This is a White Paper that I wrote, while employed at Exemplum, that talks about various marketing strategies that medical device companies can use to leverage the Internet to market their products more effectivelty.

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An Exemplum, LLC White Paper
INTERNET MARKETING STRATEGIES: MEDICAL DEVICE INDUSTRY

2. CONTENTS
Medical Device Industry Overview 2
Problem Statement 2
Medical Device Industry Challenges 3
Understanding the Target Customer 4
Marketing to the Health Seeker 4
Marketing to the Health Care Professional 6
Summary 7
MEDICAL DEVICE INDUSTRY OVERVIEW
The medical device industry is made up of companies that
develop, manufacture and market medical apparatus,
equipment, instruments, devices and supplies. The two
largest product categories are cardiac management devices
(e.g., implantable defibrillators (ICDs), pacemakers, coronary
stents and heart valves) and orthopaedic devices.
Products are marketed directly to hospitals, clinics and
physician practices; however the Internet and consumer
interest is changing the way information is presented. The
sales channel is comprised of both direct professional sales
people and an indirect distribution network. Marketing efforts
and support models must account for the global market and
accommodate different strategies for success.
Medical device companies are restricted by governmental
regulation, in both the United States and international
markets. Products may be approved for sale in one country
but not another and marketing and support efforts must be
coordinated carefully.
Precision engineering, extensive research and development
and clinical trials all contribute to the rising operating costs.
The industry is highly competitive and is driven by innovation.
Companies need to demonstrate the value of a product to
justify its selection over a competing product.
PROBLEM STATEMENT
In designing an effective Internet presence, it is imperative
that a medical device company succinctly communicate the
relative performance and cost advantages of products that are
typically complex and expensive. This product message has
become increasingly difficult to deliver due to the growing
influence of health seekers and the increased involvement of
procurement officials that hold different points of view than
health care professionals. Marketing to these different groups
requires an in-depth understanding of their motivations in the
context of new industry dynamics in order to better
communicate with them.

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MEDICAL DEVICE INDUSTRY CHALLENGES
The medical device industry is faced with a number of
challenges in 2008 and moving forward. According to
the Booz Allen Hamilton report “State of the Medical
Device Industry and Trends for 2006”, five major,
interrelated trends shaping the industry in 2006 and
beyond are: (i) continuing and increasing cost
pressures, (ii) increased need for efficiency in
innovation, (iii) an increase in outsourcing and
offshoring, (iv) the emergence of networked
automation, and (v) growth in consumer-directed
healthcare.
i
One other factor likely to have a dramatic
effect on the medical device industry is a recession of
the US economy.
Medical devices are increasingly becoming targets of
cost cutting efforts as health care professionals
continue to feel the effects of rising health care costs
and limitations of Medicare and Insurance
reimbursements. Projections show that the Baby
Boomers will begin to retire in 2011 and will
significantly impact the Medicare Trust Fund. The
Fund is currently projected to run out of money by
2019. Accordingly, bringing the HI [health insurance]
program into long-range financial balance would
require very substantial increases in revenues and/or
reductions in expenditures.
ii
Legislation efforts will
involve raising taxes, adjusting the qualifying benefit
age and/or limiting the reimbursements for devices
and procedures.
Cost Pressures: Health care professionals will be more
focused on cost cutting than ever before and this will
have an adverse effect on the amount of money a
medical device company can charge for a product and
will effectively lengthen the amount of time it takes
to recoup research and development expenditures.
The marketing efforts for a new device must clearly
demonstrate market superiority in order to be
considered over existing devices. A device’s value is
being judged more and more on its benefits and its
ability to save money through increased productivity,
reduction in head count, and other ROI factors.
Purchasing decisions are moving away from the
individual clinician and towards finance committees
and medical device companies are faced with the new sales
dimension of how to market to the financial buyer rather than
the actual physician.
Efficiency in innovation/increase in outsourcing: Efficiency in
innovation and an increase in outsourcing and offshoring are
being driven by the need to cut costs. Medical device
companies spend millions of dollars in research and
development to bring new products to market. Highly
innovative new technologies that are clearly superior to
existing competitive products are easier to market than simply
updating existing products; however, recouping the
investment in new research and development can take longer.
A relaxation in government regulations has allowed medical
device manufacturers to utilize cheaper labor in foreign
countries for manufacturing and development as well as the
clinical trials overseas.
Emergence of networked automation: Networked automation
of medical devices is another area of technology focus in new
product research. Integration with other devices for sharing
of patient information and perhaps the ability to upload into
Electronic Medical Records (EMR’s) helps justify the high cost
of a device. An example would be the incorporation of
wireless communication of take-home monitoring equipment
over the Internet into the care providers system for reporting.
Consumer-directed healthcare: Perhaps one of the biggest
challenges to medical device companies is the growth of
consumer-directed health plans (CDHPs), which offer high
deductible, lower-cost insurance for consumers. These plans
are generally thought to encourage consumers to eliminate
unnecessary care and seek lower-cost, higher-quality
providers. When patients act as consumers, the value of a
device, ease of use and future maintenance costs become
much more important in the decision-making process. This
drives the need for medical device companies to re-focus their
marketing efforts on the consumer, without losing sight of the
health care professional’s needs.
Streamlining processes can have a big impact on the
operating cost of a device over the long term and should
be highlighted as a benefit.

4. Page | 4
Impact of a US economic recession: Conventional
thinking in the financial world generally accepts that
the health care is one of the most recession-proof
sectors of the economy. People will continue to get
sick. However, the ability to pay for these services
may be in jeopardy, leaving the health care providers
footing the bill. Paul Keckley, executive director of
the Deloitte Center for Health Solutions, sees three
likely impacts from a recession: Primary and
preventive care will be delayed, people with high
deductibles will delay payments on care received, and
there will be an increase in the number of
bankruptcies from medical debt. "You can't separate
the economy from health care. It's 17% of the [gross
domestic product] right now and it will be 20% of
GDP in seven years," says Keckley.
iii
This in turn
would potentially lead to hospitals and clinics
rethinking major outlays and the value and benefits
of a medical device will be weighed heavily against
the need.
UNDERSTANDING THE TARGET CUSTOMER
The medical device industry caters to both the
consumer, or “health seekers”, and the health care
professional, both of whom are interested in different
perspectives on the same device or procedure for
which that device is used.
“Health seekers” — Internet users who search online
for information on health topics, whether they are
acting as consumers, caregivers, or e-patients.
iv
The Internet has increasingly proven itself to be both
a valuable resource for marketing a product as well as
a repository for information and misinformation.
Market analyses have shown both health seekers and
health care professionals are increasingly using the
Internet as a primary source of information in
understanding medical procedures as well as what
products are involved. It is critical that the medical
device company know whom to target and how to
educate effectively based on prospect. Is the device
consumer related? Is the device complex enough to
require on-going training and in-service guides for clinicians?
MARKETING TO THE HEALTH SEEKER
The importance of effective marketing to the health seeker
cannot be overlooked. Eighty percent of American Internet
users, or some 113 million adults, have searched for
information on at least one of seventeen health topics.
v
 66% of health seekers began their last online health
inquiry at a search engine
 27% began at a health-related website.
 72% of health seekers visited two or more sites
during their last health information session.
 48% of health seekers say their quest for information
was undertaken on behalf of someone else, not
themselves. An additional 8% of health seekers say
the search was on behalf of someone else and to
answer their own health questions. Thirty-six percent
of health seekers say their last search was in relation
to their own health or medical situation.
 53% of health seekers report that most recent health
information session had some kind of impact on how
they take care of themselves or care for someone
else: 42% described it as a minor impact and 11%
described it as a major impact.
“Health seekers” — Internet users who search
online for information on health topics, whether
they are acting as consumers, caregivers, or e-
patients.
iv

5. Page | 5
In addition:
 56% say they felt confident to raise new
questions or concerns about a health issue
with their doctor.
 56% say they felt relieved or comforted by
the information they found online.
 51% say they felt eager to share their new
health or medical knowledge with others.
On the other hand:
 25% say they felt overwhelmed by the
amount of information they found online.
 22% say they felt frustrated by a lack of
information or an inability to find what they
were looking for online.
 18% say they felt confused by the
information they found online.
 10% say they felt frightened by the serious
or graphic nature of the information they
found online.
These are extremely valuable statistics to take into
consideration when designing the health seeker
oriented pages. Millions of health seekers are doing
their own independent research and 53% of those
polled responded that the information they found on
the Internet had an impact on their health decision.
Health care professionals will be more likely to point
health seekers to a well designed site filled with
patient education as it helps them make the health
seeker feel more comfortable about the procedure.
This is of particular importance as CDHP’s become
more prevalent. It is this value-added benefit that
will help drive business to a medical device company.
With the overwhelming presence of information just
a few clicks away on the Internet, there are several
important factors to consider when marketing to the
health seeker: (i) credibility of the information in easy to
understand terms, (ii) delivery of the information with a focus
on education rather than product sales and (iii)
professionalism and uniformity of the layout design.
When considering an Internet marketing strategy geared
towards the consumer, medical device companies are under
pressure to create an engaging experience that will primarily
educate, by focusing on benefits.
Credibility of the Information: With the sheer number of
medical informational sites available on the Internet, it is
critical to establish credibility to keep the health seeker from
navigating away from your site to another. Clearly cited
sources and up-to-date information presented in a user-
friendly professional manner will elevate the credibility of your
site. Other credibility enhancements include white papers,
questions to ask your doctor, testimonials, links to other sites
for additional education, and other patient information links
such as Live Chat for additional information. Once the
credibility has been established, health seekers will spend
more time on your site, which will help with web visibility in
search engines.
Delivery of the Information: The prevalence of broadband
Internet access allows site designs to present content in a
richer more interactive manner than ever before. Health
seekers have come to expect a higher level of web experience
when looking at health information sites, especially when
researching procedural topics. One very important
enhancement is to have procedural animations focused on
how your product is involved in the procedure and how it will
make their experience safer and more comfortable.
Professionalism and Uniformity: Whether or not your
company presents products on individual sites specific to a
single product or one site that covers all products, continuity
with regard to uniform design and branding creates a
professional environment health seekers are looking for. An
easy to navigate, media rich site with a consistent layout
design will present a professional image of your company and
The more a medical device company can educate
a patient the more likely it will generate
conversations between a health seeker and the
health care professional.
The health seeker may not understand what their doctor
has told them and animations allow them to visualize the
procedure and most importantly demonstrate how your
product contributes.

6. Page | 6
product line to the viewer. Nothing kills credibility
faster than a poorly laid out web site that is trying to
push a product without regard to viewer
demographics.
Other Considerations: As noted above, it is important
to realize that many health seekers will find your site
through a web search rather than on the
recommendation of their health care professional.
The more visible your site is the more traffic it will
receive. Search Engine Optimization (SEO) allows the
prioritization of web sites by popularity and other
statistics. It is extremely important to design a web
site that will generate as much visibility as possible
through effective use of optimization techniques.
Ultimately you want health seekers to drive business
by finding your site, learning about the procedure and
your product and telling their health care professional
they want your product. This can be achieved
without actually over-marketing your product if it is
presented in the right manner. Another important
element is the ability to glean information about the
site visitors to better understand who is hitting the
site, where they are going (and not going), and other
metrics. This will allow a high degree of
understanding about the typical visitor demographic
and will facilitate more targeted designs for future
revisions and product rollouts.
MARKETING TO THE HEALTH CARE
PROFESSIONAL
Understanding what the health care professional is
interested in seeing is just as important if not more so
than understanding the health seeker. Health care
professionals are primarily interested in product
features and benefits, industry adoption and success,
and education and support both pre and post sale.
Product Features and Benefits: The health care
professional is the one making recommendations and
decisions on what product to use and therefore is
more focused on features and benefits of the product
than on the application. Information can be
presented in a more technical and graphic fashion. A
multimedia clip of the product used in surgery can be
presented on the health care professional section where that
may not be appropriate on the health seeker section. Health
care professionals have less and less time to research and
learn new products. Many medical device companies use an
independent contractor sales model to market their products
rather than employ a traditional sales force. That contractor
may offer many different products from various
manufacturers and the company is not able to effectively
control what that contractor is selling on a given call. This
trend makes the Internet a very valuable tool to present
products to the health care professional in a controlled and
more focused manner.
“*t+he average primary care physician interacts with 28 sales
representatives each week; the average specialist interacts
with 14.”
vi
Scheduling time to have an in-person sales call is becoming
more and more difficult and expensive industry-wide.
Pharmaceutical companies are meeting the challenge of
reduced face-to-face sales calls by moving towards a practice
called E-Detailing. E-Detailing enhances sales activities by
providing interactive animation, video and audio
presentations via the Internet. This allows the physician to
view the information at a more convenient time and delivers
the information in a more dynamic manner.
One of the primary focuses of the site dedicated to the health
care professional is to educate on why your product is better,
why they should use it and what it will do for them. Does the
product utilize some technology or design that will shave an
hour off an eight hour surgery? Highlighting a product’s
features and benefits and demonstrating how it can help the
health care professional through interactive presentations has
become an extremely effective way to market to this industry
demographic.
Industry Adoption and Success: Endorsements, news updates,
case studies and testimonials are all very important to
reference. These are very effective methods to establish the
credibility of the product, especially if it is cutting-edge
technology. The health care professional may have to make a
case to the insurance company on the necessity of your
“*t+he average primary care physician interacts with 28
sales representatives each week; the average specialist
interacts with 14.”
vi
There is no time for a quality sales
call anymore.

7. Page | 7
product and could potentially reference this type of
information. There may be many similar products on
the market that he could choose from so this type of
information is also very helpful in convincing the
health care professional that your product is superior.
Education and Support: There are many different
options to consider depending on the complexity of
the product when designing an education and
support section. The medical device industry has a
vast array of products, many of which require pre-
sale education, post-sale training and ongoing update
training. Many industry sales professionals are
tasked with not only selling the products but also
training the health care professional on how to use
the product post-sale. This takes the sales
professional out of the field and valuable selling time
is lost.
Other Considerations: Company news updates,
upcoming event information, white papers that
highlight what health care professionals should look
for that should trigger the need for your product,
frequently asked questions section, an exclusive
limited access Forum section and RSS News Feeds are
just a few ideas to compliment the health care
professional section of the web site. A Members Only
section for health care professionals who have
registered and been granted access can be used to
present information not suitable for health seekers or
the general public. It can also be useful to have an
area for health care professionals to request more
information by filling out an on-line form. This can
generate valuable leads for follow-up sales activities
in addition to providing a vehicle for getting
additional information to the right people.
SUMMARY
The medical device industry is complex and requires a
fundamental understanding of industry trends and customer
demographics. Federal regulations, increased competition
and cost-cutting efforts are changing the way medical device
companies do business. Advances in medicine are driving the
need for product innovation. Medical device companies are
spending vast amounts on research and development while
changes in Medicare and Insurance reimbursements are
making it more difficult to recoup those investments. Internet
marketing efforts must directly target both the consumer
health seeker and the health care professional and each
requires a different approach to be successful. Emphasis must
be on product education and value rather than simply pointing
out a product’s features. Rich media content such as product
and procedural animations, interactive product
demonstrations, and online in-service guides for post-sale
training are all highly effective ways to market to this dynamic
industry.
i
Booz Allen Hamilton, Inc. “State of the Medical Device
Industry and Trends for 2006”
ii
2007 Medicare Trustees Report, Centers for Medicare and
Medicaid Services (CMS) April 23, 2007: 27
iii
Catherine Arnst, “Health Care: Not So Recession-Proof,”
Businessweek,
[http://www.businessweek.com/technology/content/mar200
8/tc20080324_828167.htm?campaign_id=rss_daily], March
28, 2008
iv
Fox, Susannah. Online Health Search 2006. Washington, DC:
Pew Internet & American Life Project, October 29, 2006.
v
Fox, Susannah. Online Health Search 2006. Washington, DC:
Pew Internet & American Life Project, October 29, 2006.
vi
Ashley Mahoney, Rayna Herman. “2005 Access Report: The
current state of pharma sales.” Pharmaceutical
Representative. July 1. 2005.
Having interactive on-line tutorials, in depth
training presentations, detailed In-service Guides,
video on demand and other education and support
vehicles can significantly increase customer
satisfaction and bottom line sales efforts.