February 2015 1010

Innovations in Medical Device Outsourcing

Vasant G Shah

Vasant G Shah
Vice President and Head, Medical Electronics, Tata Elxsi

The rising demand for quality medical products and healthcare services are the primary factor driving the growth of the global medical devices outsourcing market, says Vasant G Shah,Vice President and Head, Medical Electronics, Tata Elxsi

Medical device domain is well known for its ability to adapt to other disciplines of knowledge, which is indeed the reason for its rapid progress. This rapid progress is putting tremendous pressure on Medical Device Manufacturers (MDM). Global demands for innovative and affordable medical products are at the pinnacle now, which is driven in part by an aging population and the needs of emerging market. The challenge for the MDMs is how to seize these business opportunities while complying with more stringent regulatory requirements, surging operational costs and an increasingly complex supply chain.

The rising demand for quality medical products and healthcare services are the primary factor driving the growth of the global medical devices outsourcing market. It is important to realize that outsourcing has moved away from mere cost savings, which was the traditional de facto factor for outsourcing, towards value addition or enabling companies to focus on core functions. Outsourcing is done so that tasks that are laborious, repetitive or less technical in nature can be delegated to external agencies such that quality time can be invested on core areas which will help in maintaining competitive by realizing the benefits of low labor, better quality and improved innovation.

The global medical devices outsourcing market is broadly categorized into the applications and services submarkets. The medical product outsourcing market encompasses Class I, II, and III types of medical devices complying with FDA standards, while the medical services outsourcing market encompasses designing, validation, prototyping, verification, and other regulatory consulting activities. This Medical device domain is well known for its ability to adapt to other disciplines of knowledge, which is indeed the reason for its rapid progress. This rapid progress is putting tremendous pressure on Medical Device Manufacturers (MDM). Global demands for innovative and affordable medical products are at the pinnacle now, which is driven in part by an aging population and the needs of emerging market. The challenge for the MDMs is how to seize these business opportunities while complying with more stringent regulatory requirements, surging operational costs and an increasingly complex supply chain. The rising demand for quality medical products and healthcare services are the primary factor driving the growth of the global medical devices outsourcing market. It is important to realize that outsourcing has moved away from mere cost savings, which was the traditional de facto factor for outsourcing, towards value addition or enabling companies to focus on core functions. Outsourcing is done so that tasks that are laborious, repetitive or less technical in nature can be delegated to external agencies such that quality time can be invested on core areas which will help in maintaining competitive by realizing the US$ 300 billion industry is growing because of the increasing demand of outsourcing across markets. Such demand has fueled innovation in medical technology development and is expected to rise from a value USD 21.1 billion in 2012 to USD 40.8 billion in 2018, registering a CAGR of 11.6 percent in the forecast of 2012 to 2018, according to Persistence Market Research.

Innovations-in-MedicalMedical devices industry has witnessed some of the breakthrough technological advancements delivering efficient treatment with a reduced time to market and cost at the same time. Some of the recent innovations are:

  • Robotic surgery – It has observed tremendous development over the past decade. Nowadays doctors can perform unassisted robotic surgery that has been rated as better than an above-average human surgeon. Robotic surgery is mainly performed for specialized open surgeries for rectifying major organs of the body including heart, brain, kidney, lungs and liver.
  • Micro and nano medical devices – The advent of manufacturing techniques that enable fabrication at the micrometer-scale and below provides unique opportunity for medical device applications. Miniaturization enables enhanced sensitivity, accuracy, and reduced analysis time in diagnostic applications, higher precision, efficacy, and minimized invasiveness in therapeutic applications, and provides the potential for lower costs and broader access to healthcare.
  • Wearable medical devices – It helps in real time tracking of the physical condition of a patient round the clock. Traditional wearable devices helps in tracking sweat, monitoring sleep, counting calories, measuring steps, or charting runs. Advanced waterproof wearable devices also helps tracking glucose levels of diabetic patient needing consistent care while allowing the subject to have a normal life.
  • Microfluidic drug delivery – Traditionally, the use of microfluidic devices has been confined to the laboratory, particularly been employed for drug discovery applications or DNA analysis. However, with the advent of more cost-effective manufacturing techniques, microfluidic devices are being increasingly used as portable diagnostic tools to test blood samples for such electrolytes as sodium and potassium and to create arrays for measuring hematocrit/ hemoglobin, blood gases, coagulation, drug screening, and cardiac markers. Portable microfluidic devices are at the forefront of pointof- care and in-the-field testing applications that allow patients with chronic medical conditions to monitor themselves at home.
  • Neuroengineering – Neural engineering is an inherently new discipline that coalesces engineering, physics and neuroscience for the design and development of brain– computer interface systems, cognitive computers and neural prosthetics. This technology helps in advanced treatment in Braincontrolled spinal interface development and for the advancement of neural interface for assistance and augmentation.
  • Cognitive computing- Cognitive computing marks a new age in transforming healthcare by enabling to produce better trained and skilled doctors and scientists. Cognitive computing is a platform that not only retains and transmits information but actually learns on its own, being inspired by the human brain.
  • Big Data-Big data is also playing a crucial role in transforming healthcare by allowing quick data analysis on huge sets of data generated by daily monitoring of a patient. The ability to use big data to identify waste in the healthcare system can also lower the cost of healthcare across the board.

Focus on Emerging Markets

Emerging market dynamics play a major role in the success of medical device manufacturers. The challenges are different in emerging economies where customers are both extremely price conscious and demanding. In this scenario, a growing number of companies realize that they must reinvent their traditional approaches to product development. Outsourcing is a key factor in designing for the emerging market, which will enable the organizations to focus on their innovative ways while the outsourcing partner can address the needs of the emerging market.

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