The medical product innovation process (part 1)
Authors: Ryan Kerstein, Christian Fellowes, Alan Selby, Victor Chua, Gursharan Randhawa, Keith Heaton, Stephen Reeders
Publication date: 20 Jul 2011
Ryan Kerstein, Christian Fellowes, and colleagues draw on their experience in bringing a product to market to advise doctors wishing to innovate
Foreword by Professor Ara Darzi
Innovation within healthcare is becoming an ever more important mechanism to improve the quality of patient care, especially in the current economic climate. In recognition of this fact, it is imperative that we all—healthcare practitioners, academic institutions, government, and individuals alike—learn to foster an environment that encourages innovation.
Whether improving patient care involves simply changing a care pathway or inventing a novel medical product, it can be achieved only with a collaborative approach, one that fosters skill sets and knowledge gathered from the organisations in which we work, private enterprise, and patients. There is still a long way to go to achieve a truly dynamic workplace that encourages the rapid uptake of new ideas—this review provides an overview of the process of medical product innovation and will contribute to achieving this aim.
Ara Darzi, head of surgery, Imperial College London, and former health minister
In 2003 two of us (RK and CF), then medical students, came up with an idea for a disposable tourniquet. We then embarked on the process of commercialising the idea. Seven years later our idea finally made it to the wards. During this journey we had to learn how to set up a company, protect our intellectual property, and ensure that we conformed with appropriate regulations.
We began with no entrepreneurial experience, no real contacts, and naive expectations about the commercialisation process. Working as doctors, we noticed that many of our colleagues had exciting ideas but never took them forward, partly because they had no understanding of how to develop them. We have therefore written this pair of articles, with the help of experts, to provide healthcare professionals with a concise overview of some important aspects of the process of bringing an idea to market.
We will outline how to develop an idea for a medical product and take it forward. In addition, we will share tips of our own and advice from specialists in the fields of intellectual property, project financing, and commercial due diligence. We do not intend these articles to be a reference guide but simply to provide a basic overview of important principles of the commercialisation process and get potential entrepreneurs thinking along the right lines (fig 1 ).
Development stage: protecting your idea
Many healthcare professionals are closely associated with academic and research institutions, so unsurprisingly they come up with innovative ideas and technologies that could change many aspects of patient care.
These ideas, inventions, knowhow, or processes that are “created” are all forms of intellectual property. Developing intellectual property to the point where it can be incorporated into a useful product requires time, money, and careful thought. Moreover, people are willing to invest in the development of a product only if it depends on intellectual property that can be “protected”—that is, the product cannot be copied because its composition is secret or covered by enforceable patents. Showing that you have intellectual property protection is therefore vital if you want to maximise your chances of success. The other advantage of intellectual property, if protected, is that it has inherent value that can be bought and sold.
Intellectual property can be protected in many ways, whether registration options, such as patents, trademarks, and design rights (covering the shape and form of a device), or unregistered options such as copyright and legal agreements (fig 2 ). Typically the unregistered option involves non-disclosure agreements, which prevent third parties from disclosing or using your intellectual property (“trade secrets”) without your permission unless it becomes public. You can get templates of non-disclosure agreements from your employer or online.
Because medical products go through intense scrutiny by regulators, and because much of the scrutiny is public, maintaining secrecy is often not possible. But where it is possible, seek patent protection for your ideas.
If your intellectual property is not protected at the right time, managed inappropriately, or is inadvertently disclosed, it may be too late to protect your invention, and its commercial potential can be severely diminished. It is therefore crucial that you seek advice about intellectual property before publicly disclosing any information, such as by publishing or presenting data at a conference, before the property has been protected. Introducing ideas into the public domain will almost always invalidate patents filed later.
Most academic institutions and NHS bodies have a technology transfer office to help staff protect ideas. Staff will need to liaise with the office if they have an idea. Typical mistakes are failure to sign appropriate non-disclosure agreements or releasing the idea or invention into the public domain.
Patents are generally considered to be the strongest form of protection and thereby add the most value to your product. As such, they are important in gaining funding and helping to realise a possible sale of your idea. Because of their importance, we sought professional advice to help prepare and file our patent, as patent law can be complex.
Initial patent research should be aimed at assessing how much of your invention is patentable—that is, whether it is sufficiently original for patent offices around the world to grant patent claims that cover the invention and prevent your idea being freely copied in the market. Previous disclosure of the idea by others or by yourself often precludes the grant of a patent claim. This is called “prior art.”
A second aspect to investigate is the risk of infringing any active patent claims or claims that may be granted in the near future. Infringement of such patents can result in legal action preventing the commercial exploitation of the device. Defending these challenges can cost hundreds of thousands of pounds and is in no one’s interest, especially when resources are scarce.
Patenting an invention is relatively straightforward and follows a well described protocol (fig 3 ). Despite this, there is little room for error, because once an application is submitted new subject matter cannot be added to the original application. It is possible to file new related applications and make minor amendments to the original application, but this can be costly and time consuming. It is therefore wise to make the original application as robust as possible.
What can be patented?
In the United Kingdom a product or process is potentially patentable if:
It is novel
It has an inventive step (including consideration of whether or not the invention is obvious to someone skilled in the appropriate field)
It is capable of industrial application.
Specific exclusions that are potentially relevant to the medical industry include:
A scientific or mathematical discovery, theory, or method
A mental act, or a method of doing business
Some software if it does not have a technical function (though this can be allowed in the United States), and
A method of medical treatment by therapy or surgery or methods of diagnosis (can be allowed in the US).
A few simple steps can help achieve a strong patent application. Many law firms have a patent division, or you may liaise with patent agents to help with the whole process. Good patent lawyers and agents will offer strategies to increase the protection of an idea through careful structuring of claims that you are unlikely to have considered. The general points to consider incorporating within an application are to:
Identify an unmet need and the problem to be solved. It is important to think as laterally as possible to increase the scope of your patent, but bear in mind that the wider the scope, the greater the chance of existing patents being infringed
Identify the preferred solution and alternative embodiments, such as in different clinical settings for the product. Once you have identified the alternative embodiments, it is important, especially for the US market, to identify the preferred version or “best mode”—this is the version that must be described in greatest detail
Understand similar inventions in the public domain. This includes searching patent and non-patent literature to develop a detailed patent landscape. This process permits assessment of what can be claimed for and where to target claims and also helps to identify why your patent is novel. It is important to search as widely as possible, and it is recommended not only to use key words but also to search different classes of patent or technology. Results of patent examiners’ searches on previously applied patents in similar fields can also be used to build up a comprehensive patent landscape.
Undertaking these steps should help maximise your chance of a successful application, but it is not possible to second guess examiners’ reactions to your submission and whether they believe that it represents or novel or inventive step. If problems are encountered with the existence of prior art then it is often possible to develop alternative ideas that are distinct. However, it is important to ensure that any potential intellectual property still covers the likely device configuration and remains relevant to the originally identified need or problem to be solved.
It is also important to know that if a healthcare professional generates an idea that is broadly related to his or her work for an employer then the intellectual property is likely to be the property of the employer. Therefore you must consult the hospital or trust’s research and development office to discuss an idea before disclosing it to third parties. If you think you have a good idea, but your employer is unwilling to go to the expense of protecting it, get the employer to acknowledge in writing that you are free to develop it at your own expense.
An invention is often a collaborative effort. When an invention makes a lot of money, all sorts of people come forward to claim a share. If you go to the time and expense of developing intellectual property, treat your co-inventors fairly but make sure you reach agreement early on as to how the proceeds, if any, will be shared.
Development stage: clinical trials and regulation
Regulations governing approval to market a new medical product are complex. Getting a new product into the NHS adds further hurdles. Our experience was that this can take a long time and requires liaising with various stakeholders, so don’t underestimate this task.
When you approach hospitals the first thing they will want to know is that your product works and that it fills the gap in the market that you claim. Therefore they will usually expect you to have done some form of clinical trial or market testing of your product.
To conduct trials, product evaluations, and subsequent marketing in the UK you will need approval from the Medicines and Healthcare Products Regulatory Agency (MHRA), usually via CE marking (see below). The MHRA’s primary role is to ensure that drugs and medical devices are fit for purpose and safe. Although it covers only the UK (each European Union member state has its own equivalent), there is a centralised procedure that allows for a single application to be sent to the European Medicines Agency.
CE (conformité Européenne) marking is a declaration that a product meets all the appropriate provisions of relevant European Union directives. The requirements for this process depend on the regulatory class into which a product falls and may be classified as class I to III, depending on its clinical risk. For class I products this is predominantly a self certification process and is based around the creation of a detailed technical file. For classes II and III and some class I products a “notified body” will also need to be involved to perform conformity assessments as required by relevant directives.
This process can be laborious because of documentation requirements ranging from specification of the product’s physical properties to demonstrating appropriate continual risk assessment when the product is in use. For our single use tourniquet it was not enough to prove that the product worked clinically; we were required to detail its exact physical characteristics, including attributes such as tensile strength and breaking point.
Because many products simply entail self certification, people may be tempted to take short cuts. Remember, however, that associated regulation means that you are liable for any product failure, as this process is intended to help identify and mitigate appropriate risk. Additionally, any potential investor will expect thorough documentation.
Introduction stage: commercialisation
Once an idea is protected, and some proof of concept is obtained, the next step is to try to take your product to market.
Bringing a product to market
Each idea will have unique features and circumstances concerning its development that demand a bespoke commercialisation strategy. Nevertheless some generic processes and considerations exist in any route to market, and these typically entail assessment of:
Commercial strategy, and
Funding requirements to support the chosen commercial strategy.
Funding can be derived from various sources, ranging from university or hospital technology transfer offices to professional investors.
Commercial strategy: technology transfer offices
Technology transfer offices offer “early stage” services concerning evaluation, intellectual property protection, and advice on commercialisation—that is, helping to decide whether to license the technology or form a “spin-out company” to develop and commercialise it.
Technology transfer offices may fund studies of proof of concept or proof of source and may support translational grant applications to develop the technology and to answer questions regarding the commercial viability of an invention. They may also have an understanding of the market where the technology is to be applied. This process is aimed at building a strong business case to convince the industry or to attract investors (more information will be given in our second article).
Commercial strategy: licensing
Most technologies arising in the public sector will be commercialised through licensing deals. These can be complex and are tailored specifically to the type of technology, its number of applications, the current market, the stage of development, investment to date, and any foreseeable associated financial or clinical risks.
Licensing technology and its associated intellectual property to a company with a proved track record of getting products to market provides an excellent commercialisation route for an early stage technology with commercial potential that has some form of intellectual property protection but requires further development.
If the inventor has proof of principle before approaching a potential licensee, some of the risk and expense is removed, and therefore more favourable terms can be agreed for the inventor. Also, for the inventor who has little interest in forming a company, licensing provides an ideal avenue to get a product to market without detracting from other activities.
Commercial strategy: company formation
A technology with a wide range of applications and the capability to sustain a standalone business may be best commercialised through a spin-out company. This may be the case particularly if there is strong engagement and participation from the inventors.
As the new company matures, the need for capital can increase greatly, and this is usually the point at which venture capital funding or similar is required. The investment will typically be used for further product development, scaling up manufacturing, clinical trials, sales and marketing, and recruitment.
Forming a new company is time consuming, highly risky, and financially demanding. It requires a strong, well informed, and commercially astute management team, together with a strong research and development base. But the advantages and rewards can be immense, in monetary terms and in personal satisfaction.
For further general information, please contact the authors:
For help with technology transfer offices: Gursharan Randhawa ( firstname.lastname@example.org)
Advice on intellectual property and product development: Keith Heaton ( email@example.com)
We thank Professor Ara Darzi for his assistance and support for this article and all the coauthors of the article.
Competing interests: None declared.
Ryan Kerstein registrar, Department of Plastic Surgery, Royal Free University Hospital, London, UK
Christian Fellowes founder, ASep Healthcare, London
Alan Selby senior associate, Torreya Partners, London
Victor Chua partner, Candesic, London
Gursharan Randhawa technology licensing associate, Imperial Innovations
Keith Heaton managing director, i2r Medical, Bournemouth, Dorset, UK
Stephen Reeders founder, MVM Life Science Partners LLP, London
Correspondence to: R Kerstein firstname.lastname@example.org