Medical Device Development (PH210)

Benchmarking US Early-Stage Product Management and Promotion
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Published 2015
120 Pages
400+ Metrics
95 Charts and Diagrams

Acquire Competitive Resources for Device Development and Commercialization

As medical device manufacturers face increasing competition in a saturated market, companies must begin commercialization early in the product lifecycle.

However, it is a challenge for teams to acquire the appropriate personnel and financial resources — either internally or elsewhere — to adequately support emerging medical devices throughout development.

This report serves as a guide to medical device manufacturers that are undertaking new product planning and early commercialization initiatives for US-based launches. Because each product is different, the study profiles 11 devices, including product support and investments, unique approaches to product development and commercialization, and the human and financial resources needed to support these processes.

From identifying best-fit regulatory pathways to selecting partnerships and acquisitions for optimal product commercialization, Medical Device Development also presents key strategies for maximum product success.

Medical device executives working in a variety of functions, including product management, marketing, strategic management, R&D, new product planning, business development will get the following benefits from this report:

  • Profiles of 11 medical device manufacturers and their products, including resources for development and commercialization; competition levels; and product technology.
  • Data on expected commercial success, including market size versus peak annual sales, market share and competition levels in the US market.
  • Metrics detailing device product novelty (innovation level) — breakthrough, adjacent, and line extension — as well as the origins of underlying device technologies.
  • Benchmarks for commercial board staffing across four major product development stages, broken down by device class, company/company size, function and eight key therapeutic areas.
  • Benchmarks showing commercial board investments and expenditures per development phase and device class.
  • Strategic guidelines and expert advice on correctly choosing a product’s regulatory pathway, forging partnerships or making acquisitions to support development, and compiling health economics data for product value stories.
  • A case study on the best-fit regulatory pathway for a diagnostic, highlighting use of Clinical Laboratory Improvement Amendments (CLIA).

 

Key Questions That This Study Answers

  1. What key factors influence medical device commercial investments? How much time and money should be allocated for Class 2 and Class 3 products at each development stage?
  2. Why is it important to establish a commercial board and a dedicated marketing group early in development?
  3. How many people should a commercial board have, and what functions should be involved on these boards?
  4. What kind of competition can a product expect based on novelty, class or therapeutic area?
  5. Why might it be advantageous to run clinical trials even if they are not required for approval?
  6. How do partnerships and acquisitions expand company/product support and commercialization capabilities?
  7. How can medical device executives best prepare for a payer’s demands for health economics data and proof of product value?

 

Top Reasons to Read This Report

Leverage clinical trials to supplement FDA submissions and to enhance marketing messages: Although the FDA only requires clinical trials to support Pre-Market Approval (PMA) submissions, both PMA and pre-510(k) submissions can benefit from clinical data by earning more extensive claims than those submissions without clinical trials. Clinical trials may also satisfy anticipated questions from the FDA, thereby expediting regulatory clearance. This report includes medical device companies’ strategies for successful early commercialization for products launching in the US market, including the percentage of companies using specific regulatory pathways.

Manage commercial board size and responsibility to limit delays and keep communication open: Resourcing commercial boards appropriately, both in terms of adequate numbers as well as the right mix of functions, is crucial for product success. It is necessary to have several groups providing input and sharing information while maintaining the appropriate lines of communication. This report examines commercial board staffing and spending in detail. It also includes data on how different functions can most effectively contribute their expertise and experience to commercial teams.

Look to partnerships and acquisitions to maximize resources during product development and commercialization: Because medical device development and commercialization consume a lot of resources, many device manufacturers look to partnerships and acquisitions to aid a number of processes. Medical device companies can use acquisitions to gain businesses, intellectual property and technology, or any combination thereof. Medical Device Development features data that highlight the prevalence of partnerships and acquisitions for surveyed companies supporting Class 2 and Class 3 products.

Medical Device Benchmarking Metrics

Chapter 1: Profiling Successful Medical Device Commercialization Efforts and Resources

Major Takeaways

  • Prepare for varying levels of competition based on product novelty, particularly for adjacent brands.
  • Drive product development through new technology and access to external platforms.

Chapter Data
52 charts and profiles detail medical device companies’ early commercialization and product development resources and expectations for the US market. Throughout the chapter, data are broken down by product novelty (breakthrough product, adjacent products and line extension), company size (top 10, top 50 and small) and device class (2 and 3).

Device Competition Levels and Market Share

  • Percentage of companies marketing products (breakthrough products, adjacent products or line extension products), by novelty and company size
  • Expected commercial competition, by product type
  • Total market size versus peak annual sales for Class 2 and Class 3 devices (top 10, top
    50, small companies)
  • Expected US market share (by company size and competition level)
  • Sources of specific underlying technologies (by device classification and company size)

Device Manufacturer & Product Profiles
This section showcases profiles of 11 medical device manufacturers and their products. Each profile contains the following elements:

  • Product background and level of competition: Data show key pieces of background
    information, including:

    • Therapeutic area and focus
    • Device class
    • Product novelty (breakthrough product, adjacent product, or line extension)
    • Anticipated market size
    • Expected peak annual sales
    • Market share during peak annual sales
    • Commercial competition at launch
  • Product technology and development: Data show the number of months dedicated to four key stages of product development:
    • Concept and prototype development
    • Development and final design
    • Clinical studies
    • Approval and manufacturing ramp-up
  • Data also highlight underlying product technology, including:
    • Internal versus external product technology usage
    • Development via in-house efforts v. collaboration or acquisitions
    • Type of acquisition (technology, business or intellectual property) where applicable
  • Development and commercialization spending
    • Early commercialization spending by development phase
    • Cumulative marketing investment from concept through product launch
    • Distribution of total commercial investments across multiple activities
  • Commercialization staffing
    • Phase during which commercial teams are assembled
    • Number of FTEs from specific departments serving on commercialization teams or committees by phase

 

Chapter 2: Organizing Commercial Staff and Spending During Product Development

Major Takeaways

  • Benchmark commercial board staffing and commercial investments per development phase.
  • Establish marketing groups early in development to maximize commercial output.
  • Leverage cross-functional commercial boards to provide strategic planning, as well as aiding product approval/clearance and reimbursement.
  • Consider product complexity (e.g., device class) and expected market size when planning for commercial investments.

Chapter Data
35 charts detail commercial board staffing and commercial investments for medical devices launching in the US market. Throughout the chapter, data are broken down by product novelty (breakthrough product, adjacent products and line extension), company size (top 10, top 50 and small) and device class (2 and 3).

Commercial Board Staffing

  • Commercial board staffing for Class 3 and Class 2 devices — both total staffing and by function — during:
    • Concept and prototype development
    • Development and final design
    • Clinical studies
    • Market approval and manufacturing ramp-up
  • Average number of FTEs serving on commercial boards throughout product development, by function, for Class 2 and Class 3 devices
  • Development phase during which dedicated marketing groups were created, by company size and device classification

Commercial Investments and Expenditures

  • Duration of development phases for Class 2 and Class 3 devices
  • Average commercial investment during the following stages,
    by phase duration:

    • Concept and prototype development
    • Development and final design
    • Clinical studies
    • Approval and manufacturing ramp-up
  • Average total commercial investment, by total duration
  • Total commercial investment for top 10, top 50, and small device companies
  • Total commercial expenditures per phase for Class 2 and Class 3 devices
  • Total commercial Investment for Class 2 and Class 3 devices

 

Chapter 3: Development and Commercialization Strategies for Product Launch Success

Major Takeaways

  • Look to 510(k) clearance to support Class 2 devices and pre-market approval for Class 3 Products.
  • Use clinical trials to support FDA submissions — even 510(k)s — and enhance commercial messages.
  • Clearly assess company needs — personnel, budgets or capabilities — to select best-fit partners.

Chapter Data
6 charts detail medical device companies’ strategies and tactics for successful early commercialization for their products launching in the US market. Throughout the chapter, data are broken down by product novelty (breakthrough product, adjacent products and line extension), company size (top 10, top 50 and small) and device class (2 and 3).

  • Percentage of companies using specific regulatory pathways
  • Percentage of products developed organically versus acquisitions and collaboration
  • Breakdown of medical device acquisitions

Sample Content from Medical Device Development

The following excerpt is from Chapter 2, “Organizing Commercial Staff and Spending During Product Development.”

Keeping commercial teams involved during product development is a key component of a product’s success on the market. Commercial boards should include several groups within the company, such as marketing, R&D, clinical and manufacturing. Involvement from these various groups allows companies to balance each group’s requirements while maintaining a forward-looking approach to product development. These commercial boards can also influence investment in developing medical devices, and each individual group is responsible for controlling those costs.

Staffing commercial boards appropriately, both in terms of adequate numbers as well as the right mix of functions, is crucial for a product’s success. The following data discuss how these boards are staffed overall. They also show how different groups can effectively contribute their expertise and experience at the right time. Despite the higher regulatory burden associated with Class 3 devices, most companies report higher staffing levels for Class 2 devices. Higher staff levels are a result of the larger patient populations that most Class 2 devices serve over Class 3 devices.

STAFF COMMERCIAL BOARDS BASED ON PHASE-SPECIFIC WORKLOADS
Figures in the report show the total staffing levels for commercial boards as well as how surveyed companies staff those commercial boards with different functions. Key points include:

  • During early concept and prototype development, commercial board staffing for Class 2 devices ranges from 2 to 11 FTEs. Class 3 devices have as many as 20 FTEs on their commercial boards during this phase.
  • Among 14 surveyed companies with Class 2 devices, 8 have more than 10 FTEs on their commercial boards during prototype development (Figure 2.2).
  • Class 3 and Class 2 device commercial boards are, on average, dominated by the two manufacturing groups (direct labor and engineering) and technical functions.