REGTech Insights: Regulation or strangulation – MedTechs in a tight spot due to medical device regulation?

29. August 2019

Medical technology is one of the growth and showcase industries of the German economy. But there are signs that it may not stay that way: According to a new study [1], the industry is losing momentum and innovation. An excess of regulation could be one reason for this; in particular, the Medical Devices Regulation, which has been in force since 2017, seems to have further exacerbated the situation.

This is because it leads to more complex authorization and testing procedures, sets higher regulatory hurdles overall – and thus burdens companies with further costs and narrower scope for innovation. Stagnating figures for patent registrations and increased activities in the direction of company takeovers and partner searches can be interpreted as indicators that the air is getting thinner for MedTechs, especially for the smaller and younger among them.

“We definitely see that MedTechs are now struggling a lot with regulatory requirements”, confirms Dr. Wolfgang Kraemer, Managing Director of DHC Business Solutions, about the statements on trends made by the study. “This also applies to the area in which we mainly operate, i.e. quality and compliance management”. The increased demand for digital solutions for this makes it clear that new ways are being sought to better implement external requirements and get a grip on complexity.

And the fact that good regulatory intentions can become a problem for innovation is particularly evident in the case of young companies. Not only has the approval of new products now become a tour de force that places great demands on and even over-burdens young companies and startups, but the ‘day-to-day business’ of quality management also provides ample opportunity for distraction from the essentials, i.e. innovations.

“We have reacted to this situation and, with our VENTURES program we have developed a suitable offer for startups and small, young companies”, adds Kraemer. “And the experience with it has been overwhelmingly positive: The fact that startups operate a digital quality management system is definitely appreciated by the Notified Bodies – apart from the fact that it makes life much easier in the day-to-day quality process”..

VENTURES promotes the early establishment of a digital management system for compliance and quality based on DHC VISION. Young companies and startups receive special conditions for a viable and scalable cloud solution with controlled processes such as SOPTRAININGCAPADEVIATIONCOMPLAINT or CHANGE Management.

[1] cf: Jürgen Stüber, Wirtschaftliche Chancen für Medizintechnik-Startups sinken (22.08.2019) (Economic opportunities for medical technology startups fall)