How to Build an Internationalization Strategy for HealthTech

How to Build an Internationalization Strategy for HealthTech

How to Build an Internationalization Strategy for HealthTech

October 13, 2020


Satu Peltonen

Internationalization in a nutshell.

Internationalization Starts with a Strategy

It is a known fact that most internationalization attempts fail due to lack of thorough preparation and adhering to the chosen strategy.

When it comes to life sciences – healthcare technology, biomedical technology and pharmaceuticals – that is an industry operating in a heavily regulated environment, any attempt to seek market growth through internationalization faces a multitude of specific considerations.

In an ideal case, the internationalization has been integrated right into the R&D process, because the target market may encompass cross-cultural and cross-national aspects that need consideration in the design phase.

In most cases, companies opt to localization approach that seems more robust solution but could cause some design alterations afterwards.
Another reason to choose your target market as early on as possible is to implement regulatory requirements into the R&D process by aligning them where applicable.

In other words, it underscores the fact that knowing, understanding and researching the target market is the key-step when expanding to another country.

Once it is clear that the device, application or product fits into the target market, it is time to assess if there is a demand for it and how attractive the market is considering the competition.

Beijing sky scraper & cctv tower

Localization to specific markets is essential in internationalization.

One of the essential aspects when analyzing the potential market is to understand the external environment or business operations and those advantages and disadvantages it has compared to home-market. After all, this is the most substantial deviation of operations so far.

Legislations do Differ

Every country has its laws and regulations that need to be adhered to and preparing for the regulatory requirements is a must and best made with someone who understands the local legislation and human factors process. The need for clinical trials should be taken into consideration when navigating through the regulatory process. The one thing that some companies do not pay enough attention is the IP protection strategy that needs thorough planning with the local legal system in mind.

For reimbursement strategy, it is essential to understand how the healthcare system works. How much is healthcare spending, and what is the role of the government and insurance companies? How much is paid by the government and how much is covered by the insurance? How much is the compulsory insurance and how much is paid out-of-pocket by the patient? Who decides on the treatment? The physicians or the insurance company who pays the bill? In some countries, the reimbursement landscape can be very complicated due to the fragmented healthcare system and medical device distribution, including invoicing.

Business Models and Partnerships

When considering appropriate market entry strategies, adapting the business model to the environment is an iterative process where market fit, distribution and partnerships are some of the factors to consider. Also, what are the required skills and resources needed for successful business operations and is there a need to relocate workers or hire locally in critical positions? Modifying the business model may take considerable time as it involves many managerial questions, including R&D and Know-How against IPR infringements.

“Appropriate partnerships are the key” for successful internationalization, and it will also influence the business model, so taking time to do a thorough research of the key-players will pay back subsequently when creating a supply chain management system. One of the most important aspects of partnerships concerns distributors, with whom discussions also need considerable attention in terms of the trust of business operations. It is worth noting that all of this will influence the import and export operations in terms of manufacturing and financial issues.

Although building an appropriate strategy for internationalization of healthcare technology is dependent on the device, application or product as well as the target market, this outlines those aspects that are essential for building an effective strategy. Even if not all of the above applies to a specific case, they should nevertheless be taken into account when drafting up plans.

The Internationalization Challenge of Medical Technology

The Internationalization Challenge of Medical Technology

The Internationalization Challenge of Medical Technology

July 23, 2020


Satu Peltonen

Beijing sky scraper & cctv tower

Finding appropriate partners is a key-challenge in the internationalization of life sciences and medical technology in a complex endeavour full of challenges and possibilities.

The umbrella term ‘life sciences’ is often used to refer specifically to medical technology, biotechnology and pharmaceuticals.

Life Sciences Among High-Technology Industries

The life science industry distinguishes itself from other high-technology industries with such fundamental dimensions as applying scientific knowledge to provide technological solutions aiming to improve health care and quality of life in a highly regulated environment. At the same time, usually purchasing decisions are not made by end-consumers, but their physicians or such third party as an insurance company, for example.

Early internationalization is facilitated by simultaneous forces both empowering and constraining operations: To recover their investments and to increase turnover, life science companies and medical technology companies, especially, are facing a strong push towards an international outlook with a high technology that has a competitive advantage at an early stage but is not culture-specific.

Forces enabling and constraining internationalization

Bringing largely unchanged medical technology to international markets is typically due to the demand to meet local regulations, but also because the manufacturers assume that users will adapt to new technology through training. However, training is often ineffective when faced with ingrained customs and user expectations in individual countries, which can be seen during the transition phase in the increased use error rate when operating new technology.

Hence, device features should be designed keeping in mind the cross-cultural and cross-national requirements, especially as failure to meet these requirements could easily violate the international risk management (ISO 14971:2019) and usability (IEC 62366-1:2015) standard compliance.

As mentioned, the life science industry is highly regulated, which means that companies need to comply with local demands in their international business activities. Logically, adhering to compliance with a single country’s requirements can result in a design that is likely to induce use errors in another country with different user needs and expectations or use-shaping factors.

Reimbursement strategy is another factor that most companies do not plan early enough when planning internationalization; “who pays for your product?” is a very relevant question as it dictates who will be financing the life science industry across nations. For example, in the Nordics healthcare is mostly funded through social security system (or taxes from the U.S point of view), whereas in the U.S and Germany – example-wise – health insurance is the most preferred financial model.

Nonetheless, there is a strong push to expand from smaller home markets across borders that comes from the need to amortize high research and development (R&D) costs. Even when most companies have limited financial and managerial resources and the key-challenge identified by many life science companies operating in an international healthcare market is to find appropriate partners for ventures. Apart from complying regulatory demands and financing R&D process, organizing clinical trials, including difficulties in getting access to hospitals and doctors, as well as scaling up marketing and sales are among challenges making an international product launch a complex endeavour.

User-Centered Design of Medical Devices

User-Centered Design of Medical Devices

User-Centered Design of Medical Devices

July 9, 2020


Satu Peltonen

Beijing sky scraper & cctv tower

User-centered design of medical devices positions the user and human factors in the heart of the design process to enhance the usability, safety and effectiveness of the medical device, where usability testing is a critical component of the human factors engineering process.

Introducing Human Factors, Usability and Design Thinking

In recent years medical technology has taken a trend towards creating personalized care while seeking ways to enhance quality for patients and to lower healthcare costs. At the same time developers have to keep in mind the ease of use of the devices and gaining regulatory approval for them in the highly internationalized market.

Capturing user profiles and use environments across nations and cultures needs more creative, wide-reaching, and complex problem-solving approaches than conventional preference of scientific and technological advancement.

Even so, it is not uncommon to observe medical technology developers to concentrate rather on engineering than on user needs and usability, although human factors have been identified as particularly important aspect of the risk management plan for medical device safety. 

 So why to put user in the center of medical technology development?

Leaving the fact aside that usability requirements have been addressed by FDA and MDR in regulatory requirements and guidelines to enhance device performance and safety, the most profound reason is to protect people from injury and death due to use errors as they arise from a poorly realized fit between the user and device. One sadly famous example is the programming of infusion pumps, where a simple decimal error of 50 instead of 5.0 – example-wise – could lead to a fatal drug dose delivery. This error has been so frequent that the industry has coined the expression “death-by-decimal point” to initiate use correction processes to address this particular medical error.

To highlight how broad this issue is, it is estimated that thousands of people die due to errors involving medical devices each year. By reviewing FDA’s MAUDE (Manufacturer and User Facility Device Experience) and MDR (Medical Device Reporting) databases it can be seen that several hundred thousand medical devices are being reported on a yearly basis.

To put it simply: From a manufacturers point of view a medical device can be optimized toward safety as long as it remains within the domain of engineering, but once the device has entered the market its safety is dependent on the user. User types and environments of use range widely and even among medical professionals’ differences of sophistication cause a great deal of variety in the user experience, not to mention differences between nations and cultures.

While market for medical technology is getting more and more international it is not enough to consider questions like “who will use this device?” or “what are the expectations of each user group?”, instead questions like “what are the color and symbol code comprehensions?” come into the picture while considering if the design should be universal and free of any special cultural specifics or specially designed for one specific culture.

Such issues and considerations bring a whole new challenge to defining user profiles and use environments, but also emphasizes the need for more user-centered design process. Entering design thinking, which is a human-centered iterative approach for creative and critical problem solving that works well hand in hand with human factors research investigating human characteristics and use environment to translate this into medical device usability and to integrate this into the whole medical device life cycle.

The advantages of design thinking tools are the use of diverse and multidisciplinary teams that tackle to re-define unknown or ill-defined problems by focusing what is most important for the user and their interactions in their real-life environment. The aim is to break the naturally developed patterns of thinking to produce unconventional and original ideas and to bring diverse voices and user-driven criteria into the design process.

As designing for another culture is less intuitive and designers are easily swayed by assumptive thinking in the process it is even more important to seek understanding of the user journey where designers need to break out of their cultural bubbles. It is not about designing for certain languages or traditions, but for different cultural dimension, color and symbol psychology but also for different mental models.