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Freshfields MedTech Update Q1 2023

Despite the challenging macroeconomic environment, the MedTech industry remains resilient, in large part driven by increasing innovation in, and consumer demand for, healthcare technology.

Digitization continues to transform the MedTech industry, enabling healthcare providers to harness new data sources and employ innovative technologies to gain valuable clinical and operational insights. At the same time, significant legal, regulatory and market changes are creating opportunities and challenges for those in the MedTech space, potentially resulting in a pivotal year for the industry. In response, we expect MedTech innovators and regulators to work collaboratively to leverage innovations in healthcare technology to increase access to value-based care, as well as to navigate a growing patchwork of laws and regulatory guidance across the global MedTech industry.

FTC Regulatory Enforcement Ramps Up for Digital Health Companies

The Federal Trade Commission (FTC) is ramping up its enforcement activities in the context of companies sharing health data for advertising purposes. Most recently, the FTC announced a proposed order banning BetterHelp from sharing sensitive mental health information with third parties for marketing and ad targeting. In addition to the ban, BetterHelp was ordered to pay $7.8 million to consumers whose health data was compromised. The BetterHelp settlement comes just weeks after the FTC’s enforcement action against GoodRx for unauthorised disclosures of consumer health data to advertising platforms. In response to the FTC’s increased enforcement activities around the illegal use and sharing of highly sensitive data, we expect digital health companies to closely examine their practices, policies and procedures around the use and disclosure of health information, particularly in relation to their advertising activities. Digital health companies should also consider whether and how to obtain affirmative express consent from consumers prior to processing and disclosing their information.

Capturing the Value of Data in Healthcare

A recent Intel report found that although healthcare data represents one-third of all data collected around the world, 95 percent of such data is unaccounted for in healthcare providers’ use of such data for clinical or operational decision-making. Finding a way to collect, analyze and use healthcare data in one common platform may be key in helping healthcare providers leverage such data to achieve value-based care. Recently, Duke Health joined forces with nference to utilize the software company’s analytics platform that deidentifies and synthesizes patient data while maintaining the integrity of the data’s potential for health insights. We expect more hospitals and health systems to partner with tech and AI companies to identify and address gaps in care, such as healthcare data interoperability, with the ultimate goal of improving the clinical outcomes as well as the health and wellness of patients. 

UK Government Publishes First MedTech Strategy

The UK’s Department of Health and Social Care (DHSC) recently published its inaugural MedTech strategy which aims to accelerate cost effective access to innovative technologies in the UK. The strategy builds on learnings from the COVID-19 pandemic, with the DHSC focusing on sustainable future growth in the MedTech industry and delivering new and improved sources of treatment and support for patients. The paper outlines four priority areas: (1) ensuring the resilience and continuity of MedTech product supply, (2) supporting innovative and dynamic markets, (3) developing data-enabling infrastructure and (4) focusing on key issues and markets, including diagnostic testing. With an implementation plan due to be published in early 2023, we expect continued dialogue between the DHSC and MedTech providers, and a more focused approach within the UK to MedTech development. Learn more about the inaugural UK MedTech strategy.