Enabling Technologies: Key Impacts for Stakeholders in 2024
To view our article on the Orthopedic Design & Technology website, click here.
Industry 4.0 is revolutionizing the orthopedic industry. Digitalization has dramatically improved implant manufacturing and supply chain optimization, while better connectivity via the Internet of Things has spawned smart implants, data analytics tools, and enabling technologies that provide continuum of care services to patients undergoing joint replacements. As 2024 begins, the industry’s major stakeholders must re-evaluate their priorities. These players include patients (central figures in healthcare); companies, which are comprised of numerous stakeholders; surgeons, main users of the technologies being marketed (and in development); providers, the main investors of these innovative solutions; and payers, the ultimate adjudicators of reimbursement.
A detailed examination of each major stakeholder in this modern industrial revolution follows.
Patients: The patient is the glue that holds the healthcare industry together. They are the inspiration and driving force behind any new technology or proposed treatment. Patient outcomes are important, but the success of those outcomes depend on patients’ comfort level and confidence in the treatments they receive, regardless of the body part affected (ankles, knees, hips, shoulders, wrist, spine, etc.). Thanks to Dr. Google, patients are extremely cognizant now of orthopedic procedures and devices. While a hospital may be using a “cool” minimally invasive robotic-assisted device to accurately place an artificial joint, that device (or technology) is only beneficial if the patient is comfortable with it and their surgeon is confident using it. Clearly, the patient doesn’t really care whether the surgeon is using a robotic-assisted device, augmented reality, or another kind of enabling software or product. All the patient wants to know and understand is what will happen, why that product is best for treating a particular condition, and of course, the outcome. Some patients anxious about the potential impacts (and dangers) of surgery also may be concerned about the length of a particular procedure or total time under anesthesia.
Companies: The orthopedic industry’s top companies have made significant investments in the 21st century surgical arena. Within these organizations are critical stakeholders that represent the full spectrum of medical care. Patients, however, are the most important stakeholders with companies, as they receive the implants that affect outcomes and, ultimately, companies’ success.
Beyond the patient, however, these companies must find a way to boost surgeons’ confidence with their solutions. Since surgeons’ reputations are at stake with every procedure, orthopedic implant firms would be well advised to ensure practitioners are well-trained and confident they are using the best and most appropriate solution(s) for patients every time they enter the operating room. Consequently, many organizations now spend a significant amount of time contemplating clinical workflow so surgeons can minimize the time spent thinking about technology. This allows surgeons to remain (appropriately) focused on patients.
Innovation is critical to a company’s continued success; as such, employees are key stakeholders and need constant motivation to make a difference in patients’ lives by finding the most effective treatments. Companies can lose critical staff if their ability to innovate is hindered by the pace of decision making, investments in innovation, or other organizational factors.
With economic outcomes increasingly becoming more important than clinical outcomes, providers (customers) of orthopedic technology also are key stakeholders. In value-based care markets, companies must demonstrate customers will benefit economically from their solutions. It’s no longer good enough to simply invent a good system that works. Twenty-first century solutions must provide the best economic and clinical outcomes.
Given these corporations are investor-driven organizations, they ultimately need to provide a return on investment for their shareholders. It’s a lot for these companies to balance but fortunately for all involved, there are some experienced and focused corporations like Stryker, (J&J) DePuy Synthes, Zimmer Biomet, and Smith+Nephew in this game.
Surgeons: Today’s practitioners have an extraordinary opportunity to advance precision medicine simply by leveraging the latest innovations. In implementing enabling technologies such as Zimmer Biomet’s ZBEdge or Stryker’s Q Guidance System into their surgical practice, surgeons can become leaders in creating more individualized and precise patient care. The most successful surgeons will be those who use enabling technologies to perform surgeries and innovative artificial intelligence/machine learning solutions to plan the procedures. Such a strategy can help enhance procedural accuracy, reduce patients’ total OR time, and improve both clinical and economic outcomes.
Provider Systems: Enabling technology customers are under a lot of pressure worldwide. Whether they are a government-backed organization like the National Health Service in the United Kingdom, a value-based care system (i.e., Kaiser in the United States), a “for-profit” U.S. hospital network, or a private entity in the United Kingdom or select European Union countries, these systems receive their revenues from reimbursements. Whether it’s direct from a consumer, a traditional payer (insurance), or a government program (Medicaid), the amount of economic benefit available per procedure continues to dwindle. Those shrinking reimbursement rates can be attributed to the world’s aging population, which is creating an ever-increasing need for health care and overcrowding the confined reimbursement pool. Such an imbalance requires providers to be efficient. Fortunately, some enabling technology developers have proven their solutions provide clinical and economic benefits. As this trend continues, expect providers to increase their use of enabling technologies to enhance their efficiencies, reputations, and outcomes.
Payers: Last, but not least, in the core group of enabling technology stakeholders are payers. As previously mentioned, these payers can be governments or private insurers. Since they have a vested interest in the future of precise, efficient surgery that produces the best economic outcomes, these payers are under pressure to adequately reimburse new technologies without breaking the bank while utilizing innovative solutions that lower healthcare costs. Having observed the implementation of these enabling technologies globally (and their reimbursements), it is clear that some of these technologies are an imperfect science. In fact, for some, enabling technologies in orthopedics may seem to be more of an “art” than actual evidence-based science. However, proponents (like us) claim that some enabling technologies are leading to the inevitable “precision (or personalized) medicine needed for the future of optimized patient care.
In examining the impacts of key stakeholders in the enabling technologies arena, it is clearly evident the orthopedic industry is in the midst of various strategic inflection points that are being driven by the different dynamics of each stakeholder group. Although these dynamics are collectively driving adoption, that acceptance is occurring at varying paces. As the industry moves forward, it will be interesting to observe the opportunities being created to move these innovations from early adoption to the mainstream in order to benefit all orthopedic ecosystem stakeholders.
Florence Joffroy-Black, CM&AA, is a longtime marketing and M&A expert with significant experience in the medical technology industry, including working for multi-national corporations based in the United States, Germany, and Israel. She currently is CEO at MedWorld Advisors and can be reached at florencejblack@medworldadvisors.com.
Dave Sheppard, CM&AA, is a former medical technology Fortune 500 executive and is now focused on M&A as a managing director at MedWorld Advisors. He can be reached at davesheppard@medworldadvisors.com.
To view our article on the Orthopedic Design & Technology website, click here.
