Ryan Murphy, a life sciences advisor with Enterprise Ireland, describes how Medtech companies in Europe can address the US market’s reimbursement challenge.
The US market often proves alluring for Medtech companies in Europe. Worth an estimated $155bn (€136bn) annually, the US alone accounts for about 43% of the global medical device market.
Reimbursement is a big challenge that faces European Medtech companies with plans to export to the US. Getting authorisation from the Food and Drugs Administration (FDA) can be a slow process. While most first-time Medtech developers are aware of what is required to achieve regulatory authorisation, some underestimate the extent of what is required to get reimbursement approval from health insurers.
Earlier this year, Enterprise Ireland, the national export agency, co-ordinated a client workshop across US, German and French offices to share guidance on how European Medtech companies can overcome the reimbursement challenge.
Most workshop attendees agreed that the FDA is fair and transparent about the steps required to navigate the regulatory process. Reimbursement by health insurers can be less straightforward. The US has a complicated reimbursement system, involving multiple coding systems for using a device, and hundreds of payers with varying incentives and coverage decisions.
When targeting the US market, European Medtech companies are advised to do their homework early. With sufficient planning, a single clinical study can supply all of the data required for both regulatory authorisation and reimbursement approval, saving the time and costs involved in conducting multiple studies. Even small design modifications implemented later can affect a product’s regulatory classification, the establishment of a predicate device, or your ability to use an existing reimbursement code.
An upfront analysis of realistic timelines and price points can deliver a vital indicator of whether your product or solution is ever likely to achieve timely approval and worthwhile profit margins in the US.
European companies should take advantage of pre-submission meetings with the FDA to establish a good relationship, ensure proper classification, and develop well-designed submissions and studies.
Medtech developers also need to engage with stakeholders early in the process. Even if your new device is amazing, if it doesn’t fit a physician’s workflow, it will not be used. Equally, if a solution doesn’t address a significant pain point for payers, it won’t be reimbursed.
Finally, it’s important to know when to ask for professional help. Getting a complex device to market often requires assistance from a seasoned consultant.
Priorities in the Medtech industry are constantly changing. European companies should be aware of the evolving concerns of providers, payers and, increasingly, patients. US health system managers, for example, are now actively looking for value-based care solutions.
The European Union’s market authorisation system is perceived as easier and faster as it simply requires qualifying for the CE mark. There are, however signals that the EU may soon move closer to the FDA model and this may impact on the tendency for European medtech developers to target European markets before the US.
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A version of this article originally appeared in the Sunday Independent