Download InnAccel - Ecron Acunova

Accelerating Pharma time-to-market, cost effectively
Asia
Europe
Americas
Open Innovation in Medical Devices
(Emerging Market Perspective)
D. A. Prasanna
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
50000
USA
Per capita GDP (2012 $)
8000
4000
BRC
2000
INDIA
1000
2012
Key:
PC: Per Capita
HC: HealthCare
BRC: Brazil, Russia China
Pop:
313 mil
PC GDP:
$51K
PC HC Spend: $8,895
BRC
Pop:
1.7 bill
PC GDP:
$8,221
PC HC Spend: $822
INDIA
Pop:
1.4 bill
PC GDP:
$3,183
PC HC Spend: $223
Pop:
1.7 bill
PC GDP:
$4,375
PC HC Spend: $459
Pop:
1.2 bill
PC GDP:
$1,535
PC HC Spend: $58
2025
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
Medical Devices: US$5.4b, >70% imports
Domestic industry focused on commodities
or low end equipment
Pharma: US$11b, primarily domestic
Strong domestic generic industry;
with strong exports
Hospital
8%
Pharma
3%
Medical Devices
Other
14%
75%
Delivery: US$58 billion,
completely domestic
innovative, low cost service
delivery models
Medicines and doctor’s service have become affordable in emerging market
…MedTech remains unaffordable…
Affordable MedTech- A large economic opportunity
600
Per capita MT Spend
400
USA
USA
MT Spend:
$225 B
PC MT Spend: $643
MT Spend:
$120 B
PC MT Spend: $381
BRC
80
MT Spend:
$156 B
PC MT Spend: $86
40
20
BRC
10
I
2012
MT Spend:
$36 B
PC MT Spend: $21
INDIA
MT Spend:
$42 B
PC MT Spend: $30
Key:
PC: Per Capita
MT: MedTech
MT Spend:
$5.4 B
PC MT Spend: $4.4
2025
Emerging markets are…
Largely self
pay markets
Lack of skilled
professionals
High price
sensitivity
Large
volumes
Inadequate
infrastructure
Low per
capita spends
Large public
health system
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 to
Affordable 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 technology
leading to a new product/solution for a new low-end market
Innovative Affordable Solution Around Product
Godrej & Boyce
Manufacturing,
has developed a
$70 fridge that
runs on
batteries, known
as “the little
cool”
Tata Motors
has produced
a $2,200 car,
the Nano.
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
Developing Product
• What limits user to make
procedure affordable to
patient?
• Productivity?
• Shortage of professionals?
• Associated costs like
consumables?
• Work within Space constraints?
• Service supplies bottleneck?
• 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 low
14hrsX 7days
working
Need Breakdown fix
<4 hrs
Fault diagnosis and
fix takes 24 hours
Built in the product
Diagnostics
Remote access by Engineer
Reaches site with right part
Scanner up <4hrs
More Doctors buy
Innovation in client’s process-
Client Problem
Innovative Solution
CT Scanner cannot
fit in space available
Suite modification
disrupts patient
service affects
income
CT viable @ low
patient fee
If disruption is
reduced
From 9 months
Work flow design for lower
space
Installation days at site
minimized
Medical facility redesign &
construction service
Changing the way our customers work
Customer Delight
To Customers
We Are In The Business
To Help Hospitals
Become #1
In Their Business !
Innovation at clinic
Market Performance
Customer
Improvement
Clinical Performance
Waiting Time Reduction &
Operations Performance
Building affordable Product around Client viability
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
Innovation with Digital Health
“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?
60%
India
Global
1000
Asia Pacific
40%
Europe
500
North America
20%
Latin America
0%
MENA
0
Social Media
Cloud
Mobile
2013
2017
SMAC (Social, Media, Cloud, Mobile) have emerged as powerful forces driving businesses
yet medical device companies can embrace these trends to create a differentiation
Owning the Disease – A New Business Model…
…where companies deliver solutions across the care continuum
using open innovation
Constant patient engagement to communicate insights
Preventative
health and
wellness
Diagnostics
Therapies
Posttreatment
processes
Chronic
disease
management
Data and analytics leading to key insights from across areas
A new paradigm that makes healthcare affordable for self pay markets
Questions?
[email protected]