Novel Coronavirus Impact on Medical devices Industry and the Way Forward

The coronavirus COVID-19 has seized the global economy. The major economic players have gone down due to the outbreak. Every industry is being affected. Similarly, the medical devices sector is no exception in this regard. Although the medical device industry had a standing for being more resilient and recession-proof than other industries because in many countries government is looking after the health-care, and it’s not possible for people to skip life-saving medical care even in tough times. But the mainstream U.S. medical devices company stocks have incredibly gone adverse as others over the last three weeks after the novel coronavirus outbreak lead global markets to do so.

Among top U.S companies; twenty companies on Medical Design & Outsourcing reflects seventeen percent decrease in price for both the average and median decline over the last few weeks. Debbie Wang, an expert at Morningstar who analyzes the medical device industry, articulated that experts of the sector were wondering just how drastically healthcare-related stocks are falling.

Low-risk Health-care Procedures to defer due to Outbreak!

If hospital rooms are well occupied with COVID-19 infected patients; the healthcare system needs to focus on managing and administering the coronavirus infected patents first, then the other patients having other health related challenges, to have the intensive care they require in an appropriate way. But, from an extended viewpoint, it’s interpreted that these pending general healthcare procedures are merely deferred until the pandemic is resolved and contained.

Devices for COVID-19

Definitely folks and masses will need some type of medical devices to endure the COVID-19 outbreak, as well.  Manufacturing corporation such as 3M (NYSE: MMM); who manufacture the N95 respiratory mask, the BBC was quoted to having referenced it as “more effective” than a usual mask i.e. surgical or medical mask. But on the other hand; 3M had also seemed with its stock declining around eight percent over the last few weeks. However, it is also possible that with the time, the demand will grow as the market conditions becomes more certain. Moreover a huge number of ventilators will be needed to cope-up the situation, as ventilators serve as life-saving devices for patients under critical situation infected from COVID-19.

The Importance of Supply-chain in the Medical Devices Sector

Still, medical device manufacturers also depend on operative and well functional supply chains, but sadly those supply chains are also undergoing a substantial disruption. During discussions with experts last month, a number of major medical devices companies suffered coronavirus losses in the tens of millions of dollars, and their cautions came before the lethal virus engulfed the entire planet.

Varian Medical Systems articulated that the epidemic in the region of Asia Pacific is suspending software, hardware installations and any installation approvals as healthcare providers focus on handling the outbreak first. The manufacturer of cancer-care products squeezed its 2020 revenue growth forecast to “seven to nine percent” from a preceding “nine to twelve percent”.  Diagnostics and Life Sciences company PerkinElmer cited to have said that it is assessing a substantial decline for demand in China.

Donations to Treat and Cope-up the Virus

While medical device companies see big disruptions to their business activities, they are also looking for ways to contribute medical products and funds to deal with the recent outbreak. As per preceding month i.e. February, members of Trade Group AdvaMed had donated medical products with a value of around 26.8 million USD and also had furnished cash donations with a value of 4.1 million USD to help deal and restrict the virus in China from going to other parts of the world.

Time to Adapt Management Systems for Business Continuity

While reviewing the recent COVID-19 outbreak, and such similar emergencies in future also, it is very unfortunate to see that some medical device companies are not well prepared to respond in such situations where disruptions can actually halt their business processes either due to supply-chains or lack of internal procedures to respond such situations. There are already ISO management systems standards available that can prepare organizations to respond in such unfortunate situations. Management systems that ensure business continuity even in toughest situations that can be foreseen. It is high time for medical device industry to adapt their management systems and integrate business continuity models into that.

Opportunity for Medical Device Players in COVID-19

Although the situation is bit worrisome, there is always a silver lining and an opportunity hidden even in the darkest situations. As part of the U.S. government struggle to lessen the spread of COVID-19 in U.S. communities, the U.S. Department of Health and Human Services (HHS) has reorganized a broad agency announcement (BAA) to emphasize precisely on products to detect, diagnose, avert or cure coronavirus infections.

The broad agency announcement, identified as BAA-18-100-SOL-00003-Amendment 13, was issued by The Biomedical Advanced Research and Development Authority (BARDA) to ask proposals for progressive development and licensure of COVID-19 diagnostics, vaccines, or medicines for example therapeutics or antivirals. BARDA is a part of the HHS Office of the Assistant Secretary for Preparedness and Response (ASPR).

BARDA Director Rick Bright, Ph.D. has said “Amid the expanding global outbreak of COVID-19, Americans need diagnostics, vaccines, and medicines to mitigate the potential impact of this virus”, he further added “To accelerate the availability of these lifesaving tools, BARDA took an important step today to request proposals for development of COVID-19 diagnostics, vaccines, or therapeutics, many of which will be developed using existing platform technologies to permit rapid development.”

BARDA will offer funding along with proficiency and core services to help development projects chosen through this BAA. The products comprise of vaccines, diagnostic tests, therapeutics, and other medications to support, normalize and regularize the immune system, therapeutics aiming lung restoration, medicines that avoid infections either before or after exposure to the virus, ventilators and respirational protective devices. Not only the U.S. almost all the regulatory associations and governmental bodies have announced such initiatives.

There are at present no accepted vaccines, diagnostics or treatments for COVID-19 patients. Medical devices companies can think of their role in the current situation and the opportunity that is present in the market right now. The opportunity is global not only in the U.S. or in Europe.

About the Author

Waqas Imam

S. M. Waqas Imam is associated with TS Quality as a Regional Partner. He is also an ambassador of Medical Device Community. He is an Industrial Engineer by qualification and served the manufacturing industry since 2011. He is also IRCA CQI Lead Auditor of ISO 9001 and other management system standards. He had served as Quality Assurance and Regulatory Affairs Manager in QSA Surgical Pvt. Ltd. and Ultimate Medical Products. He managed requirements of ISO 13485:2003, EU directives, CE marking and FDA. He also served as Expert Blog Writer for 13485Academy and wrote expert articles on various topics of ISO 13485:2016.