Tuesday, February 28, 2012

Does Medical Device industry need start-ups to continue the innovation process?


Big companies seek innovation and efficiency to meet the market demands that is always running in a high competitiveness environment, meanwhile the start-ups with good ideas and solutions need to ensure economic survival to bring their products to market.

In a global scenario, and with specific knowledge of the brazilian market, brazilians start-ups gain notoriety not only due to challenges such as risk taking in business, but also by bringing to market the benefits of their innovative ideas. This business model has drawn attention of big companies.

Start-ups do not have the strong, hard and slow structures a big company has. The creative environment and people who can generate new ideas make possible to make mistakes and try again fast and agile.

Typically, start-ups must focus on one idea at a time; however, if that first idea is not as disruptive as first hoped, the end of that idea could also be the end of the company. Those that do survive often form the backbone of larger corporations’next-generation offerings, through acquisition or licensing.

Despite the crucial role that start-ups play in the medical technology industry, the current economic climate cannot be overlooked. Continuing the trend of previous years, in the USA in 2011 we have seen a decline in early stage investment in medical technology start-ups. The investment that has been made has focused on start-ups whose technologies are perceived to have a simpler regulatory pathway to market. The most complex regulatory pathways are often associated with complex technology areas (for example, in vivo imaging and surgical implants) and one could argue that it is these areas that most need disruptive technologies.

For their part, the more progressive medical corporations continue to recognize the importance of these smaller companies (approximately 73% of the United States’ 5300 medical device companies had a head-count of less than 20 in 2007) and many are taking a more collaborative approach to fostering new technologies. Rather than buying an idea outright before significant development has occurred, they are working with start-ups to bring products closer to market through equity or resource investment.

That could be also a great way and opportunity to develop the domestic brazilian medical device industry, that it, working with start-ups to bring products closer to market through equity or resource investment.

To read more about it, please, visit: http://medtechinsider.com/archives/26930

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