The trend toward lower costs of medtech product use and ownership (my #1 Medtech Future above) is undeniable. A lower-margin product line to address the so-called value segment in medtech is the obvious approach to this expanding market segment. But that obvious approach is fraught with danger, not the least of which is cannibalization of the corresponding higher-priced line.

     Some McKinsey authors address this market segment in an article entitled "Capturing the 'Value' Segment in Medical Devices". They cite several credible trends that combine to create demand for products that are "good enough" and competitively priced. They estimate that this new 'value' segment is growing twice as fast as the industry as a whole in some categories. The article goes on to recommend some prescriptions for addressing this segment.

     My recommendation is to proceed with caution. Targeting of certain segments in developing economies is an obvious approach already taken by many medtech suppliers. But even that approach has limits in an increasingly global market, and it takes plenty of capital and organizational acumen to exploit. Pulling it off in one's home country is complex, difficult and risky. McKinsey lays out some steps.

     Playing the 'value' game is not for the faint of heart. But at some point it will become impossible to avoid in just about every medtech segment. It's important to be prepared.