How to optimise time and cost-to-market in product development
The medical device industry is changing – with a shift towards a more complex product design with integrated solutions, challenging approval processes, shorter exclusivity periods and the request for innovative and compliant devices. At the same time, new players such as data giant Google are entering this market, increasing the pressure in the medical device industry. This is coupled with the need to build and manage collaborative partnerships, rising development and product costs, and longer time-to-market for new products.
We surveyed 40 senior executives and representatives from medical device developers across Europe and the US to assess the critical success factors in developing innovative and compliant products quicker and more cheaply. The respondents came from organisations that produce Class I to Class III medical devices.
As our results show, organisations greatly underestimate the performance of their top competitors. And yet they don’t seek to outperform them – just match them – which is a cause for concern.
Looking at the top five competitive drivers for the medical device industry in the next five years, reducing time- and cost-to-market have already been recognised as being essential.
Time-to-market – only beaten to the top spot by product innovation – is followed by efficient product development, product cost reduction and integrated solutions (for further information follow the links to PA´s key value propositions).
Organisations are targeting an average reduction of 25% in the next five years for development time and costs to remain competitive. For time, this indicates a reduction of between three and 15 months in the next five years, so the effort to accelerate time-to-market must start now.
The general cascading of development costs for the different medical device classes ranges between less than $3 million to more than $20 million. With the stated average cost reduction of 25%, savings between $1 million and $5 million can be achieved.
The reuse of technology is seen as the best way to avoid unnecessary development time and cost.
This can be addressed by:
Companies recognise that focusing on core competencies and managing suppliers is key for time and cost reduction. However, responses indicate organisations have not yet achieved an optimum mix between outsourcing and in-house activities. Value Analysis/Value Engineering, design-to-cost and integrating systems early on are not rated among the top five levers – however, we expect these activities to play a more important role in the future.
If you are keen to learn more about how you can reduce time- and cost-to-market in the medical device industry, we can benchmark your current capabilities and future strategies against those of your competitors. Using data gained from the results of our research and industry best practices, our medical device experts will guide you through our short benchmarking tool to discuss necessary steps targeting the specific challenges of your company.
Get your copy of "Gaining Competitive Advantage in Medical Devices" to help you optimise time and cost-to-market in product development.
What are your thoughts?
