A gastroenterology expert explains the answers innovators must be ready to provide when it comes to questions about their device's value proposition.
Tom Shehab, MD, MMM
While the exact future state of health care can be argued, there is little debate that the field is undergoing an unprecedented degree of change. There is an increased focus on value within the health-care system and physicians are being pushed to meet challenging benchmarks. The definitions for quality and cost-effectiveness are both being reconsidered, and the standard for value is a moving target. Innovators—both from inside health care and many from outside traditional health-care fields—are focused on providing new tools and systems of care that will support the health-care delivery system of the future.
Outside of these global factors changing the field, each discipline has its own areas begging for innovation. In my own specialty of gastroenterology, 2015 saw an intense focus on filling the obesity management gap. Last year, FDA approved several minimally invasive balloon technologies for obesity treatment (Apollo Endosurgery, Reshape) in addition to a rechargeable system for vagal modulation for obesity (Enteromedics).
As we move forward, the burden of diseases such as inflammatory bowel disease and GI malignancy diagnosis and treatment will require significant focus on new devices, diagnostics, and novel models for the delivery of care.
|Get inspired to innovate during Massachusetts Medtech Week—register for BIOMEDevice Boston 2016, April 13-14.|
For future innovations to make their mark in both gastroenterology and beyond, innovators need to reconsider the approach to a number of the main components of the value proposition in order to gain traction with payers, investors, and strategic partners. Four components of the value proposition are particularly important with the current changes in health care: Who, What, Why, and How:
- Who is the actual buyer (payer, hospital executive, physician, patient) and what set of information do I need in order to prove value?
- What is the differentiation of my product and does it need to be both clinically superior to available options and demonstrate cost savings to be accepted?
- Why is this product compelling to the end user and why will it displace what is already being used in clinical practice?
- How would this product fit into a dramatically different payment model—bundled payments, capitation, etc.?
The innovators with the best chance of achieving success will not only address an important clinical need with a novel technology, but they will also have taken these questions into consideration when crafting their value proposition. The traditional combination of an elegantly engineered device/technology platform and a favorable cost-effectiveness study will not be sufficient to position a technology for success in a value-based payment system.
It’s an exciting time for innovation, and I look forward to seeing the innovators who can position their technologies to succeed in this rapidly changing health-care marketplace.
If you’re interested in hearing more about what’s happening in innovation in the digestive disease space, join me in Boston March 31 and April 1 for the 2016 American Gastroenterological Association (AGA) Tech Summit, where I'll be presenting. If you are new to innovation, attend AGA's How to Innovate in Digestive Health course on April 2, also in Boston.
Tom Shehab, MD, MMM,is a Principal at Arboretum Ventures, a healthcare focused Venture Capital firm in Ann Arbor, MI. Prior to this he was a practicing gastroenterologist and physician executive.
[Image courtesy of DREAM DESIGNS/FREEDIGITALPHOTOS.NET]