Medtech Innovation: U.S. Leads, with Emerging Markets Gaining Ground
BY LAUREN UZDIENSKI, JANUARY 18, 2011
This morning PwC released a report on the status of healthcare innovation worldwide, with the U.S. earning the top ranking, followed by Germany, the U.K., France and Japan. Catching up are China, Brazil and India, with the authors predicting that China will reach parity with the developed European nations by 2020.
The report identifies a number of challenges the U.S.'s leadership in medical innovation, particularly pertaining to China. The U.S. has historically been the largest healthcare market, but it is expected to grow at a slower rate than China or India, whose markets are predicted to increase by 15% and 23%, respectively, over the next decade. The report states that this could incentivize multinational devicemakers to focus on emerging markets and domestic manufacturers in these emerging markets to launch products in their own countries before or even without seeking U.S. regulatory approval. China is also focusing on validating their science, with the report noting that the country publishes more research papers than any country other than the U.S. and that the quality of China's research institutions is improving.
The report also suggests that the U.S. may suffer from the "innovator's dilemma"; that is, prior successes in innovation have "created a legacy" that the current system will protect, making it difficult for disruptive technologies to enter the market. As far as existing regulatory processes, the EU takes about half the time as the U.S. to approve a product for the market; Brazil and India take longer than the U.S., and China is longer still, at about a year. PwC predicts that the EU will continue to offer the most regulatory support for its innovators, with emerging markets improving but not reaching European levels. As far as reimbursement, the U.S. is among the easiest countries to achieve reimbursement, with China as one of the most difficult, but companies surveyed by PwC said they expected the U.S. to get more difficult and China to become easier in the coming years. Financial support for innovation is also expected to increase in China, Brazil and India, fueled by both domestic and overseas investment, while domestic U.S. investment slows.
AdvaMed released a statement on the PwC report, commenting that the report could be interpreted as a call to action to "hit the reset button on American policy toward innovation." The lobby said they would continue to work with the FDA and other policymakers "achieve the goal of making sure the U.S. medical technology industry remains the world’s leader in the development of new technologies for patients."
