in the following Q&A:
 
Michael Barbella: How has COVID-19 changed companies’ approach to R&D, if at all? Why did it change the approach to R&D?
Steve Maylish: I believe it has for companies working in the diagnostic space. The U.S. government has spent hundreds of millions of dollars on COVID-19 testing, and most of it to highly accelerate getting these tests to market. These accelerated timelines have put pressure on development groups to show working prototypes in a few months and commercialization not long afterwards. The standard way of doing development doesn’t work in this environment.
 
Barbella: In your observations and customer dealings, what areas of healthcare are companies focusing their R&D on (for example, diagnostics, cardio, robotics, etc.)? Why are companies investing in these particular areas?
Maylish: There has been a major outpouring of investment in 2021. This usually occurs for a number of reasons. For Fusion Biotec, we have seen a huge interest in diagnostics due to the COVID-19 crisis.
 
Barbella: In your observations/customer dealings, are companies allocating their R&D dollars more into transformational or incremental innovation? What is the reason (or reasons) behind their choice?
Maylish: Fusion has been asked to do transformational and incremental innovation. Much of it has centered around providing lab quality results in a point-of-care device. This can involve miniaturization, inventing a new way of applying an existing technology or providing a new technical solution.
 
Barbella: Is there an ideal or best R&D outsourcing strategy that companies should employ when pursuing new innovation?
Maylish: It’s always best to outsource to a company that is in your space, whether that is cardiovascular, robotics, diagnostics, etc. Also, if the company is able to reuse their technology or has a platform technology. This is only true if you are not locked into their technology, but rather have a license to use it royalty free.
 
Barbella: When does it make sense—if ever—NOT to outsource medtech R&D?
Maylish: It doesn’t make sense to outsource projects that a company considers their core competency or that a company wants/needs a high degree of control. Imagine an implantable Class III device that has special quality and regulatory requirements.
 
Barbella: What benefits do an academic partnership bring to R&D?
Maylish: The academic partnership is very valuable from a research standpoint. If most of the research is complete, the outsourcer can spend time on development and design for manufacturing.  
 
Barbella: How has virtual interaction benefited medtech R&D? Do you expect it to continue?
Maylish: Virtual interaction is valuable to speed project communication and keep companies up-to-date on the progress that the outsourcer is making. Besides Zoom meetings there are SaaS viewers, which allow team members to view drawings or schematics remotely and on various platforms (such as smartphones, tablets, laptops).
 
Barbella: How will approaches to R&D evolve in the future?
Maylish: SaaS software has made major inroads into R&D, but still has a way to go to gain major acceptance. Technology is constantly advancing, allowing for electronics development platforms, enabling hobbyists to prove feasibility, allowing higher level software coding, scripting for the software uninitiated, systems on a module for turbocharging electronics, etc.