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Articles from 2016 In December

How To Nip Problems In The Bud The Endologix Way

Endologix's approach of stepping out in front of its manufacturing problem stands in stark contrast to that of Olympus, which swept a major safety concern under the rug.

Amanda Pedersen

All manufacturers run into snafus from time to time, but what sets one apart from another is how the management team reacts to the situation.

Two recent Qmed stories, posted just a week apart, show a stark contrast between an organization that appears to have swept a major safety concern under the rug, and another company that stepped out in front of its problem and took a proactive and transparent stance to nipping it in the bud. 

Mum's The Word

In the case of Olympus Corp., the company's duodenoscope drama has been a story with a lot of twists and turns over the past couple of years, and the latest chapter unfolded last week after three of the firm's top executives invoked their Fifth Amendment right against self-incrimination when asked about internal company emails tied to the scope issue.

Granted, as one legal expert told Qmed, it is not uncommon for executives to plead the Fifth in these cases. Such situations can be complex, and there are "always facts beneath the surface of every case that the media and public doesn't see until we get to trial," said Mark Duval, president and CEO of Duval & Associates, a Minneapolis-based law firm that specializes in FDA regulations for products at all stages of the life cycle. "No defense lawyer would allow an executive to talk to the government without iron-clad immunity."

While Duval is not involved in or able to comment on the Olympus case, he added that anyone dealing with the prosecutorial arm of the government is "justifiably wary."

Still, the lesson to be learned here should be about how to address problems when they occur, not after the company has landed in hot water over it.

"Olympus in Japan knew of the dangers of the duodenoscopes not being able to be adequately disinfected, even when Olympus guidelines are followed, yet they failed to notify healthcare providers in the U.S. of this problem," Rando Wick, a lawyer representing Seattle-based Virginia Mason Medical Center in the case, told Qmed.

Taking The Proactive Approach

Irvine, CA-based Endologix Inc. executives seem to have a very different approach to crisis management. Earlier this week, after routine product testing uncovered a manufacturing glitch related to a top-selling product, Endologix put a hold on all devices that could possibly be impacted by the issue, and hosted a conference call to discuss the problem with analysts and shareholders.

Today, the company lifted the hold on most of the endovascular products for abdominal aortic aneurysms (AAA), after narrowing the problem down to select sizes of the AFX2 endograft system, which are still being held. Endologix also said it would host another call Friday to answer questions about its internal investigation.

"Wish it didn't happen of course, but we felt once we identified it we needed to put the product on hold and just be very proactive. So that's what we're doing," CEO John McDermott said during Tuesday's call.

Likewise, it was clear from McDermott's comments that he understood the value of transparency, both with stakeholders, and with regulatory agencies.

"My experience with the FDA is that they appreciate when companies take a proactive stance," McDermott said. "Oftentimes companies may take more time to process it, and in some cases these things get bigger."

That's why, he said, the company handled the problem in the manner that it did, even as it was still gathering information and running further product tests to isolate the glitch.

"We feel it is just the best and most appropriate move for the patients," he said.

Amanda Pedersen is Qmed's news editor. Reach her at [email protected].

[Image credit: Pixabay]

Appeals Court Decision a Step Back for Medtronic

The Eighth Circuit Court of Appeals has vacated a district court summary judgment granted to Medtronic in 2015, putting a securities fraud class action suit related to the company's INFUSE product back on the table.

An appeals court has vacated a district court summary judgment for Medtronic in a securities fraud class action suit involving the company's INFUSE product.

In a December 28 judgment, the Eighth Circuit Court of Appeals in St. Louis vacated a September 2015 summary judgment granted to Medtronic in the U.S. District Court for Minnesota.

That district court summary judgment was a win for Medtronic, as it dismissed all securities fraud claims regarding its INFUSE Bone Graft brought by a group of investment and retirement funds. The INFUSE product is a bone morphogenetic protein that originally received FDA approval for use in lumbar spinal fusions. Controversy around off-label use led to multiple INFUSE-related lawsuits for Medtronic.

The original lawsuit against Medtronic, company officers, and senior managers, was filed on June 27, 2013. In that case, the district court summary judgment was granted on the basis that the plaintiffs had not filed their suit soon enough, because of a two-year statute of limitations after discovery of the alleged violation. The funds behind that original suit--West Virginia Pipe Trades Health and Welfare Fund, Employees' Retirement System of the State of Hawaii, and Union Asset Management Holding AG--appealed the district court's summary judgment on a scheme liability claim.

Citing legal precedent, the appeals court documents note that "discovery" of an alleged violation also includes "those facts a reasonably diligent plaintiff would have known." The Circuit Court determined, "While Appellants may have had reason to be suspicious of Medtronic's conduct concerning INFUSE prior to June 27, 2011, we conclude that a reasonably diligent plaintiff would not have discovered facts sufficient to plead scienter based on public information existing prior to June 27, 2011."

That determination means that the plaintiffs were deemed to have brought their original lawsuit within the two-year limit. The appeals court decision remands the case back to the Minnesota district court.

Eric Epperson, senior public relations and communications director at Medtronic, said in an email statement, "We're disappointed with the decision, but continue to believe the claims in this case are without merit. The plaintiffs are still a long way from proving liability in this case, and we are prepared to defend ourselves in court."

Shawn Williams, JD, partner at Robbins Geller Rudman & Dowd LLP, a firm representing the plaintiffs, said in a news release, "We are pleased that the Eighth Circuit Court of Appeals reversed the dismissal of the action and affirmed that the statute of limitations did not run until the lead plaintiffs Employees' Retirement System of the State of Hawaii and Union Asset Management Holding AG could discover facts sufficient to constitute a violation of law."


CDRH’s Guidance Goals for 2017

CDRH’s Guidance Goals for 2017

CDRH has publicized its resolution list for the new year, issuing an A-list of its top priorities for final and draft guidance in fiscal year 2017

On the list of top subjects to tackle are 12 final guidance topics and four draft guidance topics. These include final guidance on titles like "510(k) Third Party Review Program" and "Design Considerations and Premarket Submission Recommendations for Interoperable Medical Devices," as well as both draft and final guidance on "New or revised procedural guidances for MDUFA IV implementation," among others.

CDRH also published a B-list of topics that it hopes to issue if possible, as well as a links to final guidance documents from 1977, 1987, 1997, and 2007. These older guidances are expected to be reviewed with an eye to whether any of them should be revisited or withdrawn.

Hear FDA's Rochelle Fink explain "How FDA/CMS Parallel Review Can Work for You" at MD&M West in Anaheim, Feb. 7-9, 2017.

One key issue missing from CDRH's A-list this year? The draft guidance topic on Medical Device Decision Support Software (also called Clinical Decision Support Software), a topic that was part of the FY2015 and FY2016 lists. CDRH has not yet published draft guidance on the topic and its plans to do so may have been impacted by The 21st Century Cures Act, which was signed into law this month.

Section 3060 of the 21st Century Cures Act is focused on regulation of medical software and outlines five low-risk categories of medical software that will fall outside of FDA regulation, barring any safety concerns.

Brad Thompson, JD, MBA, general counsel of the Clinical Decision Support (CDS) Coalition and a member of MD+DI's editorial advisory board, told MD+DI that in order to be regulated by FDA under The 21st Century Cures Act, CDS software cannot be "transparent." He explained in an email that "transparent" software would allow a physician to "see through the software to the underlying patient data and the clinical logic applied by the software, such that the physician is not required to rely on the software."

CDS Coalition hopes FDA will still address the guidance topic. Thompson outlined three key issues the group is looking for in such guidance:

  1. FDA's risk stratification and delineation of regulated versus unregulated CDS software
  2. FDA's plans to apply the concept of "transparent" software
  3. FDA guidance on CDS software related to pharmaceuticals

"The guidance is more important now than ever before," Thompson wrote.

Otherwise, the Center did publish on almost all of its FY2016 A-list topics, except for two final guidance subjects--UDI Direct Marking, and Laboratory Developed Tests (LDT). FDA is reportedly delaying final guidance on oversight of LDTs in order to work with the incoming Trump administration.

In 2016, CDRH issued 34 final and 23 draft guidance documents. The Center has not slowed its pace at year end, publishing three final guidances--all listed on the FY2017 A-list--in the final week of December.

Here is CDRH's full A-list and B-list:

"Prioritized medical device guidance documents that the Agency intends to publish in FY 2017 ("A-list")

Final Guidance Topics

  • Postmarket Management of Cybersecurity in Medical Devices
  • Medical Device Accessories: Describing Accessories and Classification Pathway for New Accessory Types
  • Design Considerations and Pre-market Submission Recommendations for Interoperable Medical Devices
  • Factors to Consider When Making Benefit-Risk Determinations for Medical Device Investigational Device Exemptions
  • Suggested Format for Developing and Responding to Deficiencies
  • Benefit-Risk Factors to Consider When Determining Substantial Equivalence in Premarket Notifications [510(k)] with Different Technological Characteristics
  • Use of Standards in FDA Regulatory Oversight of Next Generation Sequencing (NGS) - Based In Vitro Diagnostics (IVDs) Used for Diagnosing Germline Diseases
  • Use of Public Human Genetic Variant Databases to Support Clinical Validity for Next Generation Sequencing (NGS) - Based In Vitro Diagnostics
  • Infectious Disease Next Generation Sequencing Based Diagnostic Devices: Microbial Identification and Detection of Antimicrobial Resistance and Virulence Markers
  • Use of Real-World Evidence to Support Regulatory Decision-Making for Medical Devices
  • 510(k) Third Party Review Program
  • New or revised procedural guidances for MDUFA IV implementation

Draft Guidance Topics

  • IDE Submission, Content, Organization, Interactions
  • Update to Section V Demonstrating Insignificant Risk of an Erroneous Result in the Recommendations: Clinical Laboratory Improvement Amendments of 1988 (CLIA) Waiver Applications for Manufacturers of In Vitro Diagnostic Devices guidance
  • Dual 510(k) and CLIA Waiver
  • New or revised procedural guidances for MDUFA IV implementation

Device guidance documents that the Agency intends to publish, as the Agency's guidance-development resources permit each in FY 2017 ("B-list")

Final Guidance Topics

  • Evaluation and Reporting of Age, Race, and Ethnicity Data in Medical Device Clinical Studies
  • Medical Device Development Tools (MDDT)
  • FDA Categorization of Investigational Device Exemption (IDE) Devices to Assist the Centers for Medicare and Medicaid Services (CMS) with Coverage Decisions
  • Unique Device Identification: Direct Marking of Devices
  • Technical Considerations for Additive Manufactured Devices

Draft Guidance Topics

  • Standard Content and Format for Patient Labeling of Medical Devices
  • Standard Content and Format for Healthcare Provider Labeling of Medical Devices
  • Patient Matched Instrumentation for Orthopedic Devices
  • Utilizing Simulated Animal Transplant Models to Evaluate the Safety of Perfusion-based Organ Preservation Devices
  • Strategy to Assess the Credibility of Computational Modeling Studies
  • Related Replacement Reagent and Instrument Policy
  • Unique Device Identification System: Defining the Labeler
  • Considerations to Support a Claim of Electromagnetic Compatibility for Medical Electrical Equipment and Medical Electrical Systems"

[Image courtesy of ANNCA/PIXABAY]

Three Ways Exact Sciences Is Winning Insurers Over

Stool test maker attributes insurance coverage success to value proposition.

Amanda Pedersen

Humana recently joined a growing list of commercial insurers that now cover the Cologuard stool-based cancer test from Exact Sciences Corp.

There may not be an exact science to getting payers to cover new technology, but having a strong value proposition seems to be a good place to start.

Don't miss the MD&M West conference and expo, February 7-9, 2017, in Anaheim, CA.

Here's how Exact Sciences Corp. is presenting a three-pronged value proposition to get commercial insurers to pay for its Cologuard stool-based cancer test. The strategy recently worked with Humana Inc., which will cover Cologuard in 2017 without asking members for a co-pay.

  1. Quality of care. According to the company, Cologuard can help close the care gap by increasing screening with a test that's 94% sensitive for early-stage cancer.
  2. Member satisfaction. Exact Sciences said the test is one that "patients are actually demanding," which means insurers that cover Cologuard could boost member satisfaction.
  3. Economic value. Exact Sciences said Cologuard can impact insurers' bottom line by helping doctors detect cancer earlier, which reduces the cost of care in the long run.

By agreeing to cover Cologuard as an in-network service, Humana members will be able to use the test and its wrap-around compliance service without a co-pay.

"We believe this decision by one of the nation's largest health insurers reflects a growing understanding that Cologuard can detect more cancers earlier and reduce costs in the health system," said Kevin Conroy, chairman and CEO of Exact Sciences.

The company said the test is now covered by a cross-section of health plans with more than 153 million members. This is an increase of more than 50 million members since June, when the U.S. Preventive Services Task Force included Cologuard as an A-rated service in its updated colorectal cancer screening guidelines. This means more than 68 percent of the test's addressable population are enrolled in plans that cover it, the company noted.

FDA approved Cologuard in August 2014.

Amanda Pedersen is Qmed's news editor. Reach her at [email protected].

[Image credit: Exact Sciences Corp.]

This Is How Varian Spinoff Could Get Big Fast

Varian's imaging spinoff isn't even final and the new company is already making deals.

Amanda Pedersen

Varex Imaging is kicking off its growth strategy early

Varian Medical Systems Inc.'s medical imaging spinoff is putting its cart before its horse - for good reason.

Don't Miss The MD&M West 2017 conference and expo, February 7-9, 2017, in Anaheim, CA.

While its split from Varian won't be final until January, Varex Imaging Corp. has already agreed to snap up PerkinElmer's medical imaging business for $276 million. The deal is expected to close sometime after the spin, and kickstarts the company's growth strategy.

"Overall, the deal sets Varex well heading into the spin early next year, and will likely be the first of many tuck-ins as it executes a roll-up strategy of smaller players in the space," said Anthony Petrone, an analyst with Jefferies Equity Research.

The company shared its M&A goals in late November, suggesting it would cast a wide net to catch select upstream deals alongside one to two tuck-in acquisitions a year, according to Petrone. This strategy is intended to help Varex achieve above-market growth.

The PerkinElmer deal in particular should beef up the new company's digital flat panel x-ray business, and accelerate its profitable growth with more than $140 million in new revenue, according to Varian.

Sunny Sanyal, current president of Varian's imaging components business who has been picked to head up Varex after the spin, said the acquisition will add new imaging solutions and provide the new company with additional cross-selling opportunities. It will also expand its footprint in the industrial imaging sector, and strengthen the company's manufacturing productivity, Sanyal said.

PerkinElmer's Santa Clara, CA-based medical imaging business has about 280 employees and also has operations in Germany, the Netherlands, and the United Kingdom.

Like Varian's spinoff, the acquisition hinges on regulatory consents.

The new company plans to expand its bank credit facilities by about $600 million to finance the PerkinElmer acquisition. Salt Lake City, UT-based Varex has also agreed to transfer roughly $200 million in cash to Varian as part of the separation.

Varian's imaging business generated about $600 million in fiscal year 2016 revenue. Sanyal said Varex will be a growth business with strong cash flow to support a debt level at nearly three-times fiscal year 2016 proforma EBITDA, including both businesses.

For PerkinElmer, the divestiture will allow the company to focus its investments and accelerate growth in higher priority areas, according to the company's chairman and CEO, Robert Friel. Similarly, the spinoff frees Varian up to focus on cancer treatment products.

Recent OEM and foreign exchange headwinds in the medical imaging sector have been tough on profits for both Varian and PerkinElmer, according to Petrone.

"Our understanding is that the business carries a similar profit profile to Varex, which we assume will emerge in the 16% to 17% range post-spin," he said, adding that the assumption factors in additional overhead.

The spinoff, which will be structured as a tax-free distribution to Varian shareholders, was originally supposed to close by the end of the year, but regulatory hurdles pushed the timing out to January.

Amanda Pedersen is Qmed's news editor. Reach her at [email protected].

[Image courtesy of Pixabay.]

The Healthcare Cyber Threats to Worry About in 2017

A report points out that hijacking of medical devices and broader use of ransomware both increased in 2016, and warns of the new healthcare cyber risks coming in 2017.

Looking back on cybersecurity in healthcare in 2016, researchers determined that both the practice of medical device hijacks and the wide use of ransomware became more commonplace this year.

Frightening as that trend may be, security experts from TrapX Labs, a division of TrapX Security, Inc., predict more unparalleled cyber attacks in 2017 and an increasing focus on Internet-of-things (IoT) connected medical devices.

According to findings reported in "Health Care Cyber Breach Research Report for 2016," from TrapX Labs, there were 93 major cyberattack data breaches reported in 2016, a 63% annual increase. The report also lists the biggest healthcare data breaches of the year, including attacks at Banner Health, Newkirk Products, Inc., and 21st Century Oncology.

"Sophisticated and persistent cyber attackers, are, in our opinion, the single greatest threat to the protection of patient-health care data, critical health care operations and, ultimately, present a direct physical risk to patients," Moshe Ben Simon, cofounder and vice president of TrapX Security, said in the report.

In 2017, the report expects ransomware attacks, which took place more frequently at large and mid-sized healthcare centers in 2016, to hit smaller and mid-sized practices as well.

"Ransomware will grow to unprecedented levels in 2017 across global health care institutions," the authors wrote. "Given the rapid ROI [return on investment] for this attack and the easy access to non-traceable money (such as bitcoin), this automation makes it relatively easy for moderately sophisticated attackers to deploy attacks in much greater volumes."

Cyber criminals are expected to continue expanding this range to facilities like imaging centers, surgical centers, diagnostic labs, and skilled nursing facilities too, the authors wrote.

Don't miss MD&M West in Anaheim, February 7-9, 2017.

Medical devices have already been identified as a potential source of weakness to be exploited by hackers. Perhaps more worrisome are the new methods of entry cyber criminals may have at their disposal. The TrapX experts highlight connected medical devices that have IoT capabilities as a potential new target. Just how big is this target? The report notes that there are more than 6.4 billion IoT medical devices estimated online in 2016.

"Most IoT devices manufactured today have no integrated cyber defense and do not allow third parties to install security software . . . manufacturers recommend that security for IoT devices be achieved by installing it behind a firewall, which is absolutely no longer a guarantee of safety in today's environment," the authors wrote.


Did Endologix Bite Off More Than It Could Chew?

Endologix seems to be taking a proactive stance to nip an AFX manufacturing glitch in the bud, but analysts wonder if the company's portfolio is just too broad. The company expects to share more details by the end of the week.

Amanda Pedersen

Endologix Inc. put shipments of its AFX system on hold Tuesday after finding damage to the graft material in certain larger sizes of the product that is more difficult to make.

Endologix Inc. management spent the holiday weekend investigating what CEO John McDermott called a "temporary manufacturing glitch" related to the company's top-selling device for abdominal aortic aneurysms (AAA). 

Don't miss the MD&M West conference and expo, February 7-9, 2017, in Anaheim, CA.

The Irvine, CA-based company put shipments of its AFX endovascular AAA and AFX2 bifurcated endograft systems on hold Tuesday after finding damage to the graft material in certain larger sizes of AFX2 that are more difficult to make, McDermott said.

Endologix shares (NASDAQ: ELGX) plummeted 26.70% ($1.92) Tuesday to close at $5.27, the lowest the stock has traded in more than five years.

The problem was discovered over the weekend during routine product testing, he said, and the company expects to share more information by the end of the week, after it completes its investigation. Because AFX and AFX2 share similar manufacturing processes, production of both products is on hold.

Endologix appears to be getting out in front of the problem and trying to "nip it in the bud," as McDermott put it during a conference call, but analysts took the news as the company's third strike in a matter of months. Since completing its $211 million merger with Trivascular Technologies Inc. in February, Endologix has been hit with a CE mark suspension of AFX in Europe, plus FDA delays on its hotly anticipated Nellix endovascular aneurysm sealing system.

"We all understand the merits of having a broad, if not the broadest, portfolio in AAA, but with this announcement, and recent updates on Nellix and AFX in Europe, you have to wonder whether this portfolio may be too broad for you," said Matt Blackman, of Stifel, Nicolaus & Co. Inc., during the Endologix conference call.

It was a fair comment, McDermott said, but not likely the case. "This is just an unusual situation. I wouldn't read too much into our capability of managing our portfolio," he said. "These particular devices that we identified are historically more challenging to load, and we've put in some good product improvement processes over the years, but occasionally see excursions."

FDA approved the original AFX system in 2011 and Endologix released the AFX2 earlier this year. Vaseem Mahboob, the company's chief financial officer, said the products being held by this shipment hold account for about 65% of the company's total global sales.

"The good news is we caught this internally, this didn't lead to any outside events, so that's why we're confident we can turn it around and fix it," McDermott said. "Wish it didn't happen, of course, but we felt once we identified it we needed to put the product on hold and just be very proactive."

This issue does not impact the company's Ovation ix abdominal stent graft system or Nellix, McDermott said. He also emphasized that the problem is not related to any reported clinical events or the CE mark suspension of AFX.

McDermott said he does not expect the current manufacturing snafu to impact how soon regulating officials in Europe might lift the CE mark suspension, because the problem in Europe has to do with reported clinical events that may have been caused by an older generation of the AFX system.

Nellix, which is designed to treat patients with AAA located below the renal arteries, received CE mark in January 2013. Endologix had projected FDA approval for that device by early 2017, but in November the agency asked for two-year patient follow-up data from the company's IDE study. That, combined with a possible need for an advisory panel hearing, pushes the anticipated approval into the second quarter of 2018.

It is possible that hospitals have AFX and AFX2 devices that could have the same graft defect that kicked off this shipment hold, McDermott said, but the company doesn't provide a lot of inventory for hospitals to keep on shelves. Rather, he said, Endologix sales representatives take the product in as needed for procedures.

If the problem was found during a clinical case, McDermott said, it would be reported as a type 3B endoleak. But, he said, the company has not had a single report of such a leak from the 4,000-plus clinical cases completed with AFX2, and the reported rate of a type 3B endoleak is 0.19%.

To offer some perspective on how long this problem may or may not have been going on undetected, McDermott said the company completed a similar round of routine product testing over the summer that did not turn up any problems, and the AFX2 went through a thorough validation process before it was released earlier this year.

"I'm not trying to make any excuses, but I don't think this is anything more than just an unfortunate set of circumstances and timing, and we'll get it fixed as quickly as we can," McDermott said.

Meanwhile, the company's U.S. sales force is prepared to shift its focus to Ovation, which Endologix has plenty of inventory to meet any potential increase in demand that results from the shipment hold of AFX and AFX2. "Not how we planned it, but there will be an opportunity here for the team to accelerate their learning and capability with Ovation," he said.

Amanda Pedersen is Qmed's news editor. Reach her at [email protected].

[Image credit: Endologix Inc. SEC filing]

Stryker to Add Jobs in Michigan

The Kalamazoo-based orthopedics company is building a new $130 million corporate campus in nearby Portage and will add more than 100 jobs.

Jamie Hartford

Stryker Corp. plans to grow its presence in its home state of Michigan with a new $130 million corporate campus that's expected to create 105 jobs over the next three years.

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Set to break ground in late spring 2017 in Portage, not far from the orthopedics company's headquarters in Kalamazoo, the 485,000-sq-ft campus will include a customer experience center, showroom, lab space for R&D and other functions, as well as room for sales, marketing, and support staff for Stryker's growing medical instruments division.

The facility will be used as a destination for clinician training, Brent Lalomia, Stryker's vice president of quality and facilities, told the MiBiz website. In the past, he said, the company had to conduct such training in places like Chicago and Dallas.

The new jobs will be "high-wage, high-skill" positions, according to the website Xconomy, and the Detroit Free Press reported they will be filled by engineers and scientists.

Stryker had considered other locations in other states for the expansion but may have been swayed by incentives from the state of Michigan, according to the Detroit Free Press,. The company was awarded a $1 million grant for the project through the Michigan Business Development Program and may ask the state for more, the newspaper reported.

Stryker is only the latest medical device company to announce an expansion in December. Siemens Healthineers said earlier this month that it could double its workforce in Walpole, MA, over the next decade, and Johnson & Johnson expects to add 75 jobs in the first half of 2017 at a new health tech center in Rhode Island.

Jamie Hartford is the director of content for medtech brands in UBM's Advanced Manufacturing Group. Reach her at [email protected]


Technology Predictions: Sensors

Technology Predictions: Sensors

We asked industry experts to weigh in on what medical technologies will be big in 2017. Here's what to expect in the field of sensors. 

Craig Scherer

From expanded indications for transcatheter aortic valve replacement systems to bioresorbable stents, medical technology took some big leaps forward in 2016. So what might 2017 have in store? We asked industry experts for some predictions. Here, in their own words, are the medical technologies they expect to see making headlines in 2017. 


We'll be hearing a lot more about sensors in 2017. We hear a great deal about body-worn sensors, but sensors are being incorporated everywhere--not only because of the data gathering possibilities, but also the ability to drive better outcomes. Sensors are evolving at a staggering rate and are being made smaller, faster, more sensitive, and with lower energy needs than ever before. The applications are endless.

Besides the data potential, the main driver to developing disruptive sensor applications is to take the human variability out of treatment. This is not to say caregivers and clinicians will lose the control or physical feedback they need; instead, it will provide accuracy and consistency to devices and systems, enabling clinical users to make more accurate and informed decisions. Sensors will show up in places where human "judgement" and "experience" have been traditionally used to make critical treatment decisions.                

Learn about "Sensors: Staying a 'Step' Ahead of the Competition" at MD&M West in Anaheim, CA, February 7-9.

In the past five years, startups and early-stage companies have been developing and driving many of the medical device technology breakthroughs we've seen. Disruptive sensor technologies are no different. Briteseed has developed a smart surgical tool technology that employs a sensor within the jaws of laparoscopic dissector tools to help surgeons find and avoid hidden blood vessels, ureters, and bile ducts. Output Medical has developed its sensors and algorithms to automatically chart urine output, eliminating the need for a clinician to estimate the volume in the collection bag manually. Urine output is a significant indicator of overall health and the first indication of kidney failure for patients in the ICU. Finally, sensors provide "GPS" information on sub-dermal anatomy to physicians when inserting a spinal tap needle in the new IntuiTap Medical technology.

Those companies are just a few of the thousands of startups that are driving medical technology breakthroughs. We will see an explosion of acquisitions of these companies by all the big-name medical OEMs. Most large medical device companies have created groups focused solely on the vetting and acquisition of these technologies. We believe 2017 will bring with it record numbers of acquisition and licensing deals of these startups providing disruptive technology solutions for their innovation initiatives by OEMs.

Craig Scherer is the cofounder of Insight Product Development and director of Insight Accelerator Labs.

[Image courtesy of MC10]