Open Innovation in Medical Devices (Emerging Market Perspective) D. A. Prasanna
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Open Innovation in Medical Devices (Emerging Market Perspective) D. A. Prasanna Accelerating Pharma time-to-market, cost effectively Asia Europe Americas
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Open Innovation in Medical Devices (Emerging Market Perspective) D. A. Prasanna. Accelerating Pharma time-to-market, cost effectively. Europe. Americas. Asia. Sharing experience in Open Innovation. This talk is based on my experience in the MedTech industry - PowerPoint PPT Presentation
Transcript of Open Innovation in Medical Devices (Emerging Market Perspective) D. A. Prasanna
Open Innovation in Medical Devices (Emerging Market Perspective)D. A. Prasanna
Accelerating Pharma time-to-market, cost effectively
Asia Europe Americas
Sharing experience in Open Innovation
This talk is based on my experience in the MedTech industry growing GE 100 fold in a decade in India through innovation as a Strategic Advisor to InnAccel, a MedTech Accelerator and In Ecron Acunova CRO bringing new devices to market faster
Emerging Markets are attractive but need Affordable MedTech
Affordability makes care accessible, expands market
INDIA
BRC
USA
BRC
INDIA
1000
4000
2000
8000
2012 2025
Per c
apita
GDP
(201
2 $)
50000
Pop: 1.7 billPC GDP: $8,221PC HC Spend: $822
Pop: 1.4 billPC GDP: $3,183PC HC Spend: $223
Pop: 1.7 billPC GDP: $4,375PC HC Spend: $459
Pop: 1.2 billPC GDP: $1,535PC HC Spend: $58
Pop: 313 milPC GDP: $51KPC HC Spend: $8,895
Key:PC: Per Capita
HC: HealthCareBRC: Brazil, Russia China
Per Capita HC Spend estimated at 7% of GDP and 10% of GDP for India and BRC respectively in 2025
Affordability is largely unmet in medical technology
75%
14%
8%3%
Hospital
Pharma
Medical Devices
Other
Delivery: US$58 billion, com-pletely domestic innovative, low cost service delivery models
Pharma: US$11b, primarily do-mesticStrong domestic generic industry; with strong exports
Medical Devices: US$5.4b, >70% importsDomestic industry focused on commodities or low end equipment
Medicines and doctor’s service have become affordable in emerging market…MedTech remains unaffordable…
Affordable MedTech- A large economic opportunity
I
USA
BRC
USA
BRC
INDIA
10
40
20
80
400
2012 2025
Per c
apita
MT
Spen
d
600
MT Spend: $120 BPC MT Spend: $381
MT Spend: $5.4 BPC MT Spend: $4.4
MT Spend: $42 BPC MT Spend: $30
MT Spend: $156 BPC MT Spend: $86
MT Spend: $36 BPC MT Spend: $21
MT Spend: $225 BPC MT Spend: $643
Key:PC: Per CapitaMT: MedTech
Emerging markets are…
Largely self pay markets
High price sensitivity Large volumes Low per
capita spendsLarge public
health system
Lack of skilled professionals
Inadequate infrastructure
Alternate care environments(~50% of babies in India are
born at home today, necessitating new products for neonatal care - until they can
get to a hospital)
...fundamentally different for MedTech Innovators
Open innovation is “the use of purposive inflows and outflows of knowledge
to accelerate internal innovation and expand the markets………..”
- Henry Chesbrough
Helps move mind-set beyond device cost & features toAffordable procedure for the Patient/Doctor
Viable investment for the Hospital….
Leading to a totally different Product…or Process solution!
Market Specific Affordable Products Solutions
Transportation – Auto-Rickshaw• Affordable• Road Conditions (congested roads)• Appropriateness (often used by 1-2 pax only)
Diagnostics – Portable Ultrasound• Defeatured version of Japanese design• Clinical excellence at an affordable price • Increased access via portability
Look outside for ideas and integrate them with internal technologyleading to a new product/solution for a new low-end market
Innovative Affordable Solution Around Product
Tata Motors has produced a $2,200 car, the Nano.
Godrej & Boyce Manufacturing, has developed a $70 fridge that runs on batteries, known as “the little cool”
Innovative affordable solutions around ‘Process’
Aravind Eye Hospitals have reduced eye surgery costs by over 80% by applying standardization principles from McDonalds
Narayana Hrudayalaya has made open heart surgery affordable (one tenth the cost in western countries!) while maintaining the same standards of reliability
3nethra is a screening device for 5 leading causes of preventable blindness and an algorithm to automatically screen patients; available at one sixth of equivalent devices in the market
Exploit the frugal innovation culture to design and launch new products
Innovation- in Client’s Process & our Product
Outcome in Client’s Process•What limits user to make procedure affordable to patient?•Productivity?•Shortage of professionals?•Associated costs like consumables?•Work within Space constraints?•Service supplies bottleneck?
Developing Product
•Product meets right need of market?•Technology reducing cost?•Manufacturing ?•New Product ‘speed to market’•Optimal regulatory pathway?
Affordable solution needs open innovation
Defining Market Specific Unmet Need
If I had asked my customers what they wanted, they would have said a faster horse.- Henry Ford II
Clinical observations through immersion
• observing not just a specific clinical situation but the entire cycle of care
• identifying the problem inherent in that situation / environment• reshaping one’s understanding of the problem into a need
Innovation in client’s process-
Client Problem Innovative Solution
Patient fee/scan low14hrsX 7days
workingNeed Breakdown fix
<4 hrsFault diagnosis and fix takes 24 hours
Built in the product DiagnosticsRemote access by EngineerReaches site with right partScanner up <4hrsMore Doctors buy
Innovation in client’s process-
Client Problem Innovative Solution
CT Scanner cannot fit in space available
Suite modification disrupts patient service affects
incomeCT viable @ low
patient feeIf disruption is
reducedFrom 9 months
Work flow design for lower spaceInstallation days at site minimizedMedical facility redesign & construction service
Disruption reduced to 1 month
Changing the way our customers work
To Customers
We Are In The BusinessTo Help Hospitals
Become #1 In Their Business !
Customer Delight
Innovation at clinic
Customer Improvement
Market Performance
Waiting Time Reduction & Operations Performance Clinical Performance
Client Problem Innovative Solution
Cost/scan high due to
consumables
Consumables like CT Tubes and Ultrasound probes ECG leads from
France, USA, Japan
Innovative business model with a defence electronic firm in India to
produce at 1/4th the cost
Building affordable products around client Grew GE 100X in a
decade
Building affordable Product around Client viability
Innovation with Digital Health
SMAC (Social, Media, Cloud, Mobile) have emerged as powerful forces driving businesses yet medical device companies can embrace these trends to create a differentiation
“Is Apple going to eat medical device companies' lunch?”“Could Digital Health Make Most Medical Devices Obsolete?”
What can incumbent medical device companies do to protect themselves against the onslaught of Google, Apple, IBM’s foray into MedTech?
Social Media
Cloud Mobile-20%
0%
20%
40%
60%IndiaGlobal
2013 20170
500
1000
Asia PacificEuropeNorth AmericaLatin AmericaMENA
Owning the Disease – A New Business Model…
Preventative health and wellness
Diagnostics TherapiesPost-
treatment processes
Chronic disease
management
Data and analytics leading to key insights from across areas
Constant patient engagement to communicate insights
A new paradigm that makes healthcare affordable for self pay markets
…where companies deliver solutions across the care continuum using open innovation
