Pondering the state of the semiconductor industry can help medtech professionals understand what a decrease in VC funding could mean for their sector.  It seems that medtech is a much riskier business than it once was. And as a result, many venture capitalists are keeping their distance from the sector. Or, at least, they are sitting back and waiting to see what the implications will be of the quickly changing regulatory landscape and healthcare reform. “I’ve hear it said that venture capital and private equity dollars are drying up,” says Dane Miller from the board of directors at Biomet in a recent piece by Indiana Public Media. “I don’t believe that to be the case; I think they’re sitting on the sidelines....
October 24th, 2011

This should not be much of a surprise to anyone, but according to research done by the Minnesota Independent, Representative Erik Paulsen (R-MN) has received quite a bit of cash from the device industry. The sources of Paulsen's campaign funding were documented by the online newspaper as part of its "Money Trail" series, which examines the financial ties of Minnesota politicians.

Apparently, Paulsen has been quite popular among executives from firms like Medtronic and Zimmer, as well as their political action committees (PACs). The write-up highlighted the contributions of inventor and industry champion Thomas Fogarty, who gave the maximum amount ($5000) to Paulsen's campaign.    

The reason that's not a surprise: Paulsen has been one of industry's most vocal supporters on Capitol Hill,...

October 21st, 2011

Updates: More comments from our experts came in over the weekend—they discuss an increased focus, how the investment market drove the decision, and also ask key questions about combination devices and how Abbott will divvy its talent.

Deepa Mahajan:

Abbott's decision to split up is purely financial (increase shareholders value), of course that is part of doing business. Moreover, there diversified medical products focus is emerging markets vs Pharmaceuticals Research unit is more for developed nations. The two units have different focus, and both are huge to sustain by themselves, so it makes good business sense to split the two so that they both can flourish in the desired environment.

Nancy Stark:

I think this is investor driven. What I mean is that investors place a different market value on device firms (which bear a 3.8% ...

October 20th, 2011

Last year at Stanford, Josh Makower, MD, the founder and CEO of Exploramed, gave a talk titled "The Perfect Storm in Medtech." Makower, who formerly worked at Pfizer and has four dozen patents to his name, raises the question whether it is possible to innovate at a large company. What he found is that not only is it possible but that a reproducible process can be developed to do so. 

He explains that there are a number of basic prerequisites, which include:

  • Access to customers.
  • A supportive environment that "accepts failure."
  • A good team of people who can work together.
  • The right resources.

Makower recommends working backwards, beginning with the goal in mind and deciding, as clearly as...

October 19th, 2011


 International CT Image Contest 2011, hosted by Siemens is taking place now. Winners will be announced at RSNA 2011 in Chicago. YOu can vote for your favorite CT images.

October 19th, 2011

Many medtech companies are faced with pricing pressures related to regulatory obstacles. Of course, there is a long history of conflict between FDA and the medical device industry. Complicating matters is FDA's recent conservative track record in approving devices. "Inconsistency" is a term that has also been bandied a good deal in describing review times. (UpdateCardiovascular Business just released a story explaining that there are now 10 bills in the house that are targetting the approval process for medical devices.)

Many medical device companies, perhaps even a small majority of them, have given up, at least for the time being, in having their products cleared in the United...

October 18th, 2011

We've given the Institute of Medicine's recommendation to nix the 510(k) process a fair amount of treatment on this blog. Just recently, for instance, we ran a piece by regulatory expert Neal Dunning proposing that the system be permitted to evolve to keep up with changing demands. Of course, the reason we've mentioned the IOM's recommendation to scrap the 510(k) so often is that it is still on many peoples' minds.

Dr. Thomas FogartyLast week, at the Medical Device Summit in Mountain View, CA, the topic came up again. Noted medical device inventor Thomas Fogarty, MD was asked for his opinion on the matter. He didn't exactly mince words in his response:

“'Institute of Medicine'—that’s what they call it, but I call it the 'Institute of Madmen.'”

October 17th, 2011

By Joe Pustka

In the United States, the move to change the tax on medical device manufacturers has received bipartisan support.Unfortunately, political pundits often misreport on the times when members of the U.S. Congress are still working together to align policies with common sense. One such case that deserves the spotlight is the bipartisan move to reverse the tax structure on medical device manufacturers where gross revenues, not net profits, are proposed to be the basis of taxes. This is not a minor bipartisan issue. It’s bipartisan—to the tune of Al Franken and Michelle Bachmann singing from the same hymnal!
It’s no accident that the representatives taking up this cause happen to come from two states where the medical device industry plays a significant employment role—Massachusetts...
October 17th, 2011

Great article by Richard Park on the current state of in vitro diagnostics. Park discusses global economics and ultimately says that most experts believe the sector will not be affected by the recession. He also explores the latest technologies in the space.

The article is an overview of products that represent the industry in instrumentation and automation, data and information management, point-of-care testing, immunoassays, and molecular diagnostics.

—Heather Thompson

October 17th, 2011

The 510(k) premarket notification process has served its function well, despite the Institute of Medicine's recommendation to replace it with what it termed an "integrated premarket and postmarket regulatory framework."

By Neal Dunning

As director of the Division of Small Manufacturers Assistance (DSMICA; originally Office of Small Manufacturer's Assistance (OSMA)) of FDA from 1979 to 1991, I watched and encouraged the development of the 510(k) process. Meanwhile, the classification process specified by the Medical Device Amendments of 1976 was proceeding, albeit slowly.

This division was also responsible for preparing the manuals published on the Good Manufacturing Process, the 510(k) process, regulation of medical devices, export and import of medical devices, and many other subjects, as well as...
October 16th, 2011