Rather than focusing solely on funding more complex (and expensive) inventions, medical device companies are increasingly turning to "frugal innovation" for products that can gain ground in emerging markets and developed ones.
Reuters reports on the issue in an interesting analysis of the market trend. Among the largest companies following this strategy: GE Healthcare ($GE) and Siemens ($SI). Both continue to pursue development of extremely complex and pricey diagnostic devices and medical equipment, the story notes. But they're also devoting attention to cheaper medical device inventions with anticipation of huge success in emerging markets seeking cost effective solutions to improve healthcare. GE, for example, is developing handheld mobile ultrasound and electrocardiogram scanners that can be useful in areas without many health clinics.
Medtronic has signed on board, too. As Reuters reminds us, Medtronic ($MDT) CEO Omar Israk has steered the company toward developing low cost implantable devices such as pacemakers for use in Asian, Latin American and African markets. Developing a lower-cost, low-tech device helps expand Medtronic's customer base in emerging markets, but also helps reduce the risk of failure in those areas where high tech might not be so functional, another Medtronic executive explains in the story.
Those simple device solutions can come from unlikely places. Reuters profiles an Argentinean car mechanic in the story who is developing a simple medical tool designed to help a baby get through the birth canal during an obstructed labor.
- read the Reuters story