Originally Published MX September/October
2002
EDITOR'S PAGE
It's Not All about the Money
Executives
are accustomed to thinking of business strategies in terms of their potential
effects on a company's bottom line. While others may think of their company's
activities in terms of factory space or delivery schedules, company leaders
have a responsibility to oversee the financial aspects of their business.
The habit of performing
such responsibilities may explain why many company leaders tend to discuss business
matters exclusively in terms of hard numbers, dollars and cents, profit (or
loss). For such corporate officers, product R&D has less to do with invention
than with investment, and intellectual property has less to do with a company's
achievements than with its assets.
When dealing with
extraordinarily complex issues beyond a company's control, however, adopting
such a viewpoint can become an impediment to understanding and coping with business
realities. One example of such an instance is provided in this issue's articles
focusing on reimbursement for medical technologies (The
FDA Approval and Medicare Coverage Processes
and Strategizing for Reimbursement)—an
area that has been of top concern to medtech executives for several years.
It is, perhaps,
a little too easy to think of reimbursement strictly in terms of the sales revenues
that a company might earn by gaining a favorable coverage decision. And by the
same token, it may be too easy to blame the Centers for Medicare and Medicaid
Services (CMS) when a company fails to make its earnings goals for lack of a
coverage decision. But both of these views would be wrong-headed. The bottom
line, in this case, is not the issue.
The real problem—as suggested by several of the participants in this issue's roundtable—is comprehension. While CMS's processes may be forever changing, medtech executives will navigate them best if they understand them. And that, truly, is the bottom line.
Copyright ©2002 MX
