Two Mature Technologies in Flat Markets

It’s never too late to invest in quantifying the market landscape.

Situation: A large medical technology company with two successful, well-established implantable therapies had experienced years of very low procedure growth rates. There was no consensus regarding which (if either) technology had  untapped growth potential and if so, how much. Consequently both businesses suffered from lack of focus and missed opportunities to financially optimize their performances. Management was now deciding to try invest more in therapy #1, believing therapy #2 was truly tapped out.


Background:

  • Both therapies enjoy dominant market share
  • Both therapies have been available for well over 20 years
  • Both therapies had years of flat sale

What our analysis uncovered:

  • Therapy #1 had reached >80% of its US annual revenue potential and about 50% of its OUS potential
  • Therapy #2 was actually less than 40% penetrated in the U.S. with even lower penetration OUS

Conclusions:

  • Therapy #2 lacked broad acceptance and adoption from physicians
  • Physicians only focused on the functional (not overall clinical) benefits of therapy #2
  • Therapy #2 was only reaching patients who were highly motivated to resolve their condition

Recommendations:

  • Therapy #1: invest in the OUS market and hold subsidiaries accountable for driving increased penetration
  • Therapy #2: Increase investment in market development, execute new clinical trials to focus on the overall clinical benefits of the therapy (not just functional), and establish new patient support groups

Results:

  • Company accepted nearly all recommendations
  • Therapy #2 secured significant additional funding and is executing against recommended strategies
  • Physicians have already responded to revised clinical messaging and this mature business is seeing renewed interest and growth