1. Medtech and the Internet of Medical Things
How connected medical devices are transforming health care
Mark Steedman
21st November 2018

2. Deloitte UK Centre for Health Solutions
About us
Established in 2011, the Centre is the independent research arm of Deloitte LLP’s healthcare and life sciences practices. Its role is to inform stakeholders across health care and life sciences about emerging trends, challenges, opportunities and examples of good practice. Using primary and secondary research and rigorous analysis to drive unique perspectives, the Centre seeks to be a trusted source for relevant, timely and reliable insights.
blogs.deloitte.co.uk/health/
Publications

3. Providing health care is becoming more challenging
Global health care spending expected to grow from $7.1 trillion in 2015 to $8.7 trillion by 2020
The percentage of people aged 65 and over is expected to double by 2050
To reduce spending and improve outcomes, health care organisations are looking for medtech to demonstrate the value of their products
Deaths from noncommunicable diseases are anticipated to increase from 38 million in 2017 to 44 million in 2030
People’s interactions with the health care system often involve interactions with a wide range of products that diagnose, monitor, and/or treat patients. These devices and equipment are instrumental in helping health care providers to achieve better patient outcomes, lower health care costs, improve efficiency and enable new ways of engaging and empowering patients.

4. Report introduction
The medical technology (medtech) industry designs and manufactures a wide range of products to diagnose, monitor, and treat patients from syringes and bandages, blood pressure monitors and pregnancy testing kits, to surgical instruments, pacemakers, artificial joints, and MRI and CT scanners.
Major advances in wireless technology, miniaturisation and computing power are driving innovation in medtech, leading to the development of an increasing number of connected medical devices that are able to generate, collect, analyse and transmit data.
The data, along with the devices themselves, are creating the Internet of Medical Things (IoMT) – a connected infrastructure of medical devices, software applications and health systems and services.
Our report focuses on how the IoMT is transforming medtech’s role in health care and the impact of the increased use of connected medical devices on medtech companies’ business and operating models.

5. Methodology Detailed literature review
Insights provided by Markets&Markets
An online survey conducted by Research2Guidance
Structured interviews with senior executives from a number of large medtech companies
Insights provided by Deloitte colleagues working across the medtech and health care industries

6. Forecast by geography and component
The IoMT market
What is the current and future market size?
Forecast by geography and component

7. Connected medical devices
The IoMT market
How is the market segmented?
Connected medical devices

8. Medtech are investing in connected medical devices
Our survey of 237 respondents revealed that:
“One of our priorities is to create fully connected care.”
CxO, Medtech company
81%
Note. The figures from our research survey relate to medtech companies with connected medical devices and are not entirely representative of the medtech industry as a whole.
Source: Deloitte commissioned research from Research2Guidance, 2018

9. Challenges and opportunities for medtech
The 8 key systemic challenges and opportunities facing the medtech industry
Challenges and opportunities for medtech
improving the adoption of medical technology at scale
developing an in-depth understanding of end users
developing new funding, business and operating models
understanding interoperability requirements
maintaining cybersecurity
successfully navigating regulatory change
attracting digital talent and building digital capability
maintaining trust in a digital age

10. Developing an in-depth understanding of end users
As more providers adopt VBC models, the speed of adoption and integration of connected medical devices will increase
Data and insights on patients and processes is key to VBC
Challenges include the extent to which an organisation’s IT infrastructure is able to handle or process the connections and data, and whether clinicians and patients can be convinced of the safety and effectiveness of the devices
“The industry must have more close relationships with the ‘real’ health care system and health care providers, namely doctors and nurses. Without the partnership of the medical world all smart devices will stay only ‘nice-to-have devices’ instead of really connected devices.”
CxO, Medtech company
Deloitte’s View
Medtech companies need to develop a deeper understanding of the end-user to improve patient outcomes but also create value for key health care stakeholders. 

11. Developing new funding, business and operating models
Our survey indicated that medtech companies are working on…
Deloitte’s View
Different types of innovation will require different business models, and progress will depend on both the innovators themselves working in new ways to take on risks and rewards, and the evolution of existing payment systems by both public and private payers.

12. Addressing the challenge of interoperability
Interoperability can provide numerous benefits to health care stakeholders
Deloitte’s View
Interoperability is arguably the biggest challenge to health care’s ambition for a patient-centred, digitally-enabled, health care ecosystem. All stakeholders need to be aligned to develop open platforms and standards

13. Maintaining cybersecurity
Data breaches in health care can be large and costly
One data breach in health care affected 78.8 million people
Deloitte’s View
The cost per capita of a data breach in health care is the highest among 17 industries analysed
Given the scale of potential security issues affecting connected medical devices, all stakeholders managing and utilising the data generated from connected medical devices need to take a more proactive and collaborative approach to identify and resolve security issues.
Our survey suggests medtech are prepared to maintain the cybersecurity of connected medical devices
81%

14. Navigating regulatory change
There have been a wide range of security issues found in connected medical devices, which has lead to the development of a number of regulations and guidelines
Our survey suggest medtech are prepared to comply with regulatory changes such as MDR, IVDR and GDPR
Deloitte’s View
Medtech companies need to build engagement with regulators into their innovation models and involve clinicians and patients in product design.

15. Attracting digital talent and building digital capability
Respondents from our survey suggest that:
79% of respondents are prepared to build digital capability within their company
Deloitte’s View
Medtech companies need to develop a new, digital-first skill set, including multidisciplinary talent from creative and scientific backgrounds.
22% believe that recruiting digital talent within their company as a top three priority
“The health care system is not fully ready for IoT, [and] has a lot of catching up to do. [It] does not have the technical capabilities, nor the professional technical manpower to handle and manage the technology. Technology is moving at faster pace than the healthcare system and the regulatory system.”
CxO, Medtech company
However there is a growing digital skills gap which may make recruiting more difficult in the future

16. Maintaining trust in a digital age
Patients’ willingness to share data is critical to the long-term success of connected medical devices. For this to happen patients need to have trust in how their data will be used.
Medtech must remain vigilant in protecting patient data as more and more of their devices become connected.
Respondents from our survey suggest:
Deloitte’s View
69 % agree that patients will be the owners of their data
Medtech companies need to earn the trust of providers and patients by developing strong privacy and security arrangements.
80 % of respondents believe that their company is prepared to gain patient trust in the willingness to share data
“There is always something you don’t know around managing and using data. Exposure to more use cases will definitely help us.”
CxO, Medtech company

17. Improving the adoption of medical technology at scale
Respondents from our survey suggest:
71% agree that healthcare providers and clinicians are not ready to utilise data generated from connected medical devices
Deloitte’s View
Medtech companies need to be able to provide robust and reliable evidence to health care organisations on how technological advancements and the data generated by connected devices improves the efficiency, cost-effectiveness of care delivery.

18. Medtech’s role in transforming health care
Collaboration
87% of respondents agreed
Devices that benefit both patients and hospital providers
Advanced analytics
Joining the dots between connected medical devices and health care IT
64% of respondents believe developing a stronger analytical capability is a top three priority for their company
88% of respondents agreed
Business model transformation
90% of medtech companies are implementing new business models

19. The future for Medtech and the IoMT
Cost-effective and purposefully-designed, technology-enabled health care solutions can improve the well- being of millions of people and radically change the way services are delivered to patients

20. Contacts Authors Contacts
Karen Taylor Director, UK Centre for Health Solutions
Mark Steedman
Manager, UK Centre for Health Solutions
Matthew Thaxter
Analyst, UK Centre for Health Solutions
Amen Sanghera
Contacts
John Haughey
Partner, UK and NWE Life Sciences and Health Care Leader
Hanno Ronte
Partner, Monitor Deloitte
Emma Bairstow
UK Medical Technology Leader