PWC on Medical Device Development

While the United States has high health spending that plagues many individuals, companies and government programs, that same high spending has created many high income individuals and industry segments such as pharmaceuticals and medical devices that employ thousands of Americans in good jobs.  So there is some natural tension between actions to rein in health spending and keeping these profitable industries healthy.  PWC has issued a report called the Medical Technology Innovation Scorecard that examines global trends in the medical device industry.  (PWC Report)

Some of the key trends that PWC sees affecting the industry include a shift in determining what devices get used from physicians to payers and even patients, who are demanding different evidence of value and a trend to redefine innovation to include devices that are cheaper, simpler and even reusable.  The regulatory environment in the US has led to other countries often getting the benefits of new technology faster than Americans, creating a more attractive development environment.  This has led to a significant shift out of the United States for the global medical device industry, although developing countries in particular have intellectual property and workforce issues that may hamper their competitiveness.

PWC ranked nine countries, including the US, Germany, UK, France, Japan, Israel, China, Brazil and India, on five dimensions–financial incentives, resources for innovation, regulatory system, patient demand and capital availability.  The United States has the lead on this scorecard, but less so than five years ago.  The European countries are not far behind and  the emerging economies are beginning to gain.  Nonetheless, PWC expects the US to continue to lead in 2020 although other countries will have improved their position significantly.  The ideal for the US would be to continue to foster health industries that can create innovations that improve outcomes and lower cost; unfortunately most studies suggest that while better health often results, innovative devices have been a driver of spending increases.