Partnering for Success: Trends in contract medical device development and manufacturing

The world of healthcare is constantly evolving, and the medical device industry is no exception. 

The 2023 U.S. Medtech Contract Manufacturing Report from Alira Health predicts a promising future for the medical device market, with a projected growth rate of +6.1% in 2023, indicating a steady rise despite the unprecedented obstacles presented by the COVID-19 pandemic.

This report highlights one of the most prominent trends in the medical device industry - the surging popularity of Contract Development and Manufacturing Organizations (CDMOs) as the preferred outsourcing option for medical device companies. It is projected that the use of CDMOs by both startups and large organizations alike will grow by +13.1% in 2023.

The following trends offer exciting prospects for growth and innovation in the medical device industry as it progresses and shapes the future of healthcare.

Medical Device Market Growth and Trends

In 2022, the global medical device market grew by around 4%, reaching $542 billion. According to the report, this progress aligned with long-term trends, as medical care providers largely returned to their normal operating and purchasing patterns following the market fluctuations due to COVID-19.

Growth by medical device segment:

• Invitro Diagnostics (IVD) (8%) - posted the best performance, driven by a surge of lab and testing volumes, as well as a sustained demand for rapid COVID-19 tests.

• Medical Imaging (7.5%) - increased routine screening procedures, with positive contributions from ultrasound and endoscopy devices.

• Drug Delivery (3.5%) - new products accounted for revenue growth in this segment (i.e., smartphone-compatible insulin pumps). 

• Orthopedics (3.5%) - sales benefitted from developing new digital surgery products, robotics-assisted tools, and minimally invasive procedures for knees, hips, and spines.

• “Other devices” -  still saw growth but on the lower end. This includes ophthalmic equipment, urology & gynecology products, and wound care management.

Despite the funding challenges the life science sector faced in 2022, the report forecasts that life sciences VCs will have access to an impressive amount of capital in 2023 and beyond, approaching record levels. This bodes well for both early and late-stage medical device startups, as they will have significant funding available in the coming years to drive growth and momentum through the current recession.

The Benefits of Outsourcing Medical Device Design & Development

Medical device OEMs are increasingly outsourcing their design, development, and prototyping needs to focus on their core business and respond better to changes in demand. 

As we enter 2023, it is predicted that the life sciences industry’s access to capital will hit a record high, leading to more investment in R&D and innovation by medical OEMs. This presents an opportunity for contract design and development companies to support startups and large corporations seeking fresh perspectives, new technologies, and cross-industry expertise.

Picture credit: 2023 U.S.MedTech Contract Manufacturing Report

The diagram above illustrates how contract Design & Development (D&D) services can support multiple stages of a medical device's pre-commercial lifecycle. 

Concept Design

Concept design also allows teams to get feedback from stakeholders through usability testing early in the design process. This can be invaluable in helping to refine the product's design and ensure that it meets the needs and expectations of its intended audience.

Ultimately, by starting with a strong concept design, product development teams can create products that are both functional and aesthetically pleasing while also delivering value to their intended users.

Functional Product Engineering 

The material selection process is an essential aspect of medical device development, as the material used can impact the device's performance, safety, and effectiveness. 

A functional product engineer has the knowledge and expertise to select the appropriate materials based on the device's intended use, regulatory requirements, and manufacturing processes. This can help optimize a medical device's design for manufacturing, improve its overall quality and reliability, and reduce the risk of product failure or recall.

Design for Manufacturability

Design for manufacturability is a critical aspect of product development that contract Design & Development companies can support OEMs with. 
The ultimate goal is to optimize the manufacturing process to improve quality, reduce costs, and shorten lead times. But it starts by designing products with manufacturability in mind. By considering this upfront, medical OEMs can ensure that their products will be produced efficiently and consistently, which is critical in the highly regulated and competitive medical device industry.

Prototyping

Innovating in the medtech space can be a lengthy and unpredictable process, with many factors that can impact timelines and budgets. A prototyping strategy provides medical OEMs the space to test and validate their ideas, designs, and concepts before investing significant resources into full-scale production. 

In this phase, contract Design & Development (D&D) organizations can identify and address design issues and refine product functionality to avoid costly changes and reduce the risk of product failure.

Quality and Regulatory 

Outsourcing can also provide medical OEMs access to specialized expertise that may not be available in-house, such as regulatory compliance, testing and validation, and manufacturing scalability. This can help ensure that medical devices meet all regulatory requirements and are safe and effective for patients.

Moreover, outsourcing can help medical OEMs manage the risks associated with product development, as they can share the risks with their outsourced partners, who have the necessary expertise to manage them effectively. This can reduce the financial risks associated with medical device development and allow medical OEMs to allocate their resources more efficiently.

Product Transfer

The product transfer phase identifies potential problems, ensures the accuracy of product documentation, and facilitates effective communication between the product development team and the production team. This helps to reduce the risk of delays, cost overruns, and quality issues. 

Overall, the product transfer phase is critical to ensuring that the product development process is completed successfully and that the product is launched on time, on budget, and with the desired quality.

MedTech Industry Outlook for 2023 and Beyond

Outsourcing medical device design, development, and prototyping services can bring significant advantages to medical OEMs, including access to specialized expertise and reduced development costs by utilizing the infrastructure, equipment, and personnel of their outsourcing partners.