EXECUTIVE SUMMARY: As medical technology companies move their products and services through the development pipeline, they face the challenge of both showing safety and efficacy for regulatory approval and articulating the value of the diagnostic, treatment or monitoring technology to obtain reimbursement from payers. This article, which emerged from the 2024 MedExec Women Conference panel discussion on the topic, highlights strategies to bridge the evidence needs for regulatory approval and reimbursement to more efficiently move products along the path to market.

As medtech manufacturers, we plan carefully from the beginning of the product development life cycle to ensure we can satisfy regulators’ requirements to determine safety and efficacy of our medical technology. The regulators need evidence. The type of evidence may vary from one country to another. But, typically they require randomized control clinical trials identifying specific relevant endpoints.

As we consider how to design trials and gather the required evidence, we also need to be thinking about whether payers will consider a newly approved diagnostic, treatment, or monitoring device as medically necessary and therefore eligible for reimbursement. These public and private payers — including the Centers for Medicare and Medicaid Services (CMS) and private insurers — need evidence to determine whether they will reimburse for a product or procedure and how much they will pay for it. Early discussions with payers allow us to understand their perspective and determine the right outcomes to measure in a trial.

The question for our panel at the 2024 MedExec Women Conference was: how to gather the evidence that everybody is looking for and bridge the regulatory and reimbursement paths efficiently.

Get out of our silos
Early attention to reimbursement and collaboration internally or with partners will save you time and money.

Whether you are in a large corporation or a small startup, the requirements are the same, but the challenges are a bit different. Large corporations need to bring together their cross-functional colleagues: R&D, Clinical, Quality, Regulatory, Reimbursement, Health Economics, Market Access, Marketing, and Sales. Each department has its own focus and language, but we need to communicate across the silos, share our insights and knowledge, and commit to working together to bridge regulatory and reimbursement paths. Everyone should understand the language of real-world evidence (RWE), and reimbursement (coding, coverage and payment). Aligning businesses and product teams to think about Health Economics and Market Access (HEMA) in the same way as the HEMA team does can bring a magnitude of difference in how they work together to address evidence requirements for optimal access.

As the founder/CEO of a start-up, you have a lot to focus on and can be a silo unto yourself. First you have to admit that you have knowledge gaps, then you need to surround yourself with specialists like reimbursement experts as early as possible.  While you may know that you need to talk with payers, you may not be asking the right questions at the right time, to the right people, in the right way — if you don’t have an expert to guide you. This should be a journey of engagement over time. There are great accelerator programs out there like the NIH’s C3i (Concept to Clinic: Commercializing Innovation Program) that can point out your blind spots and get you that advice.

Build on the overlaps in trial design
Go slow to go fast. You can save money and get a better return on investment down the road if you take time up front to look at the full scope of evidence you need to gather — not just what regulatory bodies are looking for.  Anne Smart, Medtech Partner, at ZS Associates and the moderator of this panel at the 2024 MedExec Women Conference, suggests manufacturers investigate two available programs.

• the FDA Early Payor Feedback Program (EPFP) —to get early input on clinical trial design and the type of evidence that both private and public payers want to see.
• the FDA-CMS Parallel Review Program —to get simultaneous review of clinical trial design by both agencies.

These are good steps manufacturers can take to understand requirements and reduce time between FDA approval and coverage decisions. Then you can build on the overlaps and work together towards a study design that encompasses criteria for both regulators and payers. It might be as simple as adding another endpoint to a regulatory trial to address a market access question.

We all know how hard it is to recruit appropriate patients for studies. So, if we can do more in one trial to avoid the need for a separate study for reimbursement, we will be ahead of the curve. We might need to commit to a longer study and sacrifice market time, but we will get to market with an approved product and more certainty about the economics. It is important for medtech companies to develop early evidence models where they can test different scenarios that vary in level/type of evidence and estimate what the impact will be and what type of investment is needed to achieve that impact.

If medtech companies had a better understanding upfront of what evidence is needed by payers, they might make an educated decision to get to market later, knowing that their investment in the evidence will pay off in the long term. If, instead, you race to market, the result could be a lack of coverage or price pushback because the reimbursement is not adequate.

Take advantage of real-world evidence and emerging technologies
The FDA has a lot of initiatives on real-world evidence (RWE) and has issued guidance regarding the type of data that might be applicable in a regulatory submission.¹ Similarly, commercial payers in the US and CMS are open to considering RWE. They see value in analysis of data from electronic health records, claims data, device-generated or self-reported patient data, and patient registries to document outcomes in particular populations. A retrospective analysis of real-world data can provide the additional evidence that a payer needs  — without creating another clinical trial.

RWE can be a quicker route to proving the safety, efficacy, ease of use, reduction in complications, and economic advantage of a new innovation that improves the standard of care or makes diagnosis and treatment accessible to more people. This benefits both patients and payers. RWE can be especially useful in expanding coverage for more eligible patients or when thinking beyond the US, to expand into other markets. We see encouraging data that more regulators and payers around the world are accepting real-world evidence as part of their approvals.

We are just scratching the surface on what emerging technologies like artificial intelligence (AI), and machine learning (ML) can do. Some companies have begun to use AI to make our jobs more efficient; others are using it to add analytics to their product offerings to bring more clarity to the clinician’s expertise and enhance their diagnostic capabilities. When you incorporate AI or machine learning into product design, you need to build studies to support the viability of the analytics.

Anne Smart points out that, as of their May 2024 Update, the FDA has authorized 882 AI/ML-enabled medical devices². On this list, the Radiology specialty had the largest percentage of devices (>600 approvals), followed by Cardiology. This is not an unknown path anymore and there is much precedence to learn from in terms of what evidence you need for regulatory approval. CMS created the first AI-specific CPT code in 2020. As these pathways evolve, you need to do your research or leverage the knowledge of a reimbursement strategist to gain clarity on how it applies to your product.

We should also be thinking about how AI and remote monitoring could help us run clinical trials more efficiently or compile and analyze real-world data to show evidence that supports a reimbursement strategy at a lower cost. There is a lot of uncertainty all around regarding the best way to harness the power of AI and ascertain its effectiveness.

Incorporate diversity into trials and reimbursement strategies

Patients, providers, regulators and payers care about whether the evidence shows that a technology works as intended in the diverse populations that will use them. It is incumbent on us as an industry to make sure our products are designed for and studied in the patient population that will use them.

Medtech makes significant investments in clinical studies to ensure their validity and value, and we need to put effort and time into ensuring that any type of evidence collection includes the full population that can benefit from medical technology.

How we recruit for trials is a fundamental driver in how AI can help us. If we enable recruitment of minority individuals, we will have the data to train the AI model. Ensuring that clinical trial managers draw subjects from diverse populations will reduce the chance of built-in bias.  In addition, FDA has made diversity in clinical trial participation part of their review process. So, it’s imperative that MedTech companies start paying more attention to demographics and incorporating more diverse populations into clinical trials and subgroup analyses, as this will directly impact approvals and potentially time to market.³

Engage the external stakeholders

Today’s MedTech companies must engage with the entire stakeholder ecosystem (not just doctors) as early as possible to understand their unique needs, requirements, incentives, disincentives and underlying cognitive biases that drive decision making. Stakeholders include providers (hospitals, clinicians), patients, caregivers, patient advocacy groups, regulators and payers, as well as investors.

We need to understand the evidence needs and build collaboration and trust with these diverse stakeholders. Whether you do it yourself, or hire a consultant, engage early and often and incorporate interactions with the stakeholders into your strategy. Tailor your value proposition for each audience and share the economic argument when it’s important to them.

Providers (both hospitals and clinicians) often make the buying decision for medical technology, so we must understand their different pain points. Then we can use evidence to address those points, while showing metrics on the anticipated outcomes for patients. We also need to think more broadly about the decision-makers. While the clinician prescribes and insurance pays, in some cases patients may take a more active role in making a decision about the type of treatment or brand with which they are most comfortable.

So, we need to consider the insights of patients and caregivers as we develop trials and gather evidence on how an innovative approach to a condition would benefit them. Their input can increase the likelihood of good patient adherence to a protocol, which is key to their recovery or successful control of a chronic condition.  Patient adherence can be very important to payers, who want the best outcomes and to get value for their money.

Advocacy groups can be a good window into patient needs and preferences. These groups care about efficacy of a treatment and access, so reimbursement is a shared goal. They sometimes use their resources to spearhead an innovative technology, helping a company get it to the market faster and get reimbursement sooner.

As an industry, we often have informational and pre-submission meetings with regulators, but don’t spend enough time in the payer channel. Payers are the gatekeepers in every market around the world. We need to know what’s top of mind for them and what’s keeping them up at night. We need to show them how new advancements can bring value to the overall cost of patient care through better clinical outcomes and decreased disease burden. Take advantage of pre-market engagement opportunities with CMS and other payers to discuss the evidence they are looking for.

When you meet with your Board or Investors to understand their expectations, they will look at cash flow and projections, but are even more concerned about revenue generation over the long term. Anne Smart notes that a robust understanding of the ROI and cost/benefit of different evidence strategies and the expected adoption and reimbursement will provide a realistic view of the trade-offs, allowing for better business decision-making. Understanding reimbursement early on will be to your advantage. Today’s investors are demanding that start-up companies demonstrate a clear path to achieving optimal reimbursement in their overall strategies. This impacts deal discussions and interest from acquirers.

Developing your strategy

To summarize, MedTech leaders have made great progress over the last 10 years in bridging the regulatory and reimbursement paths. It’s not perfect yet, but we have more awareness both internally and externally, including by investors and members of the Board who know that planning for reimbursement early is vital to success. We’ve learned to:

• Align across the regulatory and reimbursement requirements – within our companies and partnerships
• Look for overlaps in evidence
• Leverage real-world data to optimize spend on clinical trials
• Take advantage of the power of AI
• Incorporate diversity into trials
• Talk with the full range of stakeholders early and often

The biggest fear from a revenue generation perspective is that you celebrate regulatory approval, then learn that a big insurer or a country’s health system won’t cover it. You realize that you should have talked with them early on.

Whether large or small, every MedTech company needs to look at health economics and plan ahead for market access. Our industry develops innovative products to improve human health, and reimbursement gives patients access to these life-changing medical technologies.

1 https://medtechintelligence.com/news_article/fda-issues-updated-draft-guidance-on-use-of-real-world-evidence/

2 https://www.fda.gov/medical-devices/software-medical-device-samd/artificial-intelligence-and-machine-learning-aiml-enabled-medical-devices#resources

3 https://www.fda.gov/patients/clinical-trials-what-patients-need-know/diversity-clinical-trial-participation