Innovation is a constant in the device industry, and investments are expected to continue, despite general concerns about the economy. And while many industries have a dismal outlook for 2009, the attitude about the medical device industry remains more positive. “There’s no recession on innovation, and great ideas will still get funded,” says Mark Heesen, president of the National Venture Capital Association (NVCA; Arlington, VA). Last month, in NVCA survey of more than 400 U.S. venture capitalists, 24% said investment in the medical device industry would increase in 2009, while 38% predicted a stable investment.
Jonathan Rather, general partner and CFO of Welsh, Carson, Anderson & Stowe (WCAS; New York), says his firm has been lucky enough to have a lot of capital in a clearly beaten up market, which is to their advantage, because the next few years is certain to be a buyers market. The group, which invests solely in the business services and healthcare markets, is looking to get more involved in the medical devices sector. As a result, WCAS has brought Dan Pelak, former president of Closure Medical and Inner Pulse, on board. “From a private equity perspective, we have a good opportunity to be able to help a lot of firms out, and a lot of businesses out there are struggling for capital in some way,” says Pelak.
More information on this topic will be in MD&DI’s February issue.
AdvaMed’s board of directors unanimously approved an overhaul of the group’s code of ethics earlier this month. The amended code clarifies appropriate and inappropriate activity between AdvaMed members and doctors and other healthcare professionals (HCPs, as AdvaMed calls them). One provision that will likely send ripples through the industry is the prohibition of all gifts and entertainment for HCPs.
That means absolutely no gifts—including noneducational branded items like pens, mugs, notepads, etc.—regardless of value.
“This updated and more rigorous Code of Ethics reflects the medical technology industry’s ongoing commitment to openness, transparency, and high ethical standards,†said AdvaMed chairman Michael Mussallem in a statement.
PricewaterhouseCoopers LLP praises the new code as a driver of innovation, helping OEMs and physicians collaborate without appearing biased. “The code sets the right parameters for relationships with healthcare
professionals, and we salute AdvaMed’s members for their commitment to rebuilding trust through openness and transparency,” said Brian Riewerts, a partner at the company.
Read more about changes to the code at www.advamed.org.
Medical connectivity seems to be a hot topic of late. The Boston Globe just published a piece on the topic, describing the lack of connectivity between devices in an operating room, compared with consumer products.
Most telling in the story is commentary from Massachusetts General anesthesiologist, Jesse Ehrenfeld: “My bank can notify me via text message if my account has a low balance, but medical devices can’t let me know if my patient is having a critical event.”
John Conroy has written a piece for MD&DI on medical connectivity and the standard IEC 80001 that can help medical manufacturers incorporate connectivity into devices. Read the article in the January issue of MD&DI.
Sandy Weininger, with FDA told the Globe that the turning point may be the arrival of a revolutionary application, such as a medical version of an iPod, that changes people’s expectations of their devices. Weininger said. “As soon as you get the iPod . . . it just mushrooms.”
Bermuda-based Covidien is moving its incorporation to Ireland in 2009. The reorganization, as the company calls it, will create Covidien plc. The international expansion will provide “increased strategic flexibility and operational benefits,” according to president and CEO Richard Meelia. Covidien has been in Ireland for almost 30 years and already has five facilities that serve the medical device industry there. The company doesn’t expect the move to affect its financial results, or its U.S. operations or employees. The company has 42,000 employees worldwide and about 2000 at its U.S. headquarters in Mansfield, MA.
So, just a quick one today because we are in a holiday week. ECRI (pdf) listed the top 10 medical device problems in hospitals:
1. Alarm hazards.
2. Needlesticks and injuries from sharps.
3. Air embolisms from contrast media injectors.
4. Retained devices and fragments left in patients.
5. Surgical fires.
6. Anesthesia hazards due to inadequate preuse inspection.
7. misleading displays.
8. CT radiation dose.
9. MR imaging burns.
10. Fiberoptic light-source burns.
The anticipated 2013 opening of a 60-story, 1.5 million-sq-ft tower in New York City could bring new opportunities for the healthcare industry in a central location. The World Product Centre will feature state-of-the-art technology that enables companies to exchange information on site and remotely, in seven languages. It will be open to any organization that wants to do business in healthcare, including nonprofit and trade associations. Within device manufacturing participants, the center will focus on companies that sell finished medical devices rather than component manufacturers, but this doesn’t necessarily rule out those suppliers.
The current U.S. economic state might raise concern over such an ambitious plan. However, Michael Resnick, executive vice president of the World Product Centre, says it is a cost-effective tool that provides long-term financial savings. “The nice part of this project is that it’s five years until the doors open, so the financial commitment to secure the location is minimal and no risk,” he says, adding that the center has received a huge positive response from the companies it has been involved with so far.
The center is asking for a 10-year commitment. Companies that want to participate sign a license agreement, which gives them access to all building resources such as executive office space, media space for briefings and analyst presentation, and conference auditoriums for continuing medical education programs. Nearly 200 healthcare companies have been approached, and Resnick expects the first wave of participants to be announced soon.
St. Jude Medical Inc. (St. Paul, MN) has given a boost to its cardiovascular line with the $250 million purchase of Radi Medical Systems AB (Uppsala, Sweden). Radi Medical is a leader in two segments in which St. Jude isn’t involved. Its PressureWire Certus, a pressure measurement guidewire, accounts for 70% of the global market for physiological assessment of coronary lesions. The company’s FemoStop and RadiStop lines make up 60% of the worldwide market for manual compression-assist vascular closure devices. This year, RadiMedical is expected to generate about $80 million in sales (19% more than 2007). The company will become part of the St. Jude Medical Cardiovascular Division.
Abbott Laboratories says it has paid a closing purchase price of $175 million to buy the remaining equity ownership in Ibis Biosciences Inc. (Carlsbad, CA). Earlier this year, the company paid $40 million for a portion of Ibis’s equity, bringing the total cost of the acquisition to $215 million. In a press release, the vice president of Abbott’s molecular diagnostics company says that he believes that Ibis’ technology “has the potential to be a powerful tool in the detection and surveillance of infectious diseases in the hospital and clinical settings.â€
In other Abbott news, the company has started a U.S. study of a 2.25-mm size of its drug-eluting stent Xience V. The smaller stent system is already on the market in Europe, Asia, and Latin America. If the device earns FDA approval, it will be called Xience Nano in the United States.Â
What started as a class project could turn into a boon for tech-savvy couples expecting a child. An NYU grad student wanted to keep up with his unborn baby’s movement in the womb, so he created a pregnancy belt that does just that. The Kickbee is made of a stretchable band and features embedded electronics and sensors. Miniature piezo sensors attached to the band transmit small charges when they detect movement. A microcontroller sends the signals to a Java application via Bluetooth.
“Every time the baby kicks, it uploads a message to the server and I get a text message on my phone as well,” says Corey Menscher, the Kickbee inventor. He says that future iterations could update social networking sites such as Facebook, too.
For those who are curious, Menscher hasn’t received a grade yet. Ellen, his eight-months-pregnant wife, is expected to demonstrate the belt in her husband’s class this week.
Andrew von Eschenbach’s expected resignation is official. The FDA Commissioner told his staff that he plans to resign effective January 20, 2009.
The departure of von Eschenbach will intensify the search for a new FDA leader, which has become the focus of lobbying by industry, members of Congress, consumer-safety advocates, and women’s groups.
Janet Woodcock’s name has been floated as interim commissioner. On December 5, however, Representative Bart Stupak of Michigan asked President-elect Obama in a letter not to name any current FDA officials to acting or permanent posts.
The Wall Street Journal reports that von Eschenbach said the incoming administration is responsible for appointing an acting commissioner until Obama nominates, and the Senate confirms, a permanent FDA commissioner.
