The minimally invasive surgery market, and associated Danish ...

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10
The minimally invasive surgery market,
and associated Danish opportunities
globalization would not be playing first violin in the symphony that depicts the future of the surgical
industry.
As it is not the demographic situation of the 1960’s, which prevails today, we will instead see Chinese
low-cost versions of the surgical devices used today, flood the “Old World”. This will happen for the
following reasons:
1) Expiring patents
2) EU approval process & IP prosecution
3) Demographics
4.2.1 Expiring patents:
First of all, many surgical devices in the duopoly-like environments described earlier, are based on
patents that have expired or will soon expire. This fact alone should justify our relative harsh
introductory comments on the innovation level in the surgical device industry. This is, however, not the
point – the point is that the combination of expiring patents and globalization most likely will spearhead
the influx of “copy & paste” devices from China over the next decade.
4.2.2 EU approval process & IP prosecution:
Secondly the ease of approval for surgical devices in the EU, relatively to the US, will further assist the
influx of Chinese “copy & paste” devices.
The ability of European nations to follow through an effective IP prosecution towards Chinese “copy &
paste” device manufactures who might not be eager to “sit-it-out” for 20 years is questionable, and that
for two reasons. One being that though the EU represents a significant geographic area and economic
power; it is comprised of 27 independent nations whose individual determination to push for change in
China is questionable. Even as a collective (European Union) the maneuverability seems subject to
many conflicting interests and agendas, and though on paper more powerful than the individual nations
in the end probably also challenged in carrying through change in China.
4.2.3 Demographics:
Finally, the demographic reality bites again - as it is the above factors in combination with the
demographic situation in Europe that will leave politicians and hospital executives with the dilemma of
acting against the low-cost “copy & paste” Chinese manufactures, thus, protecting big business' (often
US based) IP - or accepting the much needed extended hand that the “copy & paste” solutions offer in
the battle against exploding healthcare costs. The authors of this brief are betting on the latter.
4.2.4 What will globalization look like?:
We believe that with globalization entering on the surgical device market at full force over the next
decade or so we will see many of today's technologies that are non-novel, yet, still “alive and kicking”
and attached with labels as: “highly innovative, premium devices, preferred by surgeons, best in-class
outcomes” etc., become commodities.
How that exactly will unfold is not easy to predict, yet, our estimate is that premium priced devices like
DES (drug eluted stents) for interventional cardiology, stapling devices for laparoscopic surgery,
mobility implants (knee, hip, spine) and many more will become low priced technologies developed,
produced and marketed from China or another low cost production region.