Shifts in investment strategies and the policies that threaten the lifeblood of medical device innovation
What we learned during an open dialogue with J&J Innovation, MassDevice, GCMI & T3 Labs on the current state of medtech innovation in the Southeast.
An open dialogue focused on where we are as a medical device community is necessary for growth. It is crucial to recognize pain points, celebrate wins and identify new opportunities on a regular basis to foster growth in the Southeast medtech ecosystem. In an effort to create this open dialogue in advance of our flagship conference in April, Jason Rupp, Executive Director of SEMDA, sat with three industry experts to dive into the state of the Southeastern medtech and medical device innovation community.
Ibraheem Badejo, Sr. Director of New Ventures at Johnson & Johnson Innovation Center, Brian Johnson, Co-founder & Publisher of MassDevice, and Tiffany Wilson, CEO of Global Center for Medical Innovation (GCMI) & T3 Labs talked through the effects of the recent shifts in healthcare policy, why investment numbers just aren’t what they used to be, and the resources that are available to small or medium medtech companies here in the Southeast.
Here are a few highlights from the information packed 30 minute webinar.
Jason- Where do you see the Southeast now in terms of medical device innovation?
“Innovation in the SE has always been here but now we are seeing more of an emphasis from Universities and health systems on organizing efforts around innovation that has not been done before; with a true focus on commercialization. Innovation does not address an unmet clinical need unless the commercialization piece is figured out. Unless an innovation turns into a product that someone is going to buy then it’s just not going to work. In the Southeast we are really starting to see that come together.
“I think one thing that is missing that places like Boston and San Francisco have is a broader workforce and larger company base. Historically it has been a challenge to find strong executive leadership here in the Southeast. However we are now at the point where we are seeing that change.”
Jason- Let’s take a moment to talk about policy. The repeal of the ACA was pulled last week, but uncertainty still remains. I am wondering how policy is affecting the mood of the ecosystem- especially in regards to the medical device tax.
“I definitely still think the medical device tax will be repealed permanently especially if medical device companies, both large and small, can demonstrate in a meaningful way that those dollars are expanding the innovation ecosystem by increasing manufacturing in the U.S., and hiring U.S. workers. Then we will have data and justification to take to our legislatures for a permanent repeal.”
“The patients are our north star. We are always asking, ‘What value are we bring to the patients?’ We are working together with global leaders to shape the future of healthcare- and for medical devices that means shaping the future of surgery for patients as well as payers.”
“Given the political climate it seems inevitable that the medical device tax will indeed be repealed. So there doesn’t need to be a whole lot of concern about that. What we really need to be worried about is some of the policies coming out of the White House- like $6 billion in proposed cuts to the NIH, anti-trade policies, and strict immigration policies which can limit the amount of talent we have coming to America. I think these are all numbers the medical device community should be worried about. The medical device tax is going to be repealed but what good is a 2.3% roll back on that if we are killing the funding that helps start medical companies.
“The NIH small business research innovation grants are literally the lifeblood of this industry. The industry should be concentrating all of it’s fire power on attacking those cuts rather than sitting around talking about the medical device tax. That will be gone by 2018.”
Jason- Investment numbers were catastrophic in 2016 as opposed to 2015. What do we do to change that?
“Investment isn’t going to stop. We are looking to invest in companies who have found a highly valuable solution to an unmet clinical need- and it is going to be a long haul. With the regulatory guidelines that are in place, these are not short term investments that we are making. The days of an investment and quick exit are gone.”
You can watch the webinar in full below.
The value in attending SEMDA 2017
“In the SE there are so many pockets that are very different from one another,” says WIlson. “You have Nashville, Raleigh, Birmingham, Memphis, Tampa, Gainesville, Atlanta. SEMDA is an organization that is demonstrating the ability to connect all of those dots.”
“SEMDA serves as the central connecting hub for the Southeast medtech community. We have met new companies at SEMDA that are now MMA clients. Through our involvement with SEMDA, we have been able to connect our clients with investors, suppliers, and specialists to help their business succeed.” –Courtney Warren, consultant for the Marsh & McLennan Agency
Access the entirety of the Southeast medtech ecosystem during SEMDA 2017, April 26 & 27 in Atlanta. Register today.