MedMarket Outlook: High Growth Medical Technologies

(From the September 2007 issue of MedMarkets)

Drawing upon the clinical and technology sectors we have addressed in MedMarkets and the Market and Technology Reports of MedMarket Diligence, we have previously identified a number of areas where we see substantial growth in medical technology markets. In our white paper, High Growth Medical Technologies, we note those areas we consider high growth due to their “likely success in clearing technology hurdles, the size of their respective current/potential caseloads or target markets and their reasonably short (<5 year) timeline to achieve considerable realization in measurable (or even sizeable) commercial terms.” We highlight them here and note additional areas worthwhile to watch.

Nanotech and MEMS. Applications of [tag]nanotech[/tag] in medical/healthcare are incredibly diverse, from device coatings to complex drug delivery, sensors and other diagnostics. Applications are seemingly limited only by imagination: drug delivery, gold nanoshells for heat-killing cancer cells, diagnostics, nanobatteries for artificial retinas, nanosensors for pathogens, etc. [tag]MEMS[/tag] (microelectromechanical systems) applications include implantable pumps, hearing aids, defibrillators, lab-on-a-chip and other biomedical research.

Drug Device Hybrids. Drug-coated stents are only the most obvious. Demarcations between drugs, devices, biotech and biopharm have become almost arbitrary as the products are now more often defined by their functions than their composition, pitting widely different technologies against each other or combining them into products that are far more than the sum of their parts. These include bioresorbables, drug coatings for biocompatibility, [tag]drug delivery[/tag], tissue ingrowth and myriad other possibilities.

Atherosclerotic plaque reversing drugs. Take an established, invasive device market, or markets ([tag]angioplasty[/tag], [tag]stent[/tag]ing, coronary artery bypass technologies. etc.) and penetrate it with a drug — the word “growth” would be inadequate in describing the potential.

Rational therapeutics. Both drugs and device markets, of virtually all types, are at best symptomatic, arguably with high efficacy, but symptomatic nonetheless. Any clinical intervention, however, that directly addresses the root cause of disease or at least moves further upstream in the pathogenic pathway (e.g., insulin for diabetes is a far better clinical solution than dialysis for end stage renal disease), will have substantially more potential. Pharmaceutical development in general, and biotechnology in even more specific terms, recognizes the value in this. However, many a venture capital dollar has been spent overestimating this value while underestimating the technical challenge.

RFID — Radiofrequency Identification. The integration of information technologies with medical devices is inevitable, given the value of information that can be exploited by identification of devices using [tag]RFID[/tag], from ensuring surgical instrument count in the OR, identifying implants in patients, tracking product inventories, etc.

Infection control. The global population and its increasing capacity to migrate brings pathogens from, and to, all corners of the globe. The overuse of antibiotics has stimulated a startling number of drug resistant bacteria. Nosocomial infections represent a huge cost in healthcare systems. These reasons are enough to point to the huge potential for products in infection control.

Obesity Drugs. Effective drugs to treat [tag]obesity[/tag], and preempt all the downstream healthcare complications of obesity, represent potential recognized by a growing number of pharmaceutical companies, even in spite of the recent failure of Accomplia (rimonabant) by Pfizer. High volume caseload with high healthcare costs are strong drivers in support of continued obesity drug development.

To these high growth areas previously identified, we add a number of additional ones, due to the emerging potential seen as high volume potential is matched with achievements in technology development:

Apoptosis. “Programmed cell death” is a normal part of an organism’s life cycle, encompassing necessary functions of cellular differentiation, but also orepresents an area of tremendous study for its potential in areas as diverse as cancer therapeutics and other disease treatments due to the normal or even dysfunctional role it plays in those diseases.

Gene-driven drug development. The mapping of the human genome was a major stumbling block for the development of gene-based medicine, but it is not the only hurdle. The complex interactions of the human genome as it operates in molecular biology, resulting in either healthy or pathogenic tissue systems, are a gargantuan puzzle more complex than the genome mapping goal itself. However, we predict that the progress made in understanding the genetic basis of disease will yield dramatic successes in the development of drugs created based on this knowledge or, in the least, screened against genetic profiles that will dictate the likely success of pharmaceutical candidates.

Neuromodulation. In the September issue of MedMarkets, we highlight some of the developments in [tag]neuromodulation[/tag] and [tag]neurostimulation[/tag]. While applications are diverse, the apparent commercial successes in this field have been limited, but certainly significant to have been noticed (or created) by companies like Medtronic. The human nervous system has an architecture and function that make it innately less amenable to yielding its secrets than are other organ systems, yet advances in implantable devices have converged with the huge unmet need of chronic pain management to create enormous opportunity in the market.

As we have noted previously, the potential markets for advanced medical technologies appear to be limited only by imagination. Manufacturers have demonstrated time and again their ability to create product types, product combinations, applications and all their various customized variations in order to capitalize on the convergence of technical achievement and umet market demand.

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