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Disrupting Healthcare – Constructively: Considerations for Executing Innovation

The healthcare industry is facing significant disruption from new market entrants and technology innovations that have the potential to improve how care is delivered, to lower healthcare costs, and to improve healthcare outcomes. But not all disruption is built to have a sustained and positive impact—how do you tell which innovative technologies and ventures will change healthcare for the better, and which are just noise?

We all hear about disruptive innovation – the power of innovative thinking that sees beyond traditional ways of doing things in favor of new, better methods. When innovators enter the health arena and consider its problems creatively, they seek to break down inefficient aspects that don’t work well for stakeholders and patients. Problems can arise, however, if these innovators simultaneously disrupt processes or protective expectations that serve important functions. Healthcare is a heavily regulated and normative environment—for good reason. Many of its laws and norms function to keep patients safe and clarify roles and responsibilities. This post explores key considerations for new entrants into the healthcare marketplace.

Know Your Audience

To help ensure that disruption is constructive, make sure you understand the needs of your customers and their obligations to their customers and internal stakeholders. Because hospitals, health plans and providers, for example, must operate within a complex regulatory environment, your product or service needs to take those constraints into account. No matter how powerful your technology is, if it shifts regulatory burden onto your customers’ shoulders, it risks being unadoptable.

Data privacy presents a common pitfall for healthcare disruptors in this regard. A new technology might accomplish a task better or faster than traditional methods, but involve data aggregation and sharing pathways that pose steep compliance difficulties. If a healthcare innovation is difficult to implement, it compromises its value. Innovators should carefully evaluate the environment in which their disruptive technology will be deployed, and build measures into its architecture to meet all legal, normative and workflow requirements.

Map Out Your Path to Market

Innovators should also consider what it will take for their product to be ready to bring to market. For technologies that fall under US Food and Drug Administration (FDA) regulatory purview (such as medical devices), that agency will determine when the product has been demonstrated to be safe and effective. But for products not regulated by FDA (such as consumer wearables), market readiness is less clear cut.

In other industries, tech innovations often go through multiple iterations, with subsequent product launches implementing improvements upon the initial model. In healthcare, however, any design deficiencies can have serious safety and effectiveness consequences for the people who rely on your innovation. Even as healthcare innovators seek to disrupt the status quo, they should invest the time and resources necessary to thoroughly test and demonstrate their product’s safety and efficacy.

Finding a balance between agility and thoughtful attention to the realities of the health industry can be an adjustment for new market entrants, but with the right partners and a patient-focused approach, today’s innovators can make sure their disruption changes healthcare for the better.

For a deeper drive into these issues and more, listen the latest episode of McDermott’s Collaborative Transformation podcast.

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© 2021 McDermott Will & EmeryNational Law Review, Volume IX, Number 353
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About this Author

Jennifer S. Geetter, McDermott Will & Emery LLP, Attorney
Partner

Jennifer S. Geetter is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm's Washington, D.C., office.  She focuses her practice on emerging biotechnology and safety issues, advising hospital, industry, insurance and provider clients on matters relating to research, drug and device development, off-label use, personalized medicine, formulary compliance, privacy and security, electronic health records and data strategy initiatives, patient safety, conflicts of interest, scientific review and research misconduct, internal hospital disciplinary proceedings,...

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