How the World's Aging Population is Impacting the Medical Device Industry
People are living longer. Moreover, the elderly population is remaining healthy into their golden years thanks in part to the innovations being made in the medical device industry. According to the U.S. Department of Health and Human Services, the "60 years or over" population segment in developed countries is expected to increase from 23 percent to 32 percent by 2050. In fact, the senior segment has already surpassed its youngest cohort, "15 years and younger."
As the aging developed world population continues to grow, so does the demand for medical devices. While this is certainly good news for the medical device industry, there are some caveats. Because a large part of medical device spending will come from government-subsidized healthcare, profit margins will be lower. To succeed in this higher volume, lower margin environment, leading medical device organizations must streamline their internal processes, including their quality management system (QMS), to continue to reduce costs and increase efficiency.
How Emerging Markets are Impacting the Medical Device Industry
New markets, such as China, Mexico, and Brazil, are providing the medical device industry with consistent revenue growth. China's plan to extend healthcare to every Chinese citizen by 2020 is expected to create huge opportunities for foreign medical device companies; spending is projected to grow from $357 billion in 2011 to $1 trillion in 2020. While competition is beginning to trickle in from local medical device manufactures, at present, consumer confidence in China lies with western brands, for which they are willing to pay top dollar. Although this is music to device manufacturers' ears, long-term success is by no means assured.
To successfully tap into the burgeoning medical device market in China, as well as in other developing countries, international device manufacturers must be willing to rethink their current business models and distribution strategies, which may be barriers to entry. The biggest stumbling block for many device companies is their lack of local regulatory knowledge. Learning how to navigate the varying rules and regulations in these emerging countries is a challenging process, but one that is critical to establishing local operations and attracting government tenders.
How Increased Regulation is Impacting the Medical Device Industry
Regulatory oversight of the medical device industry is at an all-time high; particularly in the areas of design and supplier control. Consumers, as well as industry stakeholders, are demanding better, safer products, and regulators are being compelled to act on their demands.
The Patient Protection and Affordable Care Act (ACA) of 2010, which included a $20 billion dollar tax on the medical device industry, signaled a shift in the U.S. government's focus from the "more is better" philosophy of healthcare toward one that emphasizes a higher quality of care.
The FDA's 510(k) submissions process, the most widely used approval path for medical devices, has also come under scrutiny. Consumer advocacy groups argue that the policy is outdated, and has failed to keep dangerous and/or ineffective devices off the market. In response, the FDA has proposed 510(k) policy changes that will require device manufacturers to provide more evidence of product safety.
Recent UDI (unique device identification) legislation further illustrates the FDA's focus on product safety. UDI compliance will require medical device manufacturers to establish an identification system for each device. The UDI system is intended to improve the quality of information in medical device adverse events reports, which in turn will help the FDA identify product issues faster, increase supply chain security and efficiency, better target recalls, and improve patient safety. The FDA intends to phase in the UDI system over the next seven years. Implementing the UDI system will be a major undertaking for medical device manufacturers.
How Healthcare Consolidation is Impacting the Medical Device Industry
The staggering number of hospital mergers and acquisitions that have occurred over the last few years has transformed the way physicians and hospitals deliver patient care. Independent hospitals are being acquired by large healthcare systems in record numbers, and the shift toward larger healthcare delivery systems is expected to continue to evolve, particularly if economies of scale can be gained.
To survive this transition, medical device manufacturers will need to better illustrate the clinical value of their devices by investing in robust quality reporting tools that tie their products to measurable health outcomes.
How MasterControl Can Help the Medical Device Industry
Hundreds of medical device companies throughout the world use MasterControl quality and compliance software to satisfy compliance requirements, standards, and directives from the world's leading regulatory agencies including the FDA (21 CFR parts 820 and 11) and ISO 13485.
An end-to-end solution, MasterControl provides an effective framework for a company's QMS by automating and connecting all system processes (everything from design control to audit), and providing a web-based, centralized repository for all documentation. The solution suite can help device manufactures improve operational efficiency, agility, and achieve continuous compliance.
In addition to automation, MasterControl offers medical device companies two key advantages:
- Mobile Access: MasterControl allows users to access important compliance-centric documents and information and perform tasks using a tablet or a smartphone. Mobile access offers greater flexibility for users and helps boost overall efficiency and productivity.
- Cloud-Based Services: For companies that want to avoid the cost-prohibitive upfront investment typically associated with purchasing an on-premise QMS system, MasterControl offers private cloud-based services. MasterControl's cloud-based QMS offers the same robust system in a secure environment without the need for large IT staff. Companies can deploy faster, a benefit that can improve compliance and deliver a much faster and higher ROI.
MasterControl offers the following modules:
MasterControl Documents: For many manufactures of medical device and diagnostic equipment, the MasterControl Documents module typically serves as the foundation for building a robust enterprise QMS. It allows users to track, search, retrieve, route, review, and approve documents electronically, increasing efficiency while simultaneously reducing the possibility of human error and lost documentation. Because the module has been designed to consolidate document control with other quality system management processes, such as design control, audit management, CAPA, risk management, supplier management, and bill of materials (BOM) management, it provides the enhanced visibility medical device managers need to react and adapt to the latest business and industry trends.
MasterControl Training: Medical device manufacturers use the MasterControl Training module to automate the distribution and monitoring of training tasks. Because enhanced regulatory oversight is expected to continue to increase throughout the medical device industry in the coming years (the UDI rule being just one example), implementing a robust training module is critical to ensuring that all employees are properly trained on the latest standards and regulations.
MasterControl CAPA: Medical device manufacturers need to maintain control of their CAPA processes to avoid regulatory penalties. MasterControl CAPA is a closed-loop, easy to use solution that streamlines the management of quality events from root-cause investigation through implementation of preventive action.
MasterControl Audit: Medical device manufacturers use audits to prove their processes and procedures are in compliance with SOPs and regulatory standards, mitigate risks, manage suppliers, and increase organizational transparency. The MasterControl Audit module is robust enough to handle all of these tasks. It offers robust reporting tools and the capability to connect the audit management process with other critical quality processes.
MasterControl Risk: In the medical device industry, risk management has become an integral part of the design, development, and production processes. Risk management is applicable to all types of medical device equipment, and evidence of its application is required by most regulatory bodies. The MasterControl Risk module provides a single platform for all risk-centric activities and documentation to help drive an organization's compliance goals.
MasterControl Supplier: This "one-stop shopping" solution integrates supplier management with the quality management system and provides a single repository for all supplier quality data and documentation. It allows users to create scorecards for the effective evaluation of suppliers. It also provides robust tools for tracking and trending supplier quality events such as deviations and SCARs.
MasterControl BOM: The bill of materials (BOM) has always been critical to a medical device company's overall success, but never more so than now. As outsourcing and expansion into emerging markets continue to increase the number of suppliers involved in the manufacturing of a particular device, the margin for error also increases. MasterControl BOMs "where-used" feature displays exactly where a part is used across multiple BOMs, permitting users to determine the impact of a single part change and updating subsequent changes where needed.
For more information about MasterControl
To learn more about MasterControl, contact a MasterControl representative.