Medtech as a cost driver… or not?

  • Posted on 20.06.2013

Medtech as a cost driver… or not?


Serge Bernasconi

Chief Executive Officer, MedTech Europe

Healthcare expenses

Nowadays everyone seems convinced of the clinical benefits that medical technologies, devices and diagnostics, bring to the table. Many even recognise that our innovations bring about considerable socio-economic benefits. And yet, in the end I hear the same thing over and over again: medical technology drives the rise in healthcare expenditure.

EDMA and Eucomed have always refuted this claim and now we have research by the European Health Technology Institute (EHTI) which basically confirms two of our points of view:

  • There is no systematic link between medtech innovation and rising healthcare expenditure
  • To get a balanced view of whether medtech innovation drives costs, one shouldn’t only look at cost of the technology, but also at the benefits to patients and socio-economic value of technologies

In short, and I say this with 100% conviction, claiming that medtech innovation is the sole driver of rising healthcare expenditure is factually incorrect. There are a multitude of factors which impact costs. For instance, if one of our innovations leads to more conditions becoming treatable, then of course this will impact costs. At the same time, though, there are many examples of technologies whose cost is offset by the savings obtained when a patient can return to work faster, when a technology lowers absenteeism and so on. Hip and knee replacements are a great example of such technologies. Similarly, therapies which increase costs when applied near the end of the treatment pathway are shown to be cost-saving or cost-neutral when carried out earlier in the treatment process. Cardiac Resynchronisation Therapy in patients with heart failure, for instance, can be cost-saving if the device is implanted earlier on in the treatment. At that point, CRT therapy can slow down the disease progression which in turn leads to less hospitalisations, shorter length of stay and so on… all resulting in a cost-saving effect.

Also important to note is that many studies on which the claim of medtech as a cost driver is based consider a wide range of interventions, including novel drugs in areas such as cancer, many of which greatly add to costs, as medical technology. I can ensure you that, if we would not include pharmaceuticals in the equation, medtech’s impact on healthcare cost would provide a more positive view. In fact, if you only look at medical technology as medical devices, in vitro diagnostics and imaging equipment, spending over the last decade has remained stable. Coupled with the socio-economic and patient benefits we offer, our industry is a true partner in Europe’s health, and an important contributor to reaching the goals of the EU Health Strategy which supports the overall Europe 2020 strategy.

From startup to sustainable high-growth business

Europe is a place where great innovations are born. However, we are lagging behind the US when it comes to turning these great theoretical concepts into great actual products. Look at partnerships between universities and the corporate world, and compare the number of these partnerships in Europe with the US. As Rudy Mareel and Aris Constantinides wrote in this blog “Europe continues to lag behind the U.S. when it comes to the entrepreneurial stage of innovation and business development; despite the fact that, in much of Europe, regulatory approval processes for new products are more predictable and often faster  than in America”. That is why the HealthTech Summit, which will be taking place from 25-26 June in London can be interesting if you want to find out more about young companies who will be presenting their technologies to venture capital leaders and other key players from within our industry. And on Wednesday, Guy Lebeau, Chairman of the Eucomed Board, will be holding a keynote speech centred around the upcoming revision of the medical devices directives. Guy will be joined by Antoine Papiernik, managing partner at Sofinnova, one of the largest venture capital firms in Europe. Antoine will talk about the consequences for SMEs from an investor point of view if a pharma-style PMA approval system were to be introduced in Europe. Who knows, maybe we see each other there…

Where I also hope to see many of you, is in our new offices which we just moved into this week! As I already announced previously, we will put together a welcome reception for our members on 18 September, but of course you are welcome to pass by and pay us a visit anytime. We want the new offices to be a modern and “open” meeting point for our members while providing the team with a stimulating and collaborative environment to work in. So come and see for yourself on the 18th, or any time you are in the neighbourhood.

For those of you taking some time off in the next few weeks, enjoy the summer holidays.

All the best,


– Serge Bernasconi, Chief Executive Officer MedTech Europe, EDMA & Eucomed

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