A report by PricewaterhouseCoopers
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.
Some of these companies are non-traditional players that are entering healthcare. The medtech industry has always viewed innovation as the critical element of success, and its importance continues to grow. While 64% of executives surveyed by PwC’s Health Research Institute (HRI) view innovation as a competitive necessity today, 81% believe it will be in five years. But the innovation machine is not working like it used to. Download the report from PWC to find out why.
Source: PwC Medtech Innovation Survey 2013