The machinery involved in creating visual representations of the interior of a body for clinical analysis and medical intervention, known as diagnostic imaging equipment, is as you would expect part and parcel of proper US healthcare delivery. The recent spate of hospital consolidations across the nation has therefore had considerable impact on the marketing around imaging equipment. Whereas previously a piece of imaging equipment, such as a big MRI machine, would be delivered to an individual hospital once every seven years, there is now a much more concerted drive for harmonization and efficiencies across the board. Imaging companies have had to change their ‘go to’ marketing strategies as a result.
Personalization and industrialization
There are currently two main trends in the industry suppliers are having to face; the personalization of healthcare delivery, and the industrialization of healthcare delivery. Imaging plays an important role in the personalization of healthcare because of the emphasis on providing ‘first-time-right’ diagnosis. Examples of this include the increasing number of announcements for oncology radiation therapies being guided by integrated imaging, or minimally invasive interventional procedures such as the replacement of valves inside the heart. The industrialization of healthcare, on the other hand, reflects the drive of healthcare delivery systems towards increased efficiencies, workflows and cost reductions. These expectations are placing demands on imaging equipment suppliers in terms of operational efficiency improvements that did not exist before.
The importance of the service component of the market has grown as a result. The equipment itself still evidently plays a role, but overall growth is being increasingly associated to the ancillary informatics and provision of end-to-end solutions. Hospitals are trying to negotiate long-term deals, affecting pricing strategies because service guarantees and future technology upgrades over a ten year period now need to be taken into consideration. These multiyear deal as strategic partnerships are very important, but they nonetheless put the imaging companies in an ‘at-risk’ model since deals are based on partnerships with hospitals and future efficiency rates of patient throughput.
Another fallout from recent trends is the drive towards centralized purchasing. Instead of the independent purchasing of the past (for example, by the Head of Oncology), hospital chains now prefer to order a fleet of equipment and platforms from one manufacturer. Suppliers have consequently had to train their workforce to be more conversed in dealing with the C-suite level of the hospitals because acquirements are now led by a chief procurement officer in charge of a centralized purchasing department instead of individual doctors.
For the future, suppliers are going to have to increasingly compete around the provision of end-to-end digital platforms. These platforms manage digitized data in order to help imaging departments improve their utilization and rates for better usage of equipment, workflow, and patient management. This model can potentially increase margins by helping tailor what equipment a clinical practice needs to purchase in connection with the services being offered. In order to build these digitized platforms, experts are predicting future M&A activity around critical components producers, IT around imaging and diagnosis, as well as artificial intelligence technology companies. The imaging equipment landscape may be changing, but the future is diagnosed as healthy indeed.
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