Singular secular Kuznets-like period realized amid industrial transformation in US FDA medical devices: a perspective on growth from 1976 to 2020

ABSTRACT

Introduction

Since inception, the United States (US) Food and Drug Administration (FDA) has kept a robust record of regulated medical devices (MDs). Based on these data, can we gain insight into the innovation dynamics of the industry, including the potential for industrial transformation?.

Areas Covered

Using premarket notifications (PMNs) and approvals (PMAs) data, it is shown that from 1976 to 2020 the total composite (PMN+PMA) metric follows a single secular period: 20.5 years (applications – peak-to-peak: 1992–2012; trough: 2002) and 26.5 years (registrations – peak-to-peak: 1992–2019; trough: 2003), with a peak-to-trough relative percentage difference of 24% and 28%, respectively. Importantly, PMNs and PMAs independently present as an inverse structure.

Expert Opinion

The evidence suggests that MD innovation is driven by a singular secular Kuznets-like cyclic phenomenon (independent of economic crises) derived from a fundamental shift from simple (PMNs) to complex (PMAs) MDs. Portentously, while the COVID-19 crisis may not affect the overriding dynamic, the anticipated yet significant (~25%) MD innovation drop may be potentially attenuated with attentive measures by MD stakeholders. Limitations of this approach and further thoughts complete this perspective.

KEYWORDS:

• Industrial transformation
• medical devices
• economic crisis
• COVID-19
• PMN (510k)
• PMA
• econometrics

Article highlights

• United States (US) Medical Device (MD) innovation may be tracked via novel metrics derived from publicly accessible data collected by the US Food and Drug Administration (FDA). The dynamics of these metrics seem to provide significant insight into innovation features of interest to researchers of the MD industry.

• The evolution of the FDA metrics – Premarket Notifications (PMNs; 510(k)) and Approvals (PMAs) – is individually temporally anticorrelated, suggesting an industrial structural shift in innovative activity (from PMNs to PMAs), due potentially (and speculatively) to more attractive economic rents irrespective of the higher relative regulatory burden.

• Together these metrics show a demonstrable singular secular Kuznets-like periodicity; the cyclicity of which is currently on a downward trend – reflecting a decrease in overall MD innovation – commencing prior to the COVID-19 crisis and anticipated to run for several years.

• All stakeholders involved in the MD development should be aware of such a potential phenomenon and strive to enable policies to buttress MD innovativeness for the sake of patients.

Declaration of interest

The author is an employee of Takeda Pharmaceuticals; however, this work was completed independently of his employment. The views expressed in this article may not represent those of his employer. See Appendix for all data and methods to replicate (test or extend) the results presented herein. To the author’s knowledge, there are no relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript. This includes employment, consultancies, honoraria, stock ownership or options, expert testimony, grants or patents received or pending, or royalties.

Reviewers disclosure

Peer reviewers on this manuscript have no relevant financial relationships or otherwise to disclose.

Notes

1. Note: MDs designated under the De Novo administrative cycle are integrated within PMNs.

2. https://www.fda.gov/medical-devices

3. https://www.fda.gov/medical-devices/device-advice-comprehensive-regulatory-assistance/how-study-and-market-your-device#step2

Additional information

Funding

This paper was not funded.