From the March 2017 issue of HealthCare Business News magazine

A stronger and more diversified funding pool
Ultimately, without funding, a startup’s technology will not reach market. A key reason for the consistent decline in launching new startups is the lack of financial backing. The AdvaMed report notes that VC investment in the industry has gone from about 13 percent of total VC dollars in the early 1990s, to about 4 percent in recent years.

Of particular concern, the proportion of those funds devoted to early-stage startups — which often are dependent on these funds to survive — has decreased to a mere 3 percent in recent years from about 10 percent in the early 1990s. Why are VCs fleeing medtech innovation? Often it’s because of the inherent risks and the length of time it takes to achieve a return on investment. That’s why the industry must identify alternate sources of funding, whether through government programs, private grants and investments or partnerships.
It is incumbent upon all of us to assume a role in advancing innovation in medical technology. The ability to better manage and ultimately eradicate cardiovascular disease depends on entrepreneurial minds dedicated to helping discover creative solutions that effectively address the needs of patients today and in the future. At the Fogarty Institute, we abide by Dr. Thomas Fogarty’s philosophy that, “There has to be a better way.” While progress is constantly being made, let’s continue to work together as an industry to find better ways to advance medtech innovation.

About the author: Andrew Cleeland is CEO of the Fogarty Institute for Innovation (www. fogartyinstitute.org), a nonprofit medical technology incubator.

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