The Situation
Our client, a large medical device company, was considering acquiring a start-up company with a new technology for the treatment of a chronic condition. The target indication had a large population in the US, and preliminary data indicated that the device was effective. The client needed to understand if the product had a pathway to meaningful reimbursement, and thus, revenue realization.
The Solution
We began our work by gathering information about the target company, including having multiple conversations with the start-up leadership, to get a complete understanding of the product’s functionality and data. We evaluated the existing hypotheses of the company related to product reimbursement through government and commercial insurers.
We then conducted our own analysis of the potential barriers to reimbursement and payment, leveraging primary research interviews with former Medicare payers and internal subject matter experts with extensive knowledge about the CMS decision-making process. This included a review of possible comparators and analogues, which were likely to be referenced by CMS when determining reimbursement levels for the new product.
Ultimately, we provided a go/no-go decision to the client on whether the product would make a worthwhile investment given the likely reimbursement it would achieve, noting where our analysis differed from the target company’s assumptions.
