Medical Device Daily Executive Editor

SAN FRANCISCO – Greg Caressi oversees a large-sized universe as vice president of Frost & Sullivan 's Healthcare & Life Sciences unit.

So when he was allotted just 30 minutes to give the kickoff presentation at this year's Frost & Sullivan Medical Technologies 2006 Executive MindXchange at the Grand Hyatt Hotel Monday morning, he wisely decided to limit his comments to a more manageable set of topics.

Manageable, that is, if statistics such as $510 billion in costs of chronic disease, 2 million hospital-acquired infections annually and a shortage of 1 million nurses could be considered “manageable.“

Rather than taking a 30,000-foot, airline passenger type of view in addressing “The Future of Medical Technologies,“ Caressi chose to take a look at what he termed three “sleeper“ issues he said are impacting the paths many of the companies in the room might take to grow their businesses.

The issues: Infection control in hospitals, the economic impact of chronic diseases and direct-to-consumer (DTC) advertising by device firms.

One trend with far-reaching consequences today that will become even more so in the future is what he characterized as “the capacity crunch in American hospitals,“ which, coupled with the changing nature of hospital visits and fewer clinicians on hand in those hospitals, is creating huge challenges in infection control.

Caressi said the shrinking number of inpatient beds in U.S. hospitals, coupled with rising inpatient admissions and staff shortages – some of them dictated by budgetary restraints, others due to the well-documented shortage of nurses – is challenging infection control in such facilities as never before, or at least not in modern times.

He said the infection control challenges are enormous. “A lot more people are being cranked through our hospital systems, and there's a smaller number of [caregivers] dealing with this larger number of patients.“

Given the fact that those patients are being sent through the system much more quickly than in the past, with average lengths of stay declining markedly and faster turnover both of inpatient beds and operating room facilities in order to maximize revenue, it should not be a surprise that the number of hospital-acquired infections is at 2 million-plus annually.

Caressi cited a 2003 Journal of the American Medical Association report indicating that patients who get an infection as a result of medical care in hospitals spend almost 10 additional days in the hospital, incur $38,656 in excess charges and have a 4.3% increased risk of dying.

But the infection control problem spells opportunity for providers of both products and services, and not just those specifically directed toward infection control and sterilization. “There is a need to create systems and products to help hospitals deal with this capacity issue,“ Caressi said. “It's about changing the procedures within hospitals – using different devices in different ways.“

Noting that nursing turnover and vacancy rates are highest in critical care units and ORs, “areas where infection control is critical,“ he said technology “can fill the gap created by the labor void.“

He cited such devices as those focused on automating nursing functions, improving wound healing, allowing remote patient monitoring and patient self-care.

As for specific infection control products, Caressi outlined a “Threat Creates Need Creates Opportunity“ scenario in which companies should position their products as “effective means of reducing this financial and capacity burden.“

He said the future is “less about technology and more about clinician/administrator education, protocol development and program implementation.“

Device companies need to focus on products that are “easy and fast to use, that allow for time reduction in hospital processes,“ Caressi said. “Anything that will allow the speed-up of procedures will be in demand.“

In addition to products themselves, he said opportunities abound for consulting services and software that facilitate information gathering on infection control practices and programs for tracking improvement and maintaining compliance with regulatory and accreditation issues.

Caressi's second major market-opportunity trend focused on the growing burden of chronic diseases on the healthcare system.

“In 2000, about one-quarter of all Americans had at least one chronic disease,“ he said. “By 2020, half will have a chronic condition, and more than half of them will have more than one condition.“

Noting that “more people are living with the effects of disease,“ Caressi said acute conditions such as cardiovascular and cancer are declining, but chronic diseases are rising.

It has been estimated that in 2000, the direct costs attributable to chronic disease in the U.S. totaled $510 billion. By 2020, that already-staggering number is anticipated to grow to $1.07 trillion.

Such end users, Caressi said, are looking for a better standard of life. “They've gone from 'How do I solve this problem?' to 'How do I live with this problem?'“

Opportunities abound both domestically and internationally, he said. “If you can create a solution for end users, that will help you market your product not just here, but also abroad.“

Caressi cited Eastern Europe and “underdeveloped“ Asian countries as offering particular opportunities. He said India would become the world's most populous nation by 2035, but that less than 5% of the country now has access to quality healthcare.

His third trend dealt with DTC marketing by medical device companies, thus taking a page from pharma companies.

Noting that less-invasive devices – insulin pumps come to mind – are giving patients “more freedom,“ Caressi said that “baby boomers are making more educated choices.“ Much more well-informed on health matters than at any previous time, they want more information about support services, not just technological solutions.

He cited his own results of a Google search on blood glucose monitoring, saying the search turned up 494,000 sites. A search on hip implants turned up 779,000 sites.

Better-informed, indeed.

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