No Low-Hanging Fruit for Medical Device Entrepreneurs

Executive Summary

In a speech at Windhover's December 2000 Start-Up Symposium, Novoste chairman Tom Weldon argued that device start-ups will be fewer and riskier. Both the FDA and physicians are demanding trials that prove clinical efficacy, raising the cost and therefore the risk of starting new companies. That means these firms will have to target larger markets, which by their very nature will require a change in medical practice and thus also a more expensive selling effort. Unless companies go after products that can sell a minimum of $500 million annually, financiers won't be able to justify the investment required to get these companies off the ground.