I am often asked the question by individuals in the med-tech market, “What is hot?” or “What should I be looking at because I want to get out of the current technology that I am in?”
There are a few, but for today, my answer is………Imaging, Navigation and Robotics. These days those three areas are all so closely aligned.
The recommendation is in part based on my firms more than 130 successful placements in those fields over the past 14 months. That means our firm has spoken to and recruited thousands of individuals in those markets. Individuals from R&D, Marketing, Sales, Clinical, Regulatory, Manufacturing as well as dozens of executives who have been successful in the spaces and also those that have not ended their last venture successfully. Lessons learned and “next time I do it”.
Throw in the much-needed migration of fresh blood and new skill sets from other industries with expertise in software, cloud applications, electronics, firmware, UI/UX have come into the med-tech space bringing it new product perspective and possibilities.
They are bringing a familiarity and experience with very sophisticated integrated systems, open platforms / architectures, machine learning, connectivity, system interfaces, software and UI/UX.
Historically the large capital equipment companies have stayed on the “outside” of the body. The disposable companies have historically stayed on the “inside” of the body.
That is all changing.
There have been some very interesting leadership changes over the past 18 months in the med-tech space. We have been watching “disposables” or “single-use” executives being recruited into leadership roles in the large capital equipment companies.
Capital equipment companies have historically been run quite differently than a disposables company. The large capital equipment companies are typically imaging, navigation and now robotics. To date, their systems have empowered the disposables companies to be able to “see”, “navigate” and “place” the disposable device or implant into the brain, heart, periphery or spine and those markets have been growing rapidly. A striking example of this is the explosive growth of the Structural Heart space. New imaging technologies are allowing the surgeon to work in a space that was previously prohibitive.
The ability for the surgical robotic platforms to develop the sophisticated robotic systems AND the best in class disposables or tools as end effectors for their platforms is a stretch.
New leadership talent in the large imaging companies. The GE’s, Siemens, Toshiba, Philips of the world have brought in catheter, implant, stent and combination products executives to help shepherd the integration of “Outside and Inside” domination. The future growth of these very large publicly traded companies requires them to get deeper into a “razor and razor blade” model to drive meaningful revenue for shareholders. There are only so many software upgrades you can hit a customer up for.
The smart start up money is in the white space: Symbiotic Relationships. Think Apple’s iPhone and its “open architecture” as the platform and how the independent applications developers are the disposables.
Covidien and Johnson & Johnson Ethicon Endo are each developing their own surgical robotic platforms to dramatically enhance their dominant handheld endo/lapro markets and that puts companies like Intuitive Surgical’s existing business in the crosshairs.
The surgical robotics platforms will create tremendous opportunities with the “white space” between the seams. The ability for the surgical robotic platforms to develop the sophisticated robotic systems AND the best in class disposables or tools as end effectors for their platforms is a stretch.
Look for an entire ecosystem to emerge rather quickly in this area of surgical robotic disposable systems that will address access challenges, end effectors, retraction systems, ablation tools, suturing technologies, imaging technologies and more.
This past decade of “PMA Fatigue” has had investors and employees suffer for 5 to 8 year stints while waiting for the design, funding, clinical efforts and eventual acquisition. That sector is exhausted. This emerging market will have a new outlook on 510k products offering an easier approval process and a much lower clinical bar in addition to requiring smaller investments setting up much quicker exits in the $30 to $80 million range and that will make most happier as it will keep deal-turn activity much higher but also require a new perspective on the “startup” market.
As in any growth and change there are going to be friction points. I am personally excited for the med-tech industry. This next frontier will have more opportunity in front of it than ever before.