European regulatory change, big data, cybersecurity, global trends and new sources of funding were just some of the issues considered at the MedTech Strategist Innovation Summit (17th-19th April) held in Dublin, as Janet Fricker reports
At the MedTech Strategist Innovation Summit a session on EU regulatory change emphasized how the now more stringent regulatory environment for CE marks could have a detrimental effect on European medical technology. The event was attended by nearly 500 delegates including small start-up companies, strategic companies, venture capitalists and service providers all looking for partnering and investment opportunities. Delegates came from around 25 countries, with the global reach of the meeting emphasized by attendees from countries beyond Europe, including US, Canada, Australia, India, Singapore, Israel, Japan and China.
David Cassak, Editor-In-Chief of MedTech Strategist, and the Summit’s host, said, ‘We’ve been holding our European partnering conferences in Dublin since 2013, as Ireland punches well above its weight offering a phenomenal environment for device development and company creation.’
The spotlight session heard how in addition to safety and performance data medical device companies in Europe will soon be required to provide clinical evidence to achieve a CE mark. ‘We anticipate that time to market in Europe will increase by one year,’ said Serge Bernasconi (MedTech Europe). He added that while the stimulus for change is patient safety there are concerns that patients could die while waiting for devices to come to market.
Additionally, companies will be required to provide new clinical evidence for devices that have already received their CE mark. A survey of European medical device companies by MedTech Europe, said Bernasconi, indicates that ‘40 per cent of respondents plan to discontinue marketing some medical device products.’
European changes, said Joseph Gatewood (AdvaMed), have converged with the FDA becoming more lenient in their requirements for medical devices. ‘The average time for an FDA decision is now down from 467 days in 2013 to 209 days in 2017,’ he said.
Chas Taylor (Veryan Medical) told a session on commercialization challenges for an evolving Europe that there is likely to be a ‘sea change’ in the current European/US divide. He predicted that by 2020 around 50 per cent of device companies would be doing their first-in-man studies in the US.
Brexit, said Gatewood, would add an additional layer of complexity for Europe. ‘Around 25 to 40 per cent of CE marks have been obtained through UK Notified Bodies, creating concerns that UK decisions may soon be worth nothing in Europe,’ he said. Furthermore, he added, without trade agreements import taxes from the UK could push up European prices.
In a keynote session Annika Grosse, from IBM Watson, provided insights into how the healthcare industry is being transformed by big data and AI. Grosse described a number of initiatives including big data being used to predict patterns indicating sepsis, identify drug adverse effects, predict the next block buster and scan the literature to identify interactions between genes and proteins. But the technical revolutions need not be limited to large companies, she said. IBM Watson is currently developing game-changing apps that will enable small start-up companies to access big data.
A session on cyber security provided serious pause for thought. ‘Cyber security breaches are not about if, but when,’ said Carol Murphy (EY). She added that in reality most med tech companies will have already experienced breaches in their data. Medtech cyber security, the session heard, can be considered at two levels, security for the end users (ie patients), and security for devices connected to larger systems (such as hospital networks). ‘You’re only as strong as your weakest link, and if products aren’t secure this can open up the entire network including every patient,’ warned Anita Finnegan (Nova Leah).
Breaches have an impact on market value of organisations. ‘If you can’t develop confidence around cyber security you’ll start to be at a competitive disadvantage because someone else will be getting ahead of the curve. Potentially you could be locked out,’ said Finnegan.
The summit highlighted France as a new ‘hub’ of entrepreneurial activity providing medtech with an excellent environment. Much of the credit, speakers felt, could be laid at the door of BpiFrance, the French public investment bank that provides early stage private equity investing and seed round money. Frank Bozsak (Sensome), an engineer originally from Germany, said that BpiFrance had provided his company with a ‘no strings’ €200,000 in start-up fund which enabled them to hire four engineers and do first in-animal studies.
A perennial question is whether early investment performs better than late stage. ‘Early stage is more about CE marks, while the late stage is more about sales,’ explained Thom Rasche (Earlybird Venture Capital). Jacques Essinger (Polares Medical SA) said that end-stage investors in their mitral valve technology made far bigger returns than early-stage investors, who made a return. In contrast, middle-stage investors barely got their money back.
One of the challenges faced by start-ups is how to find new sources of funding as VCs sit back. ‘We’re seeing different types of investors including family offices, angels and some strategics now have their own VC divisions. There are examples of companies that get investment from one strategic and then sell to another,’ said Cassak. Yuval Binur (Mitralign) highlighted the ‘tremendous’ potential that exists for markets in China. The culture between the US and China, he said, was that in the US it takes two or three meetings to build trust compared to two or three years in China.
Reviewing trends shaping global medtech John Babitt (EY Americas) said that 3D printing and AI offered the potential for cost savings, and there was a lot of activity in wearables. Personalised medicine, he added, offers great opportunities for medtech with over 800 deals made in 2017 in the area. ‘We’re experiencing shifting sands in the industry with the possibility that companies like Amazon could enter the health care space,’ he cautioned.
A highlight on Wednesday was the European round of the MedTech Innovator competition where eight companies (ranked highest out of hundreds of European entries) pitched medical devices to the audience. The competition had an additional component where four of the most promising earlier stage companies competed to win travel expenses to the US and an assured place as one of the 50 companies (out of 720 entries) in the coveted MedTech Innovator Showcase. This annual list of the top emerging companies in the medtech industry are exclusively chosen based on interest from 10 corporate partners to present to the two largest gatherings of medtech industry leaders in North America this year – the Wilson Sonsini Medical Device conference in San Francisco (June 21 – 22, 2018) and The MedTech Conference powered by AdvaMed in Philadelphia (September 24-26, 2018) where the competition finals are held with an overall first prize of $350,000.
The Dublin stage was won by Lucy O’Keeffe (Dublin, Ireland) who presented the Croívalve repair technology to treat the tricuspid valve. Other finalists included:
Paul Grand the CEO of MedTech Innovator said, ‘We’re a non-profit organization financed by industry which is trying to find and accelerate the most innovative technologies from around the globe that we believe have the greatest chance of improving the lives of patients.’
In addition, the programme included 49 start-up companies given slots of 10 minutes each to present. As a result over 1,000 breakout partnering meetings were scheduled to facilitate networking between start-ups, strategics, VCs and service providers. ‘This facilitates the overall theme of the meeting which is to help small innovative medical technology companies achieve the finance to bring their technology to market,’ explained David.
Join us at the second annual Medical Alley Innovation Summit in Minneapolis (October 2-3). This global investment and networking event will feature pre-screened start-up medtech companies delivering presentations, thought-leading guest speakers, timely panel sessions – all providing candid insight on topics of utmost importance to stakeholders in the evolving device marketplace.
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