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What Do Medical Device Recalls Cost Americans?
Despite significant growth and widespread excitement about advances, there are countless medical device recalls every year, as well as medication recalls and newly introduced warnings. But what do all of these recalls cost, at an individual level and for the broader economy? From the lost cost of failed products to economic losses associated with poor health, medical device recalls can lead to a landslide of financial consequences.
Industry Growth Meets Product Problems
The medtech industry is currently experiencing substantial growth. Valued at $164 billion in 2018, the industry is expected to reach $208 billion by 2023, and for patients, this growth comes with exciting improvements to their health and healthcare access. Startups have launched a variety of engaging apps, such as Safe365, which offers telehealth to senior citizens, while more traditional companies are innovating on insulin pumps, pacemakers, blood test analyzers, and other interventional devices. The fact that these are similar to existing devices, however, plays a major role in their recalls.
When a medical device is proposed to the FDA for approval, those products that are essentially improvements on other devices that have already been tested can be fast-tracked through the 510(k) program. This allows for faster growth and can help bring valuable products to market in a timely fashion, but it also means that these products don’t undergo as much testing. This streamlined process does not, however, exempt companies from warning consumers about potential dangers or to eliminate design flaws. When companies fail to do this, they could be subject to legal action, and yet in their rush to profit, many put themselves and the patients who rely on their products at risk.
Recall Costs And Competition
If one of the major costs associated with product recalls are the legal consequences – lawsuits are often settled for millions of dollars – another major cost is the administrative burden of executing a recall. In 2017, there were 3,202 device recalls, which means that the impacted companies needed to identify the complaints, alerting affected patients and providers about the recall, issuing refunds as appropriate, and collecting the recalled products. That’s a costly undertaking, and one that also places a burden on hospitals and care providers, who may need to have surgical devices removed or take on their own administrative burden in addressing patients’ recalled devices.
Resolving Recalls Quickly
Faced with so many recalls, tech experts are attempting to solve the problem, though not by preventing the recalls in the first place. Rather, the SoomSafety app alerts users to medical device recalls, so that patients are able to manage their own health in a proactive manner. Typically, patients need to wait until their doctors reach out about a recall, or they may hear about it on the news if it’s a particularly high-profile issue. That’s not a safe or effective approach, particularly if a patient is worrying that someone might hack their life-saving insulin pump or that a ventilator might fail.
This year alone, more than 50 million Americans have been impacted by a medical device or product recall, and that places a major burden on patients and their doctors. It may be time to consider whether fast approvals are worth the subsequent problems. Requiring more extensive testing before bringing products to market may not appeal to the companies behind these products, but it could improve health and economic outcomes in the long-term.
This article does not necessarily reflect the opinions of the editors or management of EconoTimes.