A 3-D print of an artificial heart valve.
Image: Jonathan T. Butcher, Cornell University
Estimates for the market of 3D printed biomedical products are promising. New analysis from Boston Consulting Group says revenues from 3D printed end-use biomedical devices could reach $5 billion by 2020. But other market predictions are all over the map ranging from $9 billion to $21 billion by 2020.
Such optimistic uncertainty is understandable. Real-world application examples are showing promise on the market. In a few segments of healthcare, such as dentistry and orthodontia, additive manufacturing is used daily. In audiology, 90 percent of all hearing aids sold in the U.S. have patient-fitted shells that are produced by 3D printers.
The wide prediction range of market potential has to do with opportunities that are not yet practical, although they could be game changers. Some of these possibilities include using 3D printing is being used to create microrobots for drug delivery, skin-graft material, and human organs.
BCG’s report asks the critical question of whether 3D printing is destined to be a blockbuster or a niche segment of healthcare options. It provides analysis of the potential growth and size of the market for 3D-printed biomedical products, highlight the health care sectors most likely to be affected by 3D printing, and recommend next steps for health care players.
Some of the barriers that could hinder 3D printings adoption include limitations of materials science, high cost of process and materials, quality concerns, and acceptance by healthcare payers, providers, and patients.
With respect to materials science, the BCG report says, “A faster and broader adoption of 3D printing today is hindered by a limited understanding of how the 3D printing process alters the properties of raw materials and end products.” That should change, as innovators get deeper into practical use. Printer suppliers are addressing that challenge by building real-time monitoring into their systems, government agencies and industry consortia are implementing standards and databases of material properties, and users are sharing their experiences with the technology.
The price of equipment for AM is high. 3D printers can cost as much as $2 million. Meanwhile the materials can carry a significant markup that well exceeds (by hundreds of dollars) the prices of materials used in traditional manufacturing. Experts expect those prices to fall but it is unclear when or by how much.
The absence of quality standards is slowly being rectified. Until those standards are in place however, along with better experience patients and providers are unlikely to adopt the technology.
In addition to building in risk management, providers, payers, and patients need to see that there is significant value over existing solutions. Payers need to have the results of clinical research that show clear medical benefits and better overall outcomes before they will reimburse products.
Ancillary services that enable 3D bioprinting, such as 3D imaging, scanning, design, and modeling are also expanding. The Wohlers Report, which is considered the authority on 3-D printing markets found in it’s 2014 analysis that biomedical applications now account for about 14 percent of revenues for companies that provide 3D printing equipment, materials, and services worldwide.
BCG says that business models in 3D printing have been focused on selling printers, materials, and services. But a competitive advantage will come from building a platform that enables other businesses across the ecosystem to flourish. Investors are earmarking for novel and enabling technologies in areas adjacent to the printing process, including design services, software solutions, and 3D imaging and scanning. As the report says, “the future is not in the equipment. The future is in the platform.”
As healthcare companies work to prepare for 3D printing they should engage in some critical steps to capture value where it is available. First, they should engage in scenario planning to explore how 3D printing will influence specific product segments and business models. BCG warns that although it expects slow growth, disruptive technologies in the space are a possibility. Scenario planning helps companies prepare for unexpected events.
In addition, companies need to figure out how to capture value. Firms can do this by thinking broadly about improving clinical outcomes, and addressing unmet needs. At the same time, analyze products and their supply chain to identify cost savings that may come from using less material, creating less scrap, reducing labor, or lowering tooling expenses. Consider how 3D printing could lower costs for individual SKUs, high-value parts, and highly customized products.
Experimentation is a key step in adopting 3D printing. Companies can invest in a printer in order to work with the new tool, and consider how the process could support innovative products that would be difficult with traditional manufacturing processes.
Talking with potential M&A targets or strategic partners can be valuable. Be sure to screen potential partners for probability of technical and regulatory success, as well as determine readiness for the marketplace. Leading companies are already making moves in this space. Johnson & Johnson Innovation and DePuy Synthes Products, for example, are collaborating with the 3D printing company Tissue Regeneration Systems to help develop patient-specific, resorbable bone implants.
Depending on a company’s business model, 3D printing can be a threat or an opportunity, so it is important to define a strategy. To be competitive, companies must invest now.
