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Why does one medical technology company acquire another medical device or information technology company? Does this business decision reflect solely a desire to enhance the company’s balance sheet and eliminate competition, or is there something special in healthcare which mandates becoming both a vertically and horizontally integrated company that offers the healthcare consumer better value for money, i.e., better diagnostic and therapeutic outcomes?
While recognizing that all businesses consider themselves to be special, the Global Medical Forum Foundation has argued that healthcare is perhaps the most unique business for a number of reasons that go beyond the overarching moral and ethical mandates of caring for the sick – which are already sufficient in themselves.
Nothing that a participant in the healthcare drama does in the private sector can avoid the scrutiny of society and its chosen regulators. But that is the least of the reasons for a company to seek to expand or absorb other healthcare businesses.
Healthcare has a very special language and a confusing set of customers. So it makes sense for a healthcare company to acquire and sustain an extremely knowledgeable, sympathetic, and trusted staff that can talk the talk and relate to consumers, whoever they might be. More importantly, at both the scientific and technical levels, the interface between diagnostics and therapeutics is becoming progressively blurred, as molecular imaging and predictive medicine proceed apace. Thus, the fully integrated medical technology company can understand and address these issues and look for the most beneficial ways to apply new creative insights and innovative technologies. It can then make the required intellectual and practical leaps to connect seemingly disparate observations. Furthermore, it is axiomatic that the more tools that an individual or an organization possesses, the faster the rate of change and innovation.
The caveat that must be remembered is that the structure of a megacorporation may in itself stifle innovation. That is a leadership and vision issue which should be soluble.
The issues to be raised in this plenary session are by no means trivial,
for advances in medical technology have profoundly influenced for the
good the practice of medicine and represent the culmination of numerous
scientific and technological innovations, many of which can only take
place in the environment of a powerful and affluent organization. But
which direction will convergence take us: towards the slow behemoths
of other industries or the brilliance of discovery?
Since the introduction of the U.S. law regarding Health Savings Accounts (HSA) in January 2004, more than 3 million Americans have signed up for HSA type plans. Proponents expect that number to rise to over 10 million in the near future. Employers and individuals can invest pretax money in the accounts; the money can later be spent by the consumer on health related services.
Unlike many European systems - including France, Germany and Switzerland that have co-payment systems, the U.S. consumer has been subject to a third party healthcare payment system paid for by employers or the government, often up to the first dollar. The expectation is now that Consumer Driven Healthcare will greatly enhance the efficiency of the U.S. Healthcare system and fundamentally alter payer, provider and patient relationships. Those critical of CDHC warn about favorable risk selection, or ineffectiveness regarding the 15% of individuals that cause 75% of the healthcare cost.
At the first European Summit of the Global Medical
Forum Foundation in Berlin in February senior European
and American healthcare leaders discussed the
relevance of the U.S.experience with CDHC to design
principles for EU healthcare systems embracing both
solidarity and consumer choice. There emerged a consensus
that the tools developed in the U.S. to enable
CDHC are applicable to EU systems.
Round Table 2 will present the main takeaways from the second annual GMF Summit in Washington DC: «What is the Truth About the Cost and Utilization of Medical Technology in Europe vs. the U.S.?» One hundred political, medical technology, insurance, and regulatory leaders were brought together to discuss this important subject and to learn from European and American experts what facts underlie this crucial debate. The premise of the Washington Summits is to establish meaningful dialogue among knowledgeable and experienced participants in order to stop the involved parties from replicating the mistakes of others.
This approach has proved extremely useful and rewarding.
At the first Washington Summit in December
2003 the subject was: «Is the United States Subsidizing
the Global Pharmaceutical Market: A European
Perspective?» While the answer to this question may
seem self-evident, the supporting facts clarified for the
audience the thinking of US national decision makers,
including the then Commissioner of the Food and Drug
Administration.
This Round Table presents very practically the field that has led in the past decade to a drastic refashioning of the way healthcare is practiced; namely information technology – a pure example of the connection between invention and social need and of the reason why the moment of invention is so often identified with the moment in which it comes into use, unfairly forgetting all the previous trials, tribulations and expenses of the inventors and society as a whole.
In order for a medical IT system to flourish, there must be the technical and social infrastructure to support it. Furthermore, in medicine, serendipity may occasionally play a part. More often, fundamental changes are brought about by individual genius, increasing technical sophistication, patient demand, and economic stimuli. Round Table 3 is also designed to fulfill one of the important goals of the Global Medical Forum Foundation: to alert healthcare regulators and payers of new directions in healthcare technology and the rationale for their introduction into clinical practice. |
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 Plenary Session
How will convergence in the medical
technology industry improve healthcare?
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Round Table 1: Conclusions from Europe Summit I:
Consumer driven healthcare:
Turning patients into consumers?
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| Round Table 2:
Conclusions from US Summit II:
The cost & utilization of medical
technology in Europe vs. the U.S.
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Round Table 3: Presentations of cutting edge new medical technologies & devices
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GMF | 2.0
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