FOCUS AREAS
MEDTECH
Medical technology helps advance human development through disease prevention, employment growth, and increased longevity. Medical technologies enable the early and accurate diagnosis of health problems, facilitating timely intervention and improving outcomes.
Five facts about new medical technology under this paper.
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New technologies do, on average, improve the quality of medical care by improving health outcomes. This is not true of every technology in every clinical use, but it is true on average.
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Many new technologies are ineffective or redundant and do not improve health outcomes. The trouble is that it is not always easy to discriminate between effective and ineffective technologies at the time they are introduced.
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New technologies do, on balance, add to health care costs. Some technologies may actually reduce costs by replacing more expensive alternatives or preventing expensive health consequences, but the overall effect is to increase costs.
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The incentives and regulations built into the American health care sector lead to inappropriate diffusion of technologies, both under diffusion of effective and cost-effective technologies, and over diffusion of ineffective and cost-ineffective
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Inescapable fact about new medical technology is that the American public cannot get enough of it. We demand the best and newest from our providers, and they are, in general, happy to oblige.
Prioritize future growth and drive business transformation:
- Continue a "human-centered" approach, prioritizing patient care
- Leverage data and digital technologies effectively
- Validate the resilience and agility of supply chains
- Increase commitment to sustainable business models
- Push for regulatory reform to support the industry's ongoing evolution
Areas
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Development of new treatments for previously untreatable terminal conditions, including long-term maintenance therapy for treatment of such diseases as diabetes, end-stage renal disease, and AIDS.
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Major advances in clinical ability to treat previously untreatable acute conditions, such as coronary artery bypass graft.
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Development of new procedures for discovering and treating secondary diseases within a disease, such as erythropoietin to treat anemia in dialysis patients.
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Expansion of the indications for a treatment over time, increasing the patient population to which the treatment is applied.
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On-going, incremental improvements in existing capabilities, which may improve quality.
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Clinical progress, through major advances or by the cumulative effect of incremental improvements, that extends the scope of medicine to conditions once regarded as beyond its boundaries, such as mental illness and substance abuse.
Global Medical Device Market Share, By Type, 2020
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24%
annual growth rate
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16%
portion of GDP
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$800B
estimated revenue by 2025
Over the course of 2020, the industry's revenues (+6.3% to US$446 billion) grew for the fourth consecutive year, with the non-imaging-diagnostics segment recording a particularly impressive 24% annual growth rate. Healthcare spending as a portion of GDP has more than doubled from 7.2% to 16% of GDP, effectively rising from $75 billion to $2 trillion in just thirty-five years. Pure-play medtechs reinvested heavily in R&D in 2020, recording the highest annual growth rate in R&D spending (+17%) since before the financial crisis of 2007, and reaching an estimated revenue of nearly $800 billion by 2025.