An accurate understanding of the market landscape is the only way to understand where you’re at and where you need to go.
Situation: An implantable technology had experienced strong early double digit revenue growth and was considered to be a promising multi-billion dollar market opportunity. A significant, unexpected and prolonged decline in revenue growth rates had raised serious concerns about the business.
- Approximately 1 million people in the U.S. suffer from this debilitating condition
- Device implant volume of 3,000 per year
- Patients who received the therapy experienced dramatic quality of life improvements
- Primary clinical evidence was a pivotal trial of just 75 pts. supplemented with 5 year data
- Very few implanting physicians due to the high skill requirements, but all were strong advocates with their peers
- Average physician treating indicated patients did not believe in device therapy and did not refer pts. to implanters
What our analysis uncovered:
- Total net indicated prevalence ~ 250k patients; net incidence was ~ 20k/year (~2% CAGR).
- U.S. Annual revenue potential was $600M (initial implants + replacement devices)
- Initial (denovo) implants were actually flat, with revenue growth coming exclusively from replacement procedures
- The opportunity was less than 10% penetrated and adoption had completely stalled
- Awareness with the average physician was nearly universal, but adoption (the referral rate) was near zero
- Good market potential, significantly under-penetrated, but not a multi-billion dollar U.S. opportunity
- Adoption completely stalled with just the early adopters, with no participation from the broader market
- Structural barriers included: weak trigger for device consideration, insufficient evidence, and negative bias of referrers
- Fund large new clinical trial (include broad base of referring physicians)
- Develop more definitive test for identifying indicated patients
- Invest in targeted market development programs to drive adoption with average physicians
- Additional investment was secured against the identified structural barriers, especially clinical evidence
- Denovo implant volume has grown significantly and sustainably
- Seven years later, U.S. penetration was 50%