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Avoiding the Valley of Death: three ways to survive the leap from idea to products

By Joop Tanis, Director MedTech Consulting & Business Development

Health Enterprise East 

15th June 2018

The gap between idea and a successful product or solution is often called the ‘Valley of Death’ – a challenging time for innovators. There are, however, some practical steps that businesses and innovators in the medtech industry can take, and questions they can ask themselves, to recognise issues that will ensure they avoid getting stuck at the bottom of the valley says HEE's  Joop Tanis, Director of MedTech Consulting.
 


1. Who is my customer?

This should be easy, right? The customer of my product is who will be using and benefitting from it. Actually, this is at best only partially right. Unlike many sectors, in the medtech market there are at least three ‘customers’ to consider. The first is the person directly benefitting: the patient. This is the reason why we innovate. Their health improvement is at the forefront of our minds when developing new medtech products, but healthcare markets are complex, especially in the case of the NHS. So, apart from the patient, there are at least two other customers to take into account.

The second customer is the user. This could be the patient, but in many cases is a clinician: the doctor, nurse or other healthcare worker who undertakes the clinical procedure. Their needs, though ultimately aligned with the patient’s, can be very different. The clinical benefits are of course important, but so are factors like ease of use, willingness to change and where training is required. This, of course, includes ‘non-professional’ users like carers, family members and volunteers. If users are unwilling or unable to use the product, its purpose is lost, and the innovation wasted.

Thirdly, neither the patient nor the user may be paying for the product. In the complex NHS market, procurement is often in a different department or even a different organisation in the healthcare ecosystem. Their prime objective may be cost efficiency rather than ‘Gold Standard’ care, so their customer needs should be taken into account. Unfortunately, the needs, motivations and decision-making power of the three customers: the patient, the user and the payor, are often not aligned. Understanding this is key to getting a medtech product to market.

2. Know your cost, price and value

When developing new medtech it’s essential to understand the cost of research, development and production, the time it takes to get an innovation to market, and the price that needs to be charged to make the whole process commercially viable. This is basic manufacturing economics and most companies, including start-ups, are aware of the principles and methods to be applied.

However, healthcare is a complex market, with many factors determining purchasing decisions, especially affordability. It’s worth examining the factors at play here. Firstly, there is the simple cost of the product versus the alternatives. If the new medtech product essentially replaces an existing, similar product, it will need to be cheaper to buy or maintain.

Recent discussions on financing the NHS highlight the need to reduce cost and do more. Rapid development in healthcare technology means we’re capable of outdoing what was thought possible a few years ago, achieving much-improved health outcomes and quality of life. The public’s increased knowledge of these advancements and higher expectations of what therefore should be available, coupled with limited funds and capacity, mean that step-change innovation is essential to meet the challenges of today. Many procurement decisions are based on the answer to two questions: ‘is it cash releasing?’ and ‘does it increase capacity?’

For the first, it’s important to consider whether the medtech product will enable real savings. The obvious factor would be reducing the cost of purchase or maintenance of the equipment. But simply buying a cheaper version of existing technology is not enough. Can the new technology reduce the number of staff required to carry out a procedure, or lower training requirements? All these changes can be calculated to assess the new medtech solution. It’s important to remember that complicated processes such as clinical staffing and overhead costs mean that potential cost savings do not necessarily result in cash being released.

Perhaps more effective is to increase capacity. Recognising the need to do ‘more for less’, increasing efficiency and capacity in the system is essential. This could mean a simple time reduction when undertaking a particular intervention, or considering if an intervention could take place in less acute or even non-clinical settings. Given that improving outcomes for patients may not be enough to invest, consider assessing reductions in recurrences and subsequent procedures.

Thus, the traditional return on investment assessments do not necessarily apply here. The emerging science of Health Economics is developing tools and methods to calculate real and potential financial impacts of healthcare innovation, and it’s important to embrace this when developing medtech.

3. It’s not about the tech

This may seem counterintuitive. Surely it’s all about the technology? Medtech companies are – or should be, by definition – experts at developing technology. It’s essential that we get the technology right, but this isn’t the whole story. We have already seen that medtech innovation should be more than replacing like for like, more than creating a slightly cheaper syringe, or sharper scalpel. Medtech innovation should enable healthcare to be delivered in radically different ways, in different settings, using new methods, possibly by different people.

It’s sometimes said that if invention is creating new things, innovation is their adoption. This means that the technology is only one element of medtech innovation, and maybe not the most difficult aspect.

Developing new technology takes dedication, trial and effort, resources and time. Once the technology is developed, tested, refined, perfected and manufactured, the objective is achieved and, because it is so much better than anything else, people will buy it, right?

Wrong. We’ve explored some of the factors that enable those who pay to buy the product. But what about the ‘system’ in which the new product will be used and integrated, and the people essential to making those changes happen? The many theories on reluctance or even resistance to change, often seen as imposed rather than as an opportunity, apply here as much as anywhere.

So, for innovative medtech to be successful, it’s essential to gain a detailed understanding of how clinicians and other healthcare personnel work, and how the technology can enable them to work differently, deliver better job satisfaction and better healthcare for patients. This includes regulatory requirements and constraints, alongside clinical standards, clinical practice and clinical care pathways that are often long-established and change-resistant. It even includes clinical training and professional standards. It’s important to remember that, as the developer of innovative medtech products, it’s up to you to do this work and, with this knowledge, gain the understanding and collaboration of the clinicians and users. Without it, the product will surely fail.

Can anyone succeed? Well, nobody said it’d be easy, and it won’t be. But using some or all of the practical suggestions highlighted above, from the start of the development process, and not as an afterthought, will make the journey easier, more enjoyable and hopefully more successful. In time, you’ll be able to tell others just how you avoided the ‘Valley of Death’.