Special considerations for the commercialization of medical devices compared to biologics.
For most investigators and entrepreneurs it's likely that your work is naturally more engineering oriented and suited to a device or implant or alternatively, more oriented towards a pharmaceutical approach. Nonetheless, it can be helpful to see some of the contrasts and to set some expectations even though each startup experience is unique in many ways.
For investors, there are often trends where investing in certain areas becomes hot or cold. In recent years, medical devices has become a hot area again. There are a few distinctive characteristics of medical devices worth noting.
It depends on how invasive and how novel the device is, but on average the FDA approval path tends to be shorter for devices than for pharmaceuticals. It is quite short if there is a "predicate device" (a similar device already on the market) as the Premarket Notification (510k) path is abbreviated. If the device or the mechanism used is very novel, then you may need to take the longer Premarket Approval (PMA) path. An experienced regulatory consultant should be sought out. Some information is available on the FDA website providing advice for those with devices.
In comparison to biotech startups, medical device startups typically require raising less capital. This is because the clinical trials are often smaller, the timelines are shorter, and you can start getting revenues from sales of the product sooner.
However, there are also downsides. Since patent protection is not as airtight in devices, you often start to see serious competitors much more quickly and so there is more pressure to continue innovating. Also, reimbursement issues can be complicated between insurance companies and offering physicians incentives to switch their modes of practicing.
On the other hand, startups developing new pharmaceuticals tend to be riskier, but provide much higher returns to investors and entrepreneurs.
In comparison with medical devices or software startups, biotech startups require much higher amounts of fundraising and more rounds of fundraising.
More information can be found on the US FDA website. New pharmaceutical compounds can take 10 years to make it through the FDA approval process (and on the order of only 1 out of ten makes it). As an investigator, your involvement may wane over the years, leaving you free to pursue other projects. However, you should be prepared for the long time it will take.
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