Guest Column | December 8, 2016

Ambulatory ECG Monitoring Players: A Competitive Analysis

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By Erik J. Bracciodieta, Decision Resources Group

Ambulatory electrocardiogram (ECG) monitoring is an essential tool in a cardiologist’s practice, used to diagnose cardiac arrhythmias and to monitor the efficacy of treatments like antiarrhythmic drugs or catheter ablation.

The patient wears a prescribed monitor, usually composed of three electrode cables adhered to the patient’s chest and connected to a portable recording unit. The unit typically is worn for between two and 15 days, though the length of the prescription and the type of device depend largely on the frequency of the patient’s symptoms, comorbidities, the volume of data desired by the physician, and what the patient’s insurance will pay for.

Physicians have the benefit of a variety of monitoring options, with several companies competing to offer devices and services. These companies can be classified into five distinct types, and the key to choosing your ideal solution lies in your answers to several questions: How do you fit into this diverse landscape? Do you offer parts or software to these companies? Does the device you sell depend on a diagnosis made by ambulatory ECG monitoring devices?

Below are descriptions of each type of ambulatory ECG monitoring competitor, a few companies representative of each type, and those companies’ growth prospects, considering technological and commercial trends.

1. The Mom & Pop Service Company

These tiny operations offer short-term monitoring with well-established devices. It’s likely you’ve never heard of these businesses, including A-1 Heart Monitoring in the NYC area and Cardio Scan in Houston, Texas. Their close relationship with local physicians is the main reason these firms still exist; some physicians appreciate the idea of having the monitoring data and its analysis close at hand.

These small companies do not offer new types of monitoring, like long-term Holter monitoring and telemetry. As demand increases for these services, I see these small operations fizzling out.

2. The Up-And-Coming Technology Service Company

Companies like BioTelemetry and iRhythm Technologies offer solutions that are more convenient, collect more data, and perform more analysis than traditional monitoring. These companies usually offer their new services in addition to traditional monitoring. One area of innovation among such companies is the skin patch device: easier to wear, less conspicuous, and often water-resistant, unlike traditional electrode cable monitors.

These companies also offer devices that collect more data for a longer period of time with high-quality analytics, and interest in such companies’ services is growing. For example, iRhythm’s had its IPO in October and BioTelemetry has experienced rapid revenue growth as more payers decide to cover its cellular network-connected monitors.

These companies operate nationally and aim to displace traditional monitoring, leading to a bright outlook for their future growth prospects, especially since the reimbursement landscape for advanced monitoring has improved. These companies earn revenue for every prescription issued, so revenue grows quickly as physicians adopt the technology. However, expect fierce competition as companies introduce competing next-gen devices to win over physicians.

3. The Capital Equipment Company

GE Healthcare and Philips sell their traditional ambulatory ECG monitoring devices as pieces of capital equipment directly to hospitals and clinics. The devices usually are bundled with bigger hospital equipment or software purchases. Physicians who choose to do their monitoring in-house, instead of outsourcing it to a Type 1 or 2 service company, buy devices from capital equipment companies.

However, ambulatory ECG monitoring capital equipment sales are not lucrative. Physicians are increasingly likely to outsource their ambulatory ECG monitoring needs, especially since many innovations in this space are available only from service companies. In fact, GE Healthcare and Philips appear to recognize this, and do not innovate on their devices (i.e., update them regularly).

4. The Multinational Cardiovascular Medtech

These companies focus on implantable loop recorders, subcutaneous devices that upload data daily for up to 3 years. Medtronic has led this segment since 2014 by offering the Reveal LINQ, a device smaller than what was previously available. St Jude and BIOTRONIK also are working on such a next-gen devices. Still, since this device needs to be implanted in a hospital setting, its use is dwarfed by the types of monitoring discussed above. Of course, while implantable monitors are much more expensive than the skin-surface monitors discussed above, there is something to be said for a monitoring device that can’t fall off.

As of now, growth prospects for multinationals look pretty good. The introduction of Reveal LINQ boosted implant volumes and it’s making progress in penetrating syncope and cryptogenic stroke populations. As Medtronic has stated during earnings calls, Reveal LINQ is seen as generating additional revenue because it increases the diagnosis rate of arrhythmia, and patients are likely to seek more device therapy, such as a pacemaker, as their conditions progress.

As a result, Medtronic can increase the size of its device bundles. Therapeutic devices can be purchased on a discount basis following the purchase of diagnostic devices and the associated services for collecting and managing the data. In fact, remote monitoring-enabled cardiac rhythm management devices can continue the data collection process started by an implanted diagnostic device, offering a wealth of patient data. One can imagine this data being used for value-based payment, enabling medtech companies to offer risk-based payment schedules for healthcare facilities.

5. The Wearables Company

Cardiologists gush over AliveCor’s smartphone-enabled ECG recording device, especially since the patient often is the one purchasing the device, thus saving the physician time and money by removing his or her responsibility to deal with maintaining the equipment or dealing with the service company.

Apple has published a patent for a wrist-based ECG monitor that would compete with AliveCor’s Kardia Mobile product. Of course, these devices are limited to collecting ECG data after a patient has noticed symptoms, so their utility in serious clinical decision-making, like deciding whether a patient should be prescribed anticoagulants or get an ablation, is limited.  

So, will physicians replace all of their ECG monitoring with post-symptomatic smart-phone devices? How much data are they willing to forego for the sake of convenience? At the very least, AliveCor’s device will be used to supplement the monitoring discussed above, perhaps even contributing to the decision whether long-term monitoring is warranted for symptomatic patients.

As you can see, there is variety in both the types of ambulatory ECG monitoring currently available and the competitive landscape. An understanding of the growth prospects for each type of monitoring company is useful for strategic planning. A good understanding of the clinical and technological shifts in heart rhythm monitoring can help your business succeed.

About The Author

Erik J. Bracciodieta is a Senior Analyst on the Medical Device Insights team at Decision Resources Group, where he authors Medtech 360 products for global cardiovascular device markets. Through this work, he has become DRG’s authority on electrophysiology and structural heart devices. Erik earned an M.Biotech. and an Honors B.Sc. from the University of Toronto.

Editor’s note: Information for this report was provided by DRG’s US Ambulatory ECG Monitoring report.