In the March 15 issue of Medical Device Daily, there were two stories that discussed the medical technology industry in the U.S., and neither of them cast a particularly flattering light on the current state of affairs. In fact, it appears that this once proud and successful domestic industry is on life support.

Perhaps the most credible criticism came from Tom Fogarty, a legendary entrepreneur in the medical device field. In a story written by Senior Staff Writer Amanda Pedersen, Fogarty asserted that “it’s reached a point in the field of medicine that we in the U.S. are no longer the leaders in medical technology.”

He noted that U.S. physicians go overseas to learn from physicians in other countries who have more experience with the latest technologies because they’ve had earlier access. “That is an upsetting situation, not just for our economy, but for our patients. It’s horrible.”

A story about a panel at the Southeastern Medical Device Association (Norcross, Georgia) annual meeting written by Staff Writer Omar Ford, noted that more companies are going to Europe and overseas to launch their products.

“One of the things we look for is predictability,” Robert Crutchfield, a partner at Harbert Venture Partners, said during the panel at SEMDA. “I think that’s one of the challenges with the U.S. market today. From my perspective, we don’t mind complexity as long as there is some predictability around the complexity, so you can jump through the hoops. So I think that Europe still has sort of a predictable process.”

Another panel member noted that thanks to the cultural change at FDA investing in medical device technology in the U.S. does not hold the appeal it did in the past.  “We think there are a lot of positive things about the medical device space primarily to bio-tech or pharma,” panelist Robert Morff partner with Hatteras Venture Partners, said. He noted that while it is still easier to get a product though clinical trials in the U.S., That’s “less true than it was a number of years ago and one of the issues in particular was that the medical device approval pathways are getting longer and they’re requiring more clinical studies.”

Several issues have helped to create this perfect storm for the U.S. med-tech industry. There is a great uncertainty in the FDA process and very little clarity on current healthcare reform efforts. Additionally, the industry will have to deal with the 2.5% Medical Device excise tax which is scheduled to begin in January 2013.

So what should be done to get the U.S. back on the right track to reclaiming its leadership position in medical technology? Fogarty said it will have to start with a cultural change on all sides – industry, FDA, CMS, and physicians.

“I think it’s reached a point that regulators and industry have become severe and fierce combatants,” he said. “We have to understand that we should be not competitive, but compatible. We must respect one another and once you establish that, then I think we can move forward.”

What do you think, is a lot of this talk just doom and gloom on the part of industry, or is there real trouble brewing for the medical technology industry in the U.S.?