Medtech Startup Activity Diverse, Robust, Showing Industry Strengths

The formation of new companies in any industry can be a true litmus of the overall health of the industry and an indicator of the direction the industry is taking through the relative balance of companies with different areas of focus. We present in a bar graph the number of medtech startup companies categorized by the clinical/technology focus of each company (multiple categories possible; e.g., a company can be “surgical” and have a “minimally invasive” focus).

Startups by categories through May 2008

Data is drawn from the MedMarket Diligence “Medtech Startups Database”. Companies are identified as startups based on company registration and categorized by the clinical and/or technology focus of the company. (As a word of explanation, the principal criteria for inclusion of a company in this dataset is the company’s involvement in a market that has medical device involvement, complementary or competitively, and that the company’s founding date can be reliably determined.)

With a central consideration of companies identified and included in the data shown being that companies are either medical device companies or their products (some purely pharmaceutical, for example) are either competiting head-on with device technologies or are complementary to device technologies (e.g., drug-eluting stent hybrids, drug delivery devices, etc.), the most significant areas of company formation are in surgery, cardiovascular therapeutics and orthopedics/musculoskeletal areas of focus. These are, of course, among the most device intensive areas of medicine. See graph below on the number of cardiovascular therapeutics, ortho/musculoskeletal and surgery companies from 2000-2007.

Ortho, Cardio Therapeutics and Surgery Companies 2000-2007

The overall trend is positive for medtech company formations, albeit an apparent peak was reach in 2005/2006, after which formation has slowed somewhat. See graph of total number of medtech company formations from 2000 to 2008.

Total medtech company formations, 2000-2008

Note, please, that the 2008 figure understates the number of company formations since, in our experience, we see a minimum of 2-3 months of “stealth” in the medtech companies during which they are successful generally in keeping the company’s formation under wraps. For this reason, we anticipate over the next few months a surge in 2008 companies identified, including in those founded in the January to May time frame.

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For details on the Medtech Startups Database, go to link.

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2 thoughts on “Medtech Startup Activity Diverse, Robust, Showing Industry Strengths”

  1. Even startups in the health care industry are facing stiffer challenges with the downturn of the economy. A friend of mine in a recent new eye clinic in town has seen a reduction in surgery from his older demographic (His colleagues in the surrounding area are noticing the dip also). His office believes the cause is the elderly waiting for surgery until they are sure of the state of their retirement accounts.

    I wish those who are attempting a startup during this time the best of luck.

  2. Even startups in the health care industry are facing stiffer challenges with the downturn of the economy. A friend of mine in a recent new eye clinic in town has seen a reduction in surgery from his older demographic (His colleagues in the surrounding area are noticing the dip also). His office believes the cause is the elderly waiting for surgery until they are sure of the state of their retirement accounts.

    I wish those who are attempting a startup during this time the best of luck.

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