Hot Medtech Startups: 10 Companies to Watch in 2017
Medtech startups face more challenges than they have in the past, but several companies are developing products that take advantage of new technology and are specifically designed to meet healthcare’s evolving needs.
The number of medtech startups has declined. Thirty years ago, the medtech field averaged 1,500 startups; it slid to about 600 by 2012.
This decline makes nurturing startups and entrepreneurship in the medtech field all the more critical. Incubator groups, accelerators and other strategies have popped up in the past few years. Some of those efforts are working to shift the expectations of the medtech industry to meet the changing environment of healthcare.
And it is by no means business as usual. (Check out 10 startups making a difference.)
“It used to be that medical device startups would develop a product by focusing on design, they’d get some IP with the product and it would be gobbled up by a big player,” explained Brett Naglreiter, who has started a consultancy firm to help develop and incubate medical device technologies.
That technology-first model doesn’t work anymore, said Naglreiter. That’s because the risks are higher; the chance of getting a potentially groundbreaking idea to market seems more remote. “You have greater emphasis on manufacturability, reimbursement, how the technology fits in the healthcare environment – all of these things need to be considered much earlier in the process than before, and startups need more breadth of expertise.”
Naglreiter notes that startups might feel pressure to “do it all” up front, something that will scare away those with limited budgets and limited experience. But he said it doesn’t need to be daunting. “You are still going to spend about 80% of resources on your core technology, but you also have to allocate 20% of resources to those other factors. You just have to get a sampling.”
Startups that will succeed will spend significant energy considering the costs of the device, and how the products will make healthcare better. Bryce Rutter, president and founder of Metaphase Design Group, put it like this: “We are past the days when a product does nothing more than feature a new color.”
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