Thrice in two weeks I have been asked about general and open innovation trends in the medical devices sector.  If I was a suspicious person, I might think there must be something brewing in the medical devices sector.  Apparently there is.  Coming out of a recession, the growing talk around healthcare reform and the cost of providing healthcare appears to be forcing established medical device companies to think about new products while having  to cut costs or provide better performance. Economic pressures will no doubt become a major force driving innovation in the medical devices industry, a sector where higher cost, higher quality products have traditionally been more accepted.  Competitive pressure from lower cost operations overseas are exerting pressure on the industry as consumers demand more value for their healthcare spend and companies seek more value for their product development investments. A recent PricewaterhouseCoopers Medical Technology Innovation Scorecard report effectively compares and contrasts industry influence factors in 9 important markets and highlights that innovators are likely now going to market first in Europe and begin moving to emerging markets by 2020. In recent years, the FDA’s Medical Device Innovation Initiative aims to expedite innovative product approval.  This and the very recent repeal of the medical device tax may slow the tide and help the medical technology industry in America maintain some innovation dominance. 

Beyond the need to provide high quality devices at lower price or providing products with more features or improved designs that will reduce procedure times, provide better outcomes and shorter recovery times, the area of diagnostics and self monitoring continues to be increasingly popular as new product targets.  Home or self-care health systems will no doubt become more important as people desire or are forced to take more control of their own care. In fact, the FDA’s Center for Devices and Radiological Health (CDRH), which regulates medical devices, calls home-care systems and Integrated patient medical information systems so called e-health technologies "the fastest growing segments of the medical device industry."  One simply has to consider the incredible growth of smart phone medical apps offerings (nearly 80% increase in the second half of 2010). Smartphones are definitely changing healthcare for both consumers and providers alike and even creating a new crowd based medical services marketplace.  A recent California Healthcare report highlights many of these new innovative products and services and developing trends.  For hospitals, IT and wireless capabilities will continue to be a big needs focus.

Medical device companies must innovate faster and cheaper. Reaching outside and adapting the collective ideas and technologies from the crowd is a great way to achieve this.  Consider that roughly 2/3 of new medical technologies come from small entities such as physicians, start-ups/SMEs and university spin offs. Adding to that the collective technology and braintrust from other technical areas that could be tapped into to help accelerate medical device innovation and a great case for open innovation can be made.  The medical device industry expects the rate of open innovation adoption to begin to increase.  This is indeed a trend that NineSigma has witnessed as it continues to identify new diagnostic systems, new materials, new manufacturing approaches, coatings, sensors, IT and other enabling technologies to help provide new or improved medical device products for clients. No question, OI is a growing trend in the medical devices sector.   

What will the next iteration of open innovation look like in the medical sector?  Will it be open innovation platforms and services that can effectively integrate companies, small innovators, health care providers, patients and regulators? Will all who have a stake, or participate to advance innovation, gain or be rewarded by the experience? We will have to wait and see.