In my opinion, the product life cycle is a valuable model that helps marketers navigate the intricate device and pharma market. I’ve previously outlined the stages a product undergoes in its journey from launch to discontinuation.
Like any tool, the product life cycle has its limitations and benefits, which I’ve discussed in this earlier post.
Although marketers can make strategic decisions to guide how their product progresses through its life cycle, numerous external factors remain uncontrollable and can still significantly shape its overall trajectory.
These elements can shape the life cycle of a medical product, making some products popular for just a few years, while others maintain relevance for much longer. In this blog post, we’ll explore the key elements influencing a product’s lifecycle.
Factors Affecting the Product Life Cycle
Market Complexity
Medical markets differ significantly in competitiveness. For instance, highly competitive markets can make it challenging for newcomers to gain traction. In such cases, a product might remain stuck in the introduction stage or fail to progress entirely.
Consider Intuitive Surgical a pioneer in robotic surgery with the Da Vinci system, launched in 1999. For years, the company operated in a near-monopoly, making it difficult for competitors to enter the market and gain traction.
Economic Forces
Macroeconomic conditions—such as recessions, political instability, or healthcare system changes—can significantly influence a product’s life cycle.
For instance, privately funded medical products may experience accelerated decline or shorter maturity phases during economic downturns compared to times of expansion.
Changes in Guidelines
Major shifts in clinical guidelines and best practices can significantly impact the product life cycle.
Recommendations designed to guide healthcare professionals can result in rapid changes in adoption or rejection of certain products.
For example, new clinical guidelines might accelerate product adoption or, conversely, lead to increased rejection.
Reimbursement Policies
Reimbursement status plays a vital role in shaping a product’s trajectory. Obtaining reimbursement approval can drive growth, while losing it might precipitate decline.
Additionally, reimbursement for substitute products can alter market dynamics and affect the lifecycle stages of existing products.
Technological Advancements
Breakthroughs in technology often shorten the lifecycle of older products, especially when newer products demonstrate superior clinical outcomes.
Take coronary artery disease treatments, which evolved from balloon angioplasty to drug-eluting stents and beyond. Each technological shift influenced the life cycle of earlier generation of products.
Entry Barriers
High barriers to market entry, such as patent protection, economies of scale, or first-mover advantage, can prolong a product’s lifecycle. Conversely, low barriers to entry can lead to faster competition and shorter lifecycles.
For example, Intuitive Surgical created substantial entry barriers through partnerships with academic institutions, ensuring high switching costs for competitors attempting to enter the market.
Conclusion
For professionals in medical sales or marketing, understanding the product life cycle is essential. This management tool provides a framework to analyze the evolution of a product from its introduction to withdrawal.
While marketers can influence certain stages—like transitioning from introduction to growth—external factors remain a challenge beyond their control.
Your goal is to facilitate a successful introduction, support product growth, achieve maturity, and extend it for as long as possible.
What other factors do you think impact the product life cycle of drugs and devices? Share your thoughts in the comments below.
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