Living Innovation Blog
A blog about important topics for medical device and healthcare innovators.
3 Keys to a Higher Value Launch for IVD
By Amanda Brantner, Marketing Strategist
Launching a new IVD technology can involve many hurdles and risks, but investment dollars abound for technologies that can demonstrate significant value in the healthcare market. “Investment and fundraising in the healthcare ecosystem saw a banner first half of 2017, driven in part by advancements in artificial intelligence and machine learning for healthcare applications and a surge in Series A investments,” according to Silicon Valley Banks’ Healthcare Investments and Exits Report 2017. As these new technologies hit the market, the diagnostics industry is seeking innovation models with clear ROls that manage investor risk.
At the MedTech Conference 2017, industry leaders shed light on the diagnostics market and investment space in a panel entitled “Diagnosing Opportunity: Manufacturer and Laboratory Insights.” The panel included Kristin Ciriello Pothier, Global Head of Life Sciences at Parthenon-EY, Scott Garrett, Senior Operating Partner at Water Street Healthcare Partners, LLC, and Tracy MacNeal, President of XimedicaDx & Executive VP Corporate Development at Ximedica, LLC. (For more information, be sure to follow @Ximedica and @XimedicaDx on Linkedln.)
Their perspectives offered three major takeaways to an important question: How can a new or small company in IVD be sure to maximize their technology’s potential and investment value?
1) Maximize Your Market Edge Through Design
Understanding where your technology fits into the market and in the portfolios of big players can provide crucial insights to your product design. “This is really about understanding the usability of the technology before launching it,” suggests MacNeal. She continued, “Don’t overdesign - focus on what’s special about your technology” and the need it solves, not only in diagnostics and patient outcomes, but also in the framework of the portfolios of industry leaders. Identify what critical problem are you helping solve and design around it.
Garrett also included an important point, that an “overall reduction of skills in the lab ...requires systems and products that require less skill, [which can be] a burden for small companies.” Your product design should take into consideration the changing dynamic context of the diagnostic laboratory, the usability, and the ability to integrate with existing technologies that may also be in play. “Industrial design and human factors are increasingly more important for these new stakeholders,” Mac Neal reminds us, indicating the need to minimize the burden on not only the user, but also on the development of the product.
(To learn more about how to incorporate user experience into Diagnostics design visit: http://www.ximedica.com/index.php/solutions/casestudy/high-speed-diagnostic-system)
2) Be Prepared for Due Diligence
When large companies are making an acquisition, they are often entering a new space in diagnostics, and there may be “misunderstanding and misinformation of how the technology works in the marketplace,” says Pothier, “and the need for evidence is more and more important for payers.” If your company is working towards an exit via acquisition, you need to be prepared to present the strength and value of your technology, not just as a standalone product, but in the scope of the entire healthcare ecosystem and the portfolio of the buying company. Garrett added a separate point about due diligence, that “tensions between regulatory pathways and reimbursement risk need to be considered and managed to prove clear value and benefit in the diagnostics landscape.”
(To learn more about how to create value in your products in the context of the larger healthcare ecosystem visit: https://www.youtube.com/watch?v=FwC_e6mGQjk&feature=youtu.be
It can be easy to become hyper-focused on the specifics of your technology, but remembering to bring in the larger perspectives of the industry can be fruitful preparation for the due diligence involved in launching the product into the market.
3) Be Transparent and Get Help
Finally, be transparent. “Be honest about what you know, but curious about what you don’t know” MacNeal advises. “Transparency [is] a willingness to manage expectations. It’s really important to be honest. In the end, it is honesty that builds a true ROI.” If you take the time to uncover where your gaps are and be active in filling them, you can enhance your value. Investors are putting a high value on life science and diagnostics companies right now, but competition is high, so it is key to take initiative in identifying ways to accelerate and push an even higher value in your launch.
While it may be difficult to face weak spots in your product or technology, seeking out partnerships and collaborations could strengthen these areas. Getting help not only supports the aspects you are already addressing, but can further uncover areas where more value can be brought to light. Overall, honesty and realistic expectations will set the stage for the most successful entrance to the market and to foster the best return on investment.
Conclusion : Now What?
As MacNeal states, this is an “opportunity for small companies to be disruptive without being distracting.” Startups can take advantage of this exciting time in investing and fundraising and launch their technology with its highest value potential. Key points are to design these products to amplify their market edge and to prepare for the due diligence involved. CEO’s should be honest and transparent with stakeholder expectations, even if that means getting some help. The diagnostics industry is looking for strong return on this surge of investment, so entrepreneurs have a wealth of opportunities to start maximizing value.
Read more about how Ximedica has helped maximize investment and drive value for our molecular diagnostics clients in this case study: http://www.ximedica.com/index.php/solutions/casestudy/molecular-diagnostics