The Future of Healthcare Innovation: Insights from Industry Leaders

The future of healthcare innovation is being shaped by a convergence of new technologies, evolving global medtech market dynamics, and shifting business models. At LSI USA ’24, two of the industry’s most respected leaders — Alex Gorsky, former Chairman and CEO of Johnson & Johnson, and Rick Anderson, Chairman of Revival Healthcare Capital — shared their perspectives on how medtech innovation must evolve to meet the demands of an increasingly complex healthcare landscape.

From the rising cost pressures facing healthcare providers to the need for transformational, rather than incremental, technologies, this discussion highlighted the fundamental changes required to drive meaningful impact in the industry.

“If there was ever a time to be in healthcare — to be thinking about innovation, to be thinking about this nexus of new technologies, and the rigorous clinical regulatory, let alone commercial environment that we work in — now’s the time,” said Alex Gorsky.

The Market Shift: Why Healthcare Needs to Innovate Differently

The medtech industry has long operated under a familiar cycle: startups develop a promising technology, seek venture capital, and ultimately aim for an acquisition by a large strategic player. But that model is becoming increasingly unsustainable.

Rick Anderson emphasized that many traditional approaches to innovation, particularly incremental product development, may struggle to gain traction in the future.

“The market is going to bifurcate into truly transformational, enabling technology that is smart, delivers incredible patient benefit, and has an economic storyline to it,” said Anderson.

For many years, companies have profited from small improvements — whether it was the fifth version of a pedicle screw or minor refinements in surgical instruments. However, as cost pressures mount on healthcare providers, payors, and strategics, the demand for groundbreaking solutions that address workforce shortages, efficiency gaps, and care delivery challenges is rising.

“The days of coming out and saying, ‘Well, my device is 4% different, but I’m going to charge 25% more for it’ — that’s not going to work,” said Gorsky.

This blog is originally published here: https://www.lsiusasummit.com/news/the-future-of-healthcare-innovation-insights-from-industry-leaders