If you are an investor interested in MedTech, you are likely looking for investment opportunities that will give you the appropriate return on investment, both financially and for the patient. Investments in MedTech companies usually require persistence for a longer period of time, where there is uncertainty about the impact of your investment. Developments of new medical devices are complex, require higher investments than originally budgeted and require the right expertise.
The four step approach to build your proposition
MD squared applies a four-step approach for thoroughly analyzing the situation of a new initiative, resulting in an overview of gaps and risks that support investors in decision making.
MD squared supports Investors to make informed choices. This support often starts with the execution of a QuickExam™, a structured way to look at and evaluate the core of the proposition from different angles. The focus and activities during the QuickExam™ are tailored to the needs and specific questions of the client. A QuickExam™ typically has a 2 to 3 months throughput time, depending on the size and complexity of the new initiative.
Depending on the type of problem or request, the following areas of expertise can be offered:
- Product: product definition, intended use and classification
- Clinical data: Clinical Evaluation, Clinical Data collection and Post-Market Clinical Follow-Up
- Regulatory: Regulatory requirements and applicable standards (MDR/IVDR, FDA and SFDA)
- Quality: Risk based Quality Management System according ISO13485:2016
- Technology Development and Manufacturing: Technical Documentation, Adequate Product Design and Validation
- Market: Addressable market and barriers, Standard of Care and treatment alternatives
- Business Strategy: viability of business case
It is important that all areas line up equally during development of a new company and any gaps are timely identified and filled in. For each segment, the level of maturity is defined, showing the gap in compliance with the requirements and identify the necessary steps to reach the next milestone(s).
Based on the outcome of the QuickExam™ and the needs of the client, MD squared is able to offer Targeted Support. Targeted Support is designed to support and guide the client towards solid investment decisions.
In the first phase of targeted support, content matter experts of MD squared could support the investor in carrying out a due diligence at targeted company. In consultation with the client, a more detailed analysis can be done in the fields of Business Strategy, Markets & Product Proposition, Product Realization, Clinical Data, Regulatory and Quality Maturity. Several scenarios for realistic and ambitious growth can be drawn up, taking an integral view on consequences for the company and business. Providing recommendations on budget to maximize growth potential will be part of the support as well with a realistic timeline in mind. It is all about validating the quality of the business plan to secure its viability.
In the second phase, content matter experts of MD squared could support the client in executing and following through of the business plan. It is all about maximizing value creation till the next investment milestone. Several levels of support could be offered, depending on the type and needs of the venture and investor. Examples of support are:
- Coaching executives and team members
- Accompany executives during key phases to secure and optimise the execution of the business plan
- Reviewing/adjusting processes and infrastructure for scalability
- Development of strategic alliances (national and international)
- Investor representation on the Board of Directors
Key risks to your investment
Technology push vs market pull
Mostly there was no integral approach from the start. Usually, Start-Ups focus on technical development of a product or application first, but clinical development as well as customer and market development are certain stumbling blocks if not taken care off properly right from the start.
Getting regulatory approval
With the introduction of the Medical Device Regulation (MDR) in Europe, it becomes even more challenging for start-ups to meet all requirements for a new product or application, and at the same time maintain your competitive edge and the viability of your business case.
No differentiating product
For entering an existing market with a new product, differentiation is an absolute must. The performance needs to be significantly better than the existing products. Otherwise there is hardly any reason for customers to buy the new product because switching to another product will take time and increase costs.
No sound business case
Business cases usually show steep lines of growth. Question is if the assumptions used to calculate the business case are realistic, taking all dynamics into account. Complexity of products and applictions are increasing and there are many interdependencies that have to be taken into account from the start.
Running out of cash
In many companies, cash projections are too optimistic with hardly any safety buffers. Developments of new medical devices often take much longer than expected and require higher investments than originally budgeted. Attracting additional funding takes a lot of time and effort.