Medizinprodukteindustrie

2008-06: The German MedTech Industry in the year 2008: New alliances for medical progress and quality

Article for Medical Devices Technology
June 2008, by Joachim M. Schmitt & Manfred Beeres, BVMed - German Medical Technology Association

Dealing with medical technology advances is one of the most important formative issues in the healthcare market. It most especially concerns the medical technology companies as part of a dynamic and highly innovative industry. German medical technology manufacturers achieve a good third of their business volume with products which are less than three years old. The researching companies in the Medtech sector invest an average of about nine percent of their sales revenues in research and development.

For BVMed and medical technology companies, it remains a great challenge to convince decision makers with the help of studies and clear lines of arguments that innovations in the healthcare market should not only be debated with respect to cost aspects. We want to work towards having not only the usually higher initial costs of a new procedure considered in isolation, but rather to get the entire costs of a treatment case assessed and evaluated. To do so, we need an improved data basis on the use of medical technologies under "everyday conditions" in clinical practice as well as the doctor's office. 

We try to solicit new alliances for quality and medical advances in the healthcare market. We need better cooperation between policymakers, health insurance funds, hospitals, physicians and industry in order to ensure high quality Medtech care for people and to see that innovations and medical progress reach the patients fast.

The BVMed exerts itself on behalf of joint projects between companies in the Medtech sector and the health insurance funds and physicians in order to develop and stipulate criteria for a genuine quality competition. The common objective on behalf of the patient must be to counteract the trend towards cheap medicine. A positive example is the set of quality standards governing the supply of technical aids. We also need more projects in hospital care to make quality measurable.

The German Medtech Market 2008

Healthcare spending in the medical devices sector (without capital goods) in Germany amounted to more than 22 billion euros. Of this amount, about 11,5 billion euros account for medical technical aids, 9.5 billion euros for other medical supplies and about 1 billion euros for the sector of medical dressings, which is listed in the category “pharmaceuticals". The share of Statutory Health Insurance in the total expenditure amounted to some 14 billion euros.

The medical technology industry employs 95,000 people in about 1,200 companies (with more than 20 employees per company). In addition, there are roughly 10,000 small businesses working in the sector with about 75,000 employees. The core industry thus employs some 170,000 people in Germany in more than 11,000 companies.

The total business volume of manufacturing medical technology companies increased in Germany by 8.1 percent to 15.9 billion euros in 2006. The domestic sales volume rose by 3.2 percent to 5.7 billion euros, the export sales by 11.1 percent to 10.2 billion euros. In export, Germany, with a world trade share of 14.6 percent, ranked second worldwide behind the USA (30.9 percent) but distinctly ahead of Japan (5.5 percent).

Good Domestic Conditions for the Medtech Sector: What Needs to be Done?

How can Germany's leading market position in medical technology be preserved and expanded in the long-term? How can general conditions be shaped to promote the Medtech industry? The BVMed summarizes its appeal to policy-makers and the self-governing bodies in five different subject areas:

:: We need a closer relationship between the political spheres of economy, research, finance and health in order to coordinate the cooperation of all responsible ministries for the health economy more effectively, especially on behalf of studies and support programs.

:: We need to think more strongly in terms of processes in the health economy. We must consider an entire case, not isolated product costs. We are disturbed that innovations are often only discussed with regard to cost considerations. That point of view is too short-term. It is misleading to look at the usually higher initial costs of a new method in isolation. Therefore we have to work with the hospitals and users to develop instruments for determining the benefits and costs over the full length of a particular treatment or disease. The faster adoption of innovations also usually offers economic advantages as well by leading to a reduction of sick days, shortening patients’ recovery times and thus enabling people to return to their social activities and their jobs more quickly.

:: For the innovation capability of hospitals and the Medtech sector, it is important to preserve the principle of "permission with the reservation of prohibition". Many innovations are initially applied in hospitals. Medical technological innovations in hospitals are subject to reimbursement by Statutory Health Insurance, unless there has been a negative decision of the Joint Federal Committee (JFC – Gemeinsamer Bundesausschuss). This principle must be adhered to in the inpatient sector, so that innovative medical technologies can be made available to all patients who require them without delay. The subject of promoting innovation also includes our revising and simplifying the so-called innovation clause for hospitals to introduce new Medtech sector procedures.

:: An accelerated introduction of innovations is of great importance. For this we need more flexible reimbursement schemes. These include flexible co-payment schemes or the permission to self-insure.  If we open up the system here, then the health insurance funds will compete for the rapid introduction of innovations in the future. This range of topics also includes simple process measures, such as those customary in industry. We must define unambiguous contact persons, procedures, deadlines and evaluation procedures for processes like the assessment of procedures or the revision of the DRG catalog. With clear definitions, we have a chance of accelerating the processes as a whole.

:: A particularly sensitive sector is the supply of technical aids. Here the healthcare reform has brought about a fundamental change in the supply structures. In the future, those entitled to care must be contract partners of the health insurance funds, which will usually be determined by competitive bidding. Legal clarification is urgently required to establish that health insurance funds are public contract parties and that the invitations to tender constitute public orders. Invitations to tender are not the adequate means for supplying technical aids which require customized manufacture or adjustment or which involve a high portion of service; another solution is needed for providing optimized, high-quality care of extremely sick persons who cannot do for themselves, or chronically ill patients.

The upshot of these five subject areas:

If we promote innovations and proceed in a more coordinated manner, while taking greater consideration of quality aspects, then the Medtech companies will remain a growth engine of the health economy for the benefit of patients in the future.


Contact:

BVMed -German Medical Technology Association
Reinhardtstr. 29 b, D -10117 Berlin
Internet: http://www.bvmed.de 

 


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