An overflow crowd came together in Orange County on February 21 for the BIOCOM Medical Device event, “Medical Devices at the Crossroads: A Look Back and A Look Into the Future.” Sponsored by 321 Medical Launch, guests were treated to the insights of David Cassak, Vice President, Content, Managing Director, Medical Devices, Elsevier Business Intelligence.
Mr. Cassak gave a brief historical perspective on the traditional business model for medical device companies, transitioning over a decade into an industry where small companies grow to a certain size and then are acquired by larger companies. He observed that this model originally came out of the early to mid 1990’s, when venture capital dried up for medical device companies and larger companies, facing their own growth problems, came to the rescue of the smaller companies. During this time, said Mr. Cassak, the medical device industry was about “small ‘r’ and big ‘d’”, meaning less research and more emphasis on development when compared to pharma/biotech.
The device industry rebounded in a big way, fueled by quick, efficient and largely incremental product development, a predictable regulatory pathway, and ready acceptance of new technologies by physicians. The past several years have been marred, however, by increasing regulatory uncertainty, increased competition within certain spaces, and by the economic recession.
Mr. Cassak cited data that the medical device industry has likely weathered the worst of the recession and remains strong, and shared his view that drug/device convergence will continue to change the face of the device industry, and that more specialty pharma companies will enter the device space as a way to enhance their profiles within their specific expertise (but likely will not move beyond those boundaries). He also cited continuing challenges, such as the increasing tendency for physicians to be employees of health systems, changing the physician-patient relationship, and the cost cutting pressures that implementation of federal health care reform will produce.
“ We were very fortunate to host David, a widely recognized visionary within the medical device industry,” said Joleen Schultz, co-chair of the BIOCOM Medical Device Committee and Principal at 321 Medical Launch. “He reiterated many of the challenges that we are all experiencing such as a challenging funding environment, difficulty working with the FDA, healthcare reform and a perceived lack of innovation. However, overall he expressed a sense of optimism about the device market in the coming years.”
Written by Jimmy Jackson, VP of Public Policy & Communications, BIOCOM