Obama's Reelection and the Fate of the Medical Device Tax

With Barack Obama back in the White House, many medical device manufacturer are stepping up their efforts against an upcoming medical device tax hike. The 2.3 percent medical device tax is part of the president's Affordable Care Act. Many healthcare companies were hoping that a Romney victory would see the death of this tax. Since his platform argued against healthcare reform, many felt that the former republican candidate would see an end to the 2013 tax increase. With Obama's second term, healthcare reform will proceed unfettered. However, some device manufacturers remain optimistic that the tax can be repealed before it hits next year. According to the ACA, the medical device tax will impose a 2.3 percent fee on the sale of all medical devices. This even includes companies that have not made a profit. Under its current structure, companies will begin to pay the tax only a few weeks after its inception in January, 2013. Since many consider the time between election day and the seating of a new Congress a "lame duck" period, medical industry lobbyists will be pushing hard for repeal during this time period. However, the window to get the upcoming tax hike repealed is closing rapidly. References http://www.massdevice.com/news/medical-device-tax-after-election-high-hopes-repeal

Medical Device Manufacturers of the Year 2012

Medical Device Manufacturers of the Year 2012

In narrowing the field of candidates for this year’s Manufacturers of the Year, MD+DI’s editors kept one thing in mind: the rising cost of healthcare in the United States.

MD+DI's Medical Device Manufacturers of the Year are Sotera Wireless, AirStrip Technologies, and Proteus Digital Health.

Although healthcare spending has slowed considerably since 2009, medical costs are still projected to jump 7.5% next year, as they have for the past three years, according to a recent PwC Health Institute report. To put the problem in perspective, consider that in the 12 months ended this past September the cost of medical services grew at more than twice the rate of overall inflation. Moreover, the passing of the Affordable Care Act and all of the attention paid to the issue of healthcare spending in this election year are proof that policymakers and the public are well aware of the healthcare crisis and determined to do something about it.

At the recent OCTANe Medical Device & Investor Forum, in Irvine, CA, medical device investor Thomas Fogarty was asked which areas of medical technology will see the most interest from venture capitalists. His response: “Anything that can do more for less. We haven’t really been focused on doing more with less, but we’re going to be required to, so why fight it?”

The three companies we chose as our Manufacturers of the Year aren’t fighting that mandate; they’re embracing it. They rose to the top of our list because their patient-monitoring systems promise to improve outcomes, make medical care more efficient, and ultimately cut costs out of the healthcare system. They are each achieving that goal with unique technologies that will finally usher the medical industry into the digital age.

We chose Sotera Wireless, AirStrip Technologies, and Proteus Digital Health as MD+DI’s 2012 Medical Device Manufacturers of the Year because what these companies are doing today will change the way medicine is practiced tomorrow.

Medical Device Manufacturers of the Year 

Sotera Wireless

AirStrip Technologies

Proteus Digital Health

Other Finalist Companies


Related Content

2011 Medical Device Manufacturer of the Year

2010 Medical Device Manufacturer of the Year

2009 Medical Device Manufacturer of the Year

2008 Medical Device Manufacturer of the Year

November 15 Webcast on Dealing with FDA’s Changing Compliance Environment

A FREE event will take place on November 15, at 2 pm ESTDealing with FDA in a Changing Compliance Landscape aims to help medical device regulatory personnel, the company's quality team, and product life cycle managers tackle the challenges facing compliance issues in an ever-changing compliance landscape.

Experts Alan Schwartz and Christine Hansen will discuss what FDA's new compliance posture means for the medical device industry. Attendees will receive tips on how to respond to FDA 483s and how to prevent getting Warning Letters. They will also get practical advice on Agile technology, traceability for end-to-end systems, and eliminating wasted processes and procedures.

About the Speakers
Alan Schwartz, mdi Consultants, Inc., has 40 years of FDA regulatory experience. He has been providing strategic planning on FDA regulatory compliance issues since 1978. Prior to mdi, Alan was a supervisor of field operations for FDA. He has been an invited speaker on FDA policy and issues both in the US and internationally.
Christine Hansen is manager for product marketing, manufacturing and supply chain management at Epicor Software Corp. She joined Epicor as part of the DataWorks Corporation merger in 1995. In her current position, Hansen is responsible for the product marketing and direction of various Epicor product suites. 

About the Event

UBM CanonMD+DI, MPMN, Qmed, Plastics Today, Packaging Digest, PMPN, and Design News and are proud to kick-off their “MedTech Trends in 2013” Webcast Series.  The first in the series, sponsored by Epicor & mdi Consultants, will focus specifically on Dealing with FDA in a Changing Compliance Landscape and offers in-depth analysis and discussion from experts in the industry. 

Eye Tracking System Can Help Doctors Diagnose Health Issues

Tobii Technology, a global leader in eye tracking and gaze interface integration, recently announced that its eye tracking technology has been integrated into i2Eye Diagnostics' portable, easy-to-use Saccadic Vector Optokinetic Perimetry (SVOP) system. The SVOP system can be used by healthcare professionals to assist in the diagnosis and management of a variety of neurological and ophthalmic health issues. In addition, the SVOP system can be a valuable tool for a variety of different research applications. The SVOP system uses Tobii's proprietary eye tracking system to reduce patient eye strain. In addition, automated eye tracking can help reduce patient stress while he or she is being diagnosed. The SVOP has the potential to be a powerful tool for opthamologists and other healthcare professionals. Proper assessments are essential for detecting a variety of different neurological disorders. This can include neurological conditions like brain tumors, stroke and more. In addition, the SVOP can be used to indicate whether patients may have an abnormal blind spot, a lesion in an optic nerve and more. Since traditional assessment methods require patients to remain still for an extended time, they may not be appropriate for all patients. The SVOP's eye-tracking technology can prevent this common problem. In a prepared statement, CEO Henrik Eskilsson stated, "This solution is a significant step for the medical community as it continues to realize the benefits of eye-tracking applications for research, diagnosis and patient care." He continued, "We are excited about how i2Eye has moved from researching the diagnostics field to bringing a complete solution to the medical market, and we look forward to furthering our mission to enhance the adoption of eye tracking in the medical field." References Tobii Technology http://www.tobii.com/en/group/news-and-events/press-room/#/pressrelease/view/eye-tracking-solution-helps-doctors-diagnose-critical-conditions-810930

To Succeed, Digital Health Must Unify

A century ago, most people relied on newspapers to keep abreast of current events. Radio broadcasting took off 1920s, followed by television broadcasting in the following decades. Of course, the Internet has changed the equation again in the 1990s and early 2000s, by providing yet another option to access information with extraordinarily flexibility and timeliness. More recently, the explosion of mobile devices and social media have given billions of people a greater variety of options for accessing and sharing information than has ever existed in human history. There’s been a downside to this as well: more noise and fragmentation. A similar trend can be observed in the nascent field of digital health, where there are ever-more apps and other products vying for consumers' attention.

A growing number of entrepreneurs, developers, and established medtech players have realized that there is tremendous potential in digital health. As X PRIZE chairman and CEO Peter Diamandis, MD has put it: “Today, my car, my airplane, my computer knows more about its health status than I do, which is insane.”

One of the X PRIZE’s aims is to help address this problem by offering substantial cash awards to innovators that can help change this equation and usher in a future “in which the fundamental health parameters of my body are constantly being monitored 24/7 as well as the air I breathe, the food I eat, the environment I walk through,” Diamandis says. “There are no more excuses for not knowing about something. You have the data and the data analysis to become the CEO of your own health.”

As we march towards a world where we, as individuals, have an unprecedented access to health metrics, there is an increasing need to tie this information together and to motivate patients to act on the information they have. At the moment, millions of people across the country know that, for instance, there are risks associated with smoking and obesity. The problem is—how do people get and stay motivated over the long-term?

As the digital health industry evolves, it must grapple with this basic question. Healthcare needs more unification. More of a team-based approach where patients and physicians with different clinical specialties work together to improve outcomes. This remains a challenge today in a world where, for instance, EMR systems don’t offer full interoperability.

Also consider the fragmentation observed in the Quantified Self movement, where consumers track a number of health metrics. Today, you could buy a FitBit to track your activity level, a Withings blood pressure monitor, a Zeo sleep monitor to keep track of your sleep. You would have a separate dashboard for each application. It might be worth marrying someone from tech support, Scanadu’s Walter de Brouwer quipped at the Burrill Digital Health Meeting earlier this year on this topic. As De Brouwer also explained: “the connected medical consumer doesn't want to watch his device he wants his devices watching him.” And they also want some help interpreting all of the data and tying it all together.

Brian Buntz is the editor-at-large at UBM Canon's medical group. Follow him on Twitter at @brian_buntz.

What the Election Results Mean for Medtech

What the Election Results Mean for Medtech

The results of the 2012 U.S. election essentially means a continuation of the status quo in the federal government. Barack Obama secured his second term as president, Democrats continue to hold a majority in the Senate, and Republicans still control the House of Representatives. For the medical device industry, that likely means the medical device tax isn't going anywhere fast. 

Image by Resizia, via Wikimedia Commons.

"President Obama's reelection and the split majorities in both houses of Congress are likely to mean that efforts to repeal or modify this legislation will unfortunately remain difficult," Don Beery, executive director of the West Michigan Medical Device Consortium, a collaboration of more than 30 medtech companies in the state, told MD+DI via e-mail. "At this point we have to assume the legislation, and the tax, will continue as written."

Other industry organizations expressed equally sober predictions about the future of the 2.3% tax on medical device sales, which is set to take effect January 1, 2013.

"In the absence of any major changes at the federal level, we anticipate that there will continue to be issues surrounding healthcare reform legislation that impact our membership community, such as the medical device excise tax," Ryan Baird, director of marketing and communications for Minnesota-based medtech trade association Lifescience Alley, wrote in an e-mail.  

But Mark Leahey, president and CEO of the Medical Device Manufacturers Association (MDMA), struck a more hopeful tone.

“The election results make it clear that Americans want bipartisan solutions to the challenges confronting our economy, and that elected officials should remove barriers to innovation and job creation," he said in a statement. "Repealing the medical device tax is a perfect example where there is broad, bipartisan support in Congress to do just that, and MDMA remains laser-focused to accomplish this goal." 

"Repealing the medical device tax is a perfect example where there is broad, bipartisan support in Congress..."

While Mitt Romney will not be able to make good on his promise to repeal the Affordable Care Act (ACA)—and with it the device tax—on January 20, 2013, there was good news for the industry in this year's election results.

At the very least, the election results let the industry know, to some extent, what it can expect for the next four years.

"For an industry accustomed to uncertainty, the 2012 election results, coupled with last summer’s Supreme Court ruling upholding the ACA, paint the clearest picture yet of the future of the U.S. health system," says a PwC Health Research Institute report on what the 2012 election results hold for the healthcare industry.  

Key medical device industry supporters, including Rep. Erik Paulsen (R-MN), Sen. Amy Klobuchar (D-MN), Sen. Orrin Hatch (R-UT), and Rep. Fred Upton (R-MI), also held their seats in Congress. All support repealing the medical device tax.

Sen. Scott Brown (R-MA), who cofounded the Senate Medtech Caucus and has been a staunch supporter of the medtech industry, lost to Democratic challenger Elizabeth Warren, but she, too, has called for repealing the device tax.

"Even though we’re losing a real strong ally in Sen. Scott Brown...we feel comfortable with her position in continuing that fight," says Tom Sommer, president of Boston-based industry group MassMEDIC.

Unless the tax is taken down in the upcoming lame duck session of Congress, as some have hoped, the industry's best bet to rid itself of the medical device tax is to continue to work with its legislative allies toward that goal.  

Our industry, and the hundreds of thousands of patients whose lives are improved as a result of our products and services, needs to raise its collective voice during this legislative term," Matthew Jenusaitis, president and CEO of the Southern California-based industry group OCTANe, said in a statement. "Being vocal has led to a lot of progress over the past few years, and there is plenty of additional headroom for continued improvement."

 Jamie Hartford is the associate editor of MD+DI. Follow her on Twitter @readMED

Related Content:

Medtech in an Election Year Digital Edition 

Spider Silk's Optical Properties Could Further Medical Device Development

Pristine silk fiber integrated into a photonic chip. The fiber connects three light-holding disks. When light is injected into one of the disks, it propagates along the silk to the other two. (Image courtesy of Nolwenn Huby)

Research conducted by scientists at Tufts University (Boston) and the CNRS Institut de Physiques de Rennes (France) demonstrates that natural silk could be used to manipulate light. The Tufts team is using the information they have gathered to create proteins that rely on silk's optical properties for implantable sensors, while the Rennes team is using pristine, natural spider silk to guide light through photonic chips. This work could eventually lead to the development of silk-based biosensors and implantable medical imaging devices.

Silk is famous for being one of the strongest fibers in nature, in addition to being biocompatible, biodegradable, and durable. However, the material has also been found to be a manipulator of light, which can travel through silk almost as easily as it flows through glass fibers.

Led by biomedical engineer Fiorenzo Omenetto, the Tufts group is developing silk-based materials that look like plastic but retain the optical properties of pristine silk. His team is exploring the possibilities of using silk to integrate a technological component with living tissue. "We're thinking of how to scale up [production], how to interface with current technology," Omenetto says. He hopes some of the more 'gadget-like' fruits of his labor will be commercially available within the next five to 10 years.

As a light guide, silk works in a way comparable to glass microfibers that carry light within a chip. However, spiders produce silk that is ready to use, while glass microfibers have to be heated to high levels and carefully sculpted. Led by physicist Nolwenn Huby, the Rennes team integrates silk into circuits. By integrating real spider silk into a microchip, the researchers have found that the material is able not only to propagate light but also to direct, or couple, light to selected parts of the chip. Huby hopes that this work can be used to create biosensors that can detect the presence of a molecule or the activity of a protein.

As a result of its research, Huby's team hopes to develop devices for use by biologists and medical professionals. In addition to serving as a component in biosensors, spider silk could also provide a light source for taking pictures inside the body. Because of its great strength, natural silk might be able to convey light into the body through a very small opening, providing a less-invasive way to perform spectroscopy-based imaging or chemical diagnoses.

Flambeau Makes $2.5 Million Investment to Enter Medical Device Market

Flambeau Medical Markets Group (FMMG) recently announced that it will invest $2.5 million in its medical device contract manufacturing business. This is part of the company's plan to expand group sales to $100 million by 2020. Tom Star, VP of sales and marketing for the FMMG, stated, "That would be about 500 percent growth from where we are today." Flambeau Medical Markets Group was formed in 2011 from Flambeau Inc. Flambeau Inc. is a group that concentrates in plastics injection molding and is part of Nordic Group of Cos. Ltd. For its new manufacturing operations, Flambeau Medical has been able to acquire a new facility next to its manufacturing facility based in Phoenix, Arizona. Flambeau Medical is also building an ISO Class 7 clean room with injection molding presses. In a recent phone interview, Star stated, "Our target is to have it operational by March 1." He continued, "We just took possession of the building last week. This will be our first thrust into making medical devices. To contain contamination risks and achieve the quality we need for our customers, we wanted the manufacturing in a building that was separate from the current building where we do industrial molding and tooling." According to ranking data from Plastics News in 2011, Flambeau is in the top 25 blow molder companies in the United States. For the fiscal year ending on June 30th, 2012, the company had sales of $105 million. References http://www.plasticsnews.com/headlines2.html?id=26947

USC Body Computing Conference 6.0: Big Ideas for Personalized Health

Leslie Saxon speaks at this year's Body Computing Conference

The conference, now in its sixth year, brings together speakers from all over the medical industry, and many from outside, to discuss innovation in wireless healthcare. And the message is clear: The future of healthcare is in placing patients’ health in their own hands and better informing doctors through mobile, Internet-enabled devices; Big Data; innovative technologies; and even video games.

“There’s a big opportunity in the middle for public health,” said panelist Eva Ho, vice president of marketing and operations at Factual, a company that works to make patient data available via application programming interfaces. Right now, a good deal of healthcare focuses on the very sick, and there’s a ton of technology helping elite athletes achieve optimum performance. But what about the rest of us—the weekend warriors, those dealing with chronic conditions, and the everyday people who just want to live healthier lives?

In her opening remarks, Leslie Saxon,  MD, who organizes the conference and acts as executive director of the USC Center for Body Computing, stressed several principles on which the future of healthcare should be based: data liquidity, making patient data more transparent, personalized medicine, wireless technology, close partnerships with academics and industry to foster innovation and growth, and creating a culture of responsibility for patients and their own health. Thomas Jackiewicz, senior vice president and CEO of USC Health, affirmed this sentiment saying, “We have to become experts in managing data.”

Big Data and the so-called “quantified self” were heavily buzzed-about topics. In a panel discussion, Eric Horvitz, of Microsoft Research, outlined the potential for a machine active learning system that uses data culled from a variety of sources to facilitate patient care. “We can learn to make devices more sensitive and active in the data they’re seeking,” he said.

Search logs from Google, Twitter feeds, and even GPS information can all be used in a form of predictive modeling to monitor and even prevent patient disease. “People with symptoms are running Google and Bing searches,” Horvitz said. “Smartphones can be directed to look for diseases and conditions based on [search] data.”

On a personal scale, such technology can be used in predicting patient illness. On a larger scale, search data like this could be tagged with GPS information to provide tracking and reporting data on the spread and occurrence of diseases. Imagine your phone predicting an onset of a disease or serious condition and alerting you and your doctor,  and later even predicting a return to the hospital based on your habits.

The challenge is amassing a quantity of data to make such a thing possible. “Data itself is a challenge,” said Chris Wasden, managing partner at accounting firm PricewaterhouseCoopers. “Currently, there are only about 200,000 patients being remotely monitored. The challenge is in getting the data across a large, diverse group.”

But even with the availability of all this data and its corresponding technology, there is still another significant hurdle to overcome: the patient. While wireless health purports many innovative and cost-saving solutions for patients and clinicians, there’s also a question of motivation to be addressed. How can we incentivize and encourage patients to track their health metrics over the long term? Telling a patient that it’s important is one thing, but it’s quite another to create a habit out of it, or to get the patient excited about the prospect of sharing such data with healthcare providers and practitioners.

For Sonny Vu, founder of Misfit Wearables, the solution is to be as unobtrusive as possible. Vu and his team are looking for a different kind of sensor, one that is wearable, comfortable, and “doesn’t make me look like Iron Man,” he said. Having previously developed a now-available glucose meter that plugs into the iPhone, Vu believes the next step in computing technology is wearable. Misfit Wearables, which is expected to launch a Kickstarter campaign as soon as this month for its first line of products, is seeking to create wearable technologies and sensors for medical applications and beyond.
“I think a great wearable product is something that a lot of people would wear all the time for a long time,” Vu said. For him it’s not about competing with other sensor products. Misfit is focused heavily on the wearability aspect. “We focus on some of the key challenges in making wearables, like long battery life and low cost,” he said. “We’re competing against a $6.99 t-shirt at Walmart.” Imagine a t-shirt or other article of clothing that is stylish, comfortable, and capable of transmitting vital data about the wearer. It’s perhaps a tall order for Vu and his company, but one they are confident in approaching.
Other companies are working on more immediate products and solutions—ones that could even work for young patients. Avery Dennison, manufacturer of the Metria wearable body sensor, has partnered with Vancouver, BC–based Ayogo Games to offer unique user experiences to encourage and reward healthy behaviors in patients. Staffers from both companies were on hand to demo a game, “I [heart] Jellyfish,” which uses sensor technology to reward patients for real-world exercise with in-game awards.

A screenshot from the I [heart] Jellyfish game

Using the game, a clinician can set an exercise program for patient. The patient, wearing the Metria sensor, then performs the exercises and is in turn rewarded with currency in the game that allows for longer play. The only way to advance in the game is to get up and move around in the real world. In fact, other companies, such as London-based Six to Start, are taking this idea of “gamification” seriously as a means of encouraging patient activity. The company’s mobile game “Zombies, Run,” which uses a zombie narrative to get players to physically run, is already a hit, with more 150,000 active users.

There are currently about 40,000 medical apps available. Add to that another estimated 150,000 consumer health apps and an estimated $1 billion in investment over the next year, and it’s clear that the digital health space is a frontier as large as it is exciting. While it may be a while before the annual doctor visit becomes a thing of the past, it’s clear that a growing number of patients want access to their health data and are willing to accept accountability for their own health. Though at the rate things are progressing, it may not be a question of when this accessibility will be granted, but whether consumers will notice it at all.

Chris Wiltz is the assistant editor at MD+DI


Harnessing the Heartbeat to Power Pacemakers

Once implanted, a pacemaker can stay in the body for about five to 15 years before its battery life runs out. At that point, a surgeon must replace the battery or insert a new pacemaker. Such procedures could be averted entirely, however, if pacemakers drew power from the heart beat itself. Researchers at the University of Michigan have concluded that the heartbeat could supply 10 times more than enough piezoelectricity to power a current generation pacemaker. The technology could also be used to power devices such as implantable defibrillators. 

Interestingly, the research was a spinoff from research to power wireless sensors from the vibration of aircraft wings. The technology works by harvesting energy from the vibration of the chest cavity that is a result of the heart beat. That vibration can then be captured and transduced into electrical energy. Led by M. Amin Karami, PhD, a research fellow in the Department of Aerospace Engineering at the University of Michigan, the researchers are using the money from a grant from the university's medical school to develop a prototype device using data gathered from open-heart surgeries. 

 Brian Buntz is the editor-at-large at UBM Canon's medical group. Follow him on Twitter at @brian_buntz