Authors : Jenny Chen, M.D. and Adele Wang

3D printing[1] (3DP) has become a key driver in the progress of healthcare technologies in recent years. Along with other high-valued, high-complexity, one-off manufacturing such as in defense, aerospace, jewelry and automobile parts, the production of medical models, implants, prosthetics, surgical guides and even live tissue are becoming increasingly viable with the advent of 3D printing technology.
Despite the struggles experienced by public 3D printing hardware companies like 3D Systems and Stratasys, the adoption of 3DP is continuing its strong trend. Terry Wohlers, the leading 3DP industry analyst, estimated in the 2015 Wohlers Report that the additive manufacturing (AM) industry, consisting of all AM products and services worldwide, grew 25.9% YOY to $5.165 billion in 2015. The report also estimated 13% of the market[2] to be in medical, which puts the size of the healthcare 3D market at about $671M….

This white paper will provide insights on current health care 3D printing market estimation and prediction, as well as current investment strategies and patterns. 

Ms. Wang has over 10 years and $200+ million in M&A experience. Previously, Ms. Wang served as Senior Manager of Corporate Development at EFI, Inc., where she helped develop and execute the Company’s acquisition growth strategy. During her tenure, Ms. Wang successfully managed and closed numerous M&A transactions, representing over $100 million in aggregate value. Her efforts enabled EFI’s target of $1 billion revenue in 2016. As part of the Wells Fargo Corporate Development team, Ms. Wang executed strategic acquisitions of asset-backed loan portfolios and aircraft leasing JV’s, representing over $110 million in aggregate value. Prior to, Ms. Wang was part of the Wells Fargo Corporate FP&A group, focusing on forecasting, budgeting and analysis for the Wholesale Commercial Banking division. She was instrumental in the post merger integration of the Wachovia Bank acquisition, as well as in the implementation of key company-wide finance initiatives.

Jenny is trained as a neuroradiologist, founder/CEO of 3DHEALS, a company focusing on curating healthcare 3D printing ecosystem. Her main interests include medical education, 3D printing in the healthcare sector, and artificial intelligence. She is also a current adjunct clinical faculty in the radiology department at Stanford Healthcare.

The post 3DHEALS White Paper: Healthcare 3D Printing Investing – Are We At the Tipping Point? appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA

(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

Printer/material selection:

For comprehensive lists of printing process/printers and materials used for healthcare 3D printing, the readers can refer to our book or return to see an updated list later this month.

1. Printers:

Key performance characteristics in selecting printers include the followings [36]:

– Speed

– Resolution

– Autonomous operations

– Ease of Use

– Reliability

– Repeatability

– Material/Multi-material capability

Of this list, speed is the most important issue for pre-surgical use since the need for the model may be urgent but printing usually takes hours and sometimes days. Improvement methods vary by process and include changing the printer head movement from a Cartesian to a Delta configuration (which allows for shorter paths from one point to another), optimizing the movements of laser, and using higher quality components. The multi-material and multi-head capabilities are also of particular interest. For example, models of the heart with color-coded parts such as veins, arteries, etc. can be made faster if the sections are not made piecemeal. Models for surgical practice often require materials with different haptic properties and would be made much faster if, once again, the complete model could be made at once and not in a piecemeal fashion.

2. Materials:

There are only a handful of 3D printing materials that are biocompatible and can be readily sterilized. [47] A variety of materials with different strength, elasticity, color/transparency will provide additional benefits for pre-surgical 3D prints. In addition to added materials, new sterilization techniques that do not require high temperature or toxic chemicals, and techniques that require less time will all prove useful in the future.

Currently, different 3D printer manufacturers also produce 3D printing materials presumably optimal for their printers. Therefore, the ultimate purchase decision should start with the current and potential future applications for which the printers are intended.

Three questions need to be answered:

1) Primary applications of the 3D printing — the requirements in terms of resolution, color, and texture of a model for conceptual purpose or device prototyping are significantly less than a model intended for hands-on practice before a complicated surgery. If the model were to be extensively used in close proximity to the surgeon intra-operatively, then selecting a system that avails more options in sterilizable material selection would be important.

2) Size of the print — this could be related to the specialty for which the setup is intended. For example, the print size capability of a system dedicated for craniofacial reconstruction will be very different from a system dedicated to Orthopedics. A printing system shared among different specialties will require a large enough platform for everyone, and therefore, it will be more expensive.

3) Other future healthcare-related 3D printing activities — other than pre-surgical applications, there are a variety of existing and future healthcare applications, from medical training, rapid prototyping, research, to patient-specific implantable devices. If one was to invest in a 3D printing system, calculations for potential future revenue stream may be necessary during the selection process. A 5- to 10-year revenue strategy may be necessary. We will elaborate more on this in the financial section.

Software selection:

1. The cost to use — open vs. commercial software.

“Free” may not be “cheap”. The cost of using free open source software includes lack of documentation or instruction, lack of technical support in case of dysfunction, lack of continuous development or updates. Although this is a viable option for users with a small 3D printing budget and technological savvy, be prepared to invest a great deal of time at the beginning to learn to use the software. Lack of time is often prohibitive for busy clinicians to learn the software themselves. Commercial software like Mimic (Materialise, Belgium) has very expensive annual licensing, discouraging many who only want to experiment with 3D printing. Nonetheless, these commercial options have more intuitive designs and great technical support and often offer personalized education/instruction time for users to fully grasp 3D printing within a very short period of time.

2. Future trend — automation and streamlined workflow.

Segmentation is the most time-consuming step of DICOM to STL conversion. Anecdotally, one radiologist can spend up to 13 hours to segment a complex heart model. Others have spent less time but still often in hours of magnitude. Automated segmentation will be a significant future development in the software area and will prove to be extremely valuable for cost-saving improvements. Additionally, more streamlined workflow from imaging acquisition to 3D prints from a software perspective is also what many users are hoping for. According to recent interviews with field experts, many larger PACS vendors are now developing DICOM to STL conversion capability with their newer software versions. Segmentation tools are also included in these newer versions. Many existing 3D printing companies are also actively developing products that are more user-friendly especially to the healthcare industry. Examples of these include Autodesk (CA, USA), and 3D System (NC, USA).

https://3dheals.com/idea-to-implementation-in-house-cost-consideration-for-3d-printing-for-surgical-applications-part-1/

The post Idea to Implementation: Tactical Issues — Printer and Material Selection appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA

(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

To demonstrate a financial analysis, we have created spreadsheets, which you can use as a basic framework to construct a financial plan for setting up a 3D printing service (Link). [29,30] The following is a discussion of two hypothetical scenarios to demonstrate how this spreadsheet works. Please be aware that the values used could vary widely and should not be used as reference numbers. For example, construction of a dedicated area for a 3D printer is highly variable depending on the hospital, geography, type of machine, regulatory requirements, etc.

In Hospital 3D Printing Service Financial Plan (Link):

Scenario (“Worksheet” part):

A community based subspecialty hospital wants to justify setting up a 3d printing center for cardiothoracic surgeries. They want to expand this service to other specialties but want to start with the cardiothoracic department, using 3D printed models for as part of patient education and pre-surgical planning. For this service, they plan to charge such that after all Medicare and other discounts, they are receiving $4000 per print in net revenue. The hospital has determined that 30 patients out of 300 patients per year would benefit from the model and that the new service will attract two new patients as a result. Thus, the hospital will start their planning calculations for the first year at 32 prints at $4000/print leading to $128,000 in revenue. The two new patients per year each increased additional $40000 surgical revenue to the hospital. Total net revenue is $168,000 for the first year.

Next they determine what equipment is to be purchased based on their application and needs. Since this is used in pre-surgical planning, precision/accuracy, good resolution and sterilizable material are all important. In cardiac cases, time is often of the essence where turnaround time needs to be in 1 or 2 days. Thus, a high speed printer is required. Multicolor is extremely useful in showing complex anatomies including the vascular structures. A typical machine that meets these requirements would be Stratysys Objet500 Connex 3, which costs roughly $300,000 including a maintenance contract.

The hospital has a well-developed radiology team who is versed in 3D imaging. To make the 3D print, a radiologist will spend on average 4 hours more than their usual time, at $200/hr to perform the detailed segmentation. Approximately $26,000 will therefore be spent on radiology time.

The technologist requirement is estimated to start and remain at one half person for 10 years. Their salary is estimated $60,000 per year so the technologist cost is $30,000 per year.

The installation fees (including transportation) is $1000. Remodeling costs are estimated at $400 per square foot in a 150 square foot room, for a total of $60,000. Cost of training is estimated at $5000. It is assumed that any insurance needs are already covered by the hospital, thus no additional insurance is required. Again, these numbers are highly hypothetical and will vary significantly, depending on existing infrastructures.

Results:

The “results” spreadsheet (Table VI) looks at the cash flow over 10 years. First the gross revenue is calculated by multiplying the number of procedures by the amount charged per procedure. The revenue is then adjusted to take into account the mix of discounts and patients with Medicare, Medicaid, etc. Added to this is any additional revenue generated, such as from new patients, over and above that from the new procedure. This sum is the net revenue — the additional cash taken in due to the 3D printing. In our example in the out-source model in Year 1, we have 32 procedures at $5000 per procedure for a gross revenue of $160,000. After discounts ,our revenue drops to $128,000. However, we attract in new patients who have additional procedures. That additional revenue of $40,000 brings our net revenue to $168,000.

Next the costs are accounted for. As described earlier, there are fixed and variable costs, which are seen in the in-house model. For the in-hospital model, there is significant cost of acquisition, which amounts to $367,600.

The annual fixed cost is estimated to be 32,000, assuming an additional half-time technologist is needed. The variable cost is about 800 per print, assuming a total of four hours of post processing time is needed from the radiologists. The total annual fixed cost is therefore, again, 25,600.

The sum of the costs is the net expenses. In our Year 1 case, the costs are what we are paying to set up the 3D printing center and to hire new technologist. In addition, we have additional cost of a radiologist’s time at $200 per print, assuming approximately 4-hour post processing time from the radiologist. The total of these costs are the $425,200 of expenses.

The net income is the difference between the net revenue and the net expenses. If the number is positive, you have a profit. If it is negative, there is a loss. Our example shows a loss of $257,200 for the first year.

The breakeven volume is the number of procedures needed to have no profit — where the revenues and the expenses match. In this spreadsheet, the additional revenue comes from new procedures attracted due to employment of the new technology. We assume two new patients will be attracted for year 1. We also assume a subsequent of 10% increase in new patients in subsequent years. Obviously, patients come in integer, and 10% is more of an average annual percentage growth spread over 10-year period. The Year 1 breakeven is 125 prints. Since we only did 32 prints, we end up with a loss, even accounting for additional procedural revenue.

The net present value (NPV) is the value of the 10 years’ worth of net income in today’s dollars. Due to inflation, $10 today is worth more than $10 a year from now. To determine the total worth of the project for 10 years in today’s dollars, the values for Years 2–10 need to be discounted. The rate at which they are discounted is decided by the analyst. That rate is filled in on the Worksheet tab and is used to calculate the results. Using a 2% discount rate, which is set on B57 on the “worksheet” section of Table VI , we see an NPV of approximately $ $1,359,600 over 10 years.

To be continued…)

Download Financial Spreadsheet for In-House 3D Printing Service here.

The post In House Cost Consideration for 3D Printing for Surgical Applications Part 2 appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA

(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

Capital costs are one-time, fixed set-up costs incurred on the purchase of equipment or construction after which there will be only recurring operational or running costs. Operational costs include fixed costs, which recur every year, and variable costs, which are volume dependent. All of these costs must be examined when reviewing a proposal for creating an in-house 3D printing facility.

Accumulation of high-quality data on costs is difficult since without a CPT code there are multiple reimbursement pathways and no reliable, repeatable process to collect costs. For example, sometimes, the cost can be bundled in an outsourced pre-surgical process by medical device companies, with a significantly elevated price tag. (Figure 1) However, more often, researchers, providers, surgical centers, and some industrial partners have to absorb the costs of creating the 3D print. Methods to collect and document costs for every case should be employed, as each case can be considered a potential data point in a future larger scale (and possibly multicenter) clinical trial.

Capital Costs

The cost of providing 3D printing service can range from a few hundred dollars to millions, depending on the goal of the medical/surgical center in providing such service. Modest setups for simple models for patient education could have a capital expenditure under $10,000. On the high end of the spectrum, the authors have seen a proposal for a Veterans Association facility requesting $1 million for a fully equipped in-house 3D printing service with high-capacity printers and software. This facility would be performing in-house prosthesis work with significant cost savings that would offset this high initial cost.

Although it may be simple for a hobbyist to set up a printing machine at home, in a medical facility there are many factors to consider. Utilization of this technology is relatively new. Thus, there are many potential environmental, regulatory, and legal issues yet to be properly addressed. For example, certain steps of the 3D printing process may potentially involve or create hazardous materials or work environments. Thus, upgrading facilities to handle power requirements, and ventilation and chemical handling for post-processing operations may cause a significant increase in capital funds required.

Capital costs include the hardware, software, and built out facilities. For a frame of reference, some sample costs to be included in a proposal for capital funding are provided:

3D printer

● Imaging software

● Segmentation software

● CAD/CAM software

● Standard computer for administrative functions

● High powered computational computers

● High resolution monitors

● Fume hood/Ventilation setup

Funding is required to pay for these capital costs. Most academic hospitals can allocate existing research grants to create 3D printing service without expecting any near-term return.

Fixed Costs

Fixed costs remain constant within a range of activities but vary per unit. For example, a technician’s salary is fixed for the year. If there were two technicians, the salary fixed cost would double. The salary is not changed if the facility makes 100 or 1000 3D models.

Fixed costs to maintain a 3D printing facility include personnel salaries, equipment maintenance contracts, facility costs, training costs, cost of material, and the labor involved in creating a final clinical acceptable print.

Ongoing costs of maintaining a 3D printing facility include personnel salaries, equipment maintenance contracts, facility costs, training costs, cost of material, and the labor involved in creating a final clinical acceptable print.

The following are sample fixed costs:

● Technician and Engineer salaries

● Equipment maintenance and vendor service agreements

● Training

● High bandwidth network for file transfer

Variable Costs

Variable costs change in direct proportion to volume.

For 3D printing, the materials are variable costs. The choice of material is huge, and the costs vary widely also. The amount of material used will also vary with each application.

If specific clinician time is charged to a project, that expense can be considered to be variable. If hourly labor was used to make the print vs. a salaried technician, it would be considered a variable cost.

In the next post, we will reveal our initial attempt in generating a financial spreadsheet that will help our audience with their own financial planning for a 3D printing service.

To be continued:

https://3dheals.com/idea-to-implementation-in-house-cost-consideration-for-3d-printing-for-surgical-applications-part-2/

The post In House Cost Consideration for 3D Printing for Surgical Applications Part 1 appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA

(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

Research firms generally agree that the healthcare sector of the 3D printing market is about 15%. But 15% of “what”? For example, Research Beam[1]estimates the total global 3D printing market to be at $2.8 billion, which would value the healthcare sector at $420 million. According to Wohlers Report 2016, the additive manufacturing (AM) industry grew 25.9% (CAGR — Corporate Annual Growth Rate) to $5.165 billion in 2015 — which would value the healthcare sector at $774 million[2].

Many market research firms report on specific numbers for the healthcare sector of the 3D printing market, and once again, the results vary significantly. As shown below, Allied Market Research forecasts a market twice as large and growing at twice the rate as the Orbis Researchprediction.

Given this range of numbers, it is likely the market researchers are not measuring the same items. Thus, if you are willing to invest in buying a market research report, it will be important to understand what is and is not included in the report, and if it applies to your requirements.

The market for 3D printers for all sectors is growing even faster. In September 2015, Gartner predicted that the worldwide shipments of 3D printers would reach 496,475[5]in 2016. Again in October 2016, Gartner reported that the worldwide shipments of 219,168 3D printers in 2015 would more than double to reach 455,772 printers in 2016.[6] Although the forecast numbers have decreased by approximately 50,000 units, the rate of growth is still spectacular. The growth in 3D printers has been accelerated by the expiration of several major 3D printing patents, and rapid technological innovations and quality improvements. The added abilities of printers increase the end-use market, thus driving the demand for printers and the overall market size.

What is driving this growth in the healthcare sector?

Allied Market sees the primary demand growth coming from the need for customized external wearable devices for a growing geriatric population who are experiencing osteoporosis, a growing number of amputations, auditory loss, and dental problems.[7] Technological advancements driving market growth include printers able to use multiple materials, the ability to print in multiple colors, and an increasing set of available biocompatible materials. Orbis sees different growth drivers, such as the growing need for medical device manufacturers to produce automated products, the increasing number of cost-curbing initiatives, and the rendering of simulations to perform or prepare for medical procedures.[8]

Where is the healthcare market?[9][10]

Market researchers agree that the major market is currently in North America, with a market share ranging from 35–40%. This is due to the growing presence of high patient awareness levels, increasing healthcare expenditure, sophisticated healthcare infrastructure and increasing investments in R&D facilities pertaining to the development of 3D technologies based products. However, there are discrepancies around which sector is predicted to have the most growth. Allied Research sees the most significant growth is coming from Asia-Pacific. Orbis finds that Europe is expected to be the fastest growing regional market over the forecast period due to the presence of a large number of R&D funding programs, and the increasing demand for customized medical devices in this region. It is expected to drive market growth over the next six years.

Who are major market players?

The 3D printing healthcare market is largely consolidated. Majority of the market share is governed by the two leading players, 3D Systems Corporations and Stratasys Ltd. In addition, the key market players have adopted strategic partnerships to accelerate the product development process.[11] However recently, these companies are having difficulties.[12]Fox Business reports that Stratasys and archrival 3D Systems (NYSE: DDD) have struggled to grow revenue since early 2015 due to a widespread slowdown of 3D printer purchases among enterprise customers. Stratasys posted a year-over-year revenue decline of 6.2%, driven by a 20% drop in 3D printer sales. Adjusted earnings per share — the most important earnings metric — declined from $0.01 to nearly $0.00. 3D Systems has had a rough 2016 — discontinuing their entire desktop 3D printer line and management changes including a new CEO and CFO in April, and the resignation of both the CMO and COO in June 2016. [12][13][14]

At the end of 2016, a tough year for most, the Motley Fool Investor published an in-depth analysis of the two market leaders and events affecting the companies.[14] A key takeaway is that increased competition is on the way from HP and Carbon3D who are entering the polymer 3D space. GE is also making an aggressive entry into the industrial metal market with the purchases of Arcam and Concept Laser, while their attempt to purchase SLM Solutions fell through.

Other important companies involved in the healthcare sector include EnvisionTEC, Materialise NV, and 3D Systems Software. Companies specifically involved 3D bio-printing include[15]: Organovo, Cyfuse Biomedical, Ekso Bionics, BioBots, Aspect Biosystems, 3D Bioprinting Solutions, and Rokit.

What are the analysts’ materials and methods?

Allied Research and Orbis both agree that polymers are the most preferred materials in the 3D printing healthcare market, but once again they differ on the market share — Allied at 50% and Orbis at 35%. This is driven by the high usage rates in bio-medical models. Both agree that the ceramics segment is projected to be the fastest growing due to its use in the manufacturing of teeth and jaw bones. For technology, the firms agree that laser/electron beam melting is the fastest growing due the growing demand in manufacturing orthopedic implants and hip stems.

What are the market challenges?

The 3D market in healthcare still faces significant challenges to growth. First, there is a shortage of sufficient clinical data to justify expenditures and insurance reimbursements. Second, there is a lack of structured regulatory frameworks. For example, in the US, the FDA has issued a guidance paper but no rules. Legal precedent regarding liability, patents and copyright is still murky. In general, the high costs associated with advanced 3D printers is also a barrier to entry.

In conclusion, the outlook on the healthcare 3D printing market is bright. This is not only supported by analysts, but also by the recent growth of a vibrant 3D printing market as a whole. Given the multi-trillion-worth total U.S. manufacturing market, the upside potential of market growth for the healthcare 3D printing sector (currently <1 billion) is tremendous. Multiple organizations, companies, and government agencies are now organizing themselves to create manufacture standards, regulations, and laws specific for healthcare 3D printing to meet the challenges the market faces.

References:

[1] https://www.whatech.com/market-research/it/229633-worldwide-3d-printing-market-is-in-the-progressive-phase-of-its-life-cycle-valued-at-2-811-8-million-in-2014-and-is-growing-at-a-cagr-of-21-during-2015-2020

[2] http://www.forbes.com/sites/tjmccue/2016/04/25/wohlers-report-2016-3d-printer-industry-surpassed-5-1-billion/#18694ae97cb1

[3] https://www.alliedmarketresearch.com/3d-printing-healthcare-market

3D Printing Healthcare Industry — Market Size, Analysis Jan 2016

[4] Http://www.medgadget.com/2016/11/global-healthcare-3d-printing-market-analysis-share-trends-and-forecast-by-2020-market-research-report-2016.html

[5] http://www.gartner.com/newsroom/id/3139118

[6] http://www.gartner.com/newsroom/id/3476317

[7] https://www.alliedmarketresearch.com/press-release/3d-printing-healthcare-market.html

[8] http://www.medgadget.com/2016/11/global-healthcare-3d-printing-market-analysis-share-trends-and-forecast-by-2020-market-research-report-2016.html

[9] https://www.alliedmarketresearch.com/3d-printing-healthcare-market,

[10] http://www.orbisresearch.com/reports/index/healthcare-3d-printing-market-analysis-by-application-surgical-guides-implants-surgical-instruments-bioengineering-by-technology-electron-beam-melting-stereolithography-droplet-deposition-manufacturing-by-raw-material-metals-biological-cells-polymers-cera

[11] https://www.alliedmarketresearch.com/3d-printing-healthcare-market

[12] http://www.foxbusiness.com/markets/2016/11/16/stratasys-earnings-3d-printer-sales-drop-20-stock-plummets-12.html

[13] http://www.fool.com/investing/2016/11/23/3d-systems-vs-stratasys-which-3d-printing-company.aspx?source=djc&utm_campaign=article&utm_medium=feed&utm_source=djc,

[14]http://www.fool.com/investing/2016/11/25/the-7-top-happenings-in-3d-printing-in-2016.aspx?source=djc&utm_campaign=article&utm_medium=feed&utm_source=djc

[15] https://3dprint.com/88792/3d-bioprinting-companies/

https://3dheals.com/idea-to-implementation-out-sourced-financial-plan-for-3d-printing-for-surgical-applications%e2%80%8a-%e2%80%8asample-financial-worksheet/

The post Idea to Implementation: The Healthcare 3D Printing Market appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA
(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

Healthcare is a highly regulated industry. Understanding local healthcare market and reimbursement strategy is essential to the survival and growth of any new medical technology. In order to be eventually viable financially, most U.S. 3D printing service providers need to answer two questions:

How is the service paid now?

There is currently no established stand-alone reimbursement process for pre-surgical planning 3D printing service. Occasionally, services provided by established 3D printing companies such as 3DSystems/Medical Modeling (Denver, U.S.A.) can get paid indirectly by their contracts with a medical device company, who bills third-party payers for the cost of the medical device which includes 3D printing services.

For example, craniofacial reconstruction surgeons will use the pre-surgical planning 3D printed models and/or cutting guide made by Medical Modeling, Inc. (3DSystems, Denver, U.S.A.), who has a contract with Stryker. Stryker bundles 3D printing services under a single medical device fee, and the hospital bills third-party payers for it. (Figure 1)

Figure 1. An example of current 3D printing reimbursement process (arrows represent direction of payment)

The result of such bundled billing is a lack of cost transparency. As the interest in 3D printing for surgical planning grows, however, more providers are now willing to pay out-of-pocket either at full price or at a negotiated price with 3D printing companies directly for similar services, bypassing any third-party (Figure 2). There is a trend towards more existing commercial 3D printing service providers venturing into the pre-surgical 3D printing arena. For example, Anatomics (St Kilda, Australia), 3D Ops (Tennessee, USA), and Whiteclouds (Utah, USA).

Figure 2. An example of future 3D printing reimbursement process (arrows represent direction of payment)

Additionally, a growing number of larger healthcare organizations and academic hospitals, such as the Harvard hospitals, Mayo Clinic, and Cleveland Clinic have dedicated significant internal research and development grants to develop in-house 3D printing centers. However, payers currently do not reimburse expenses for 3D printing at all if performed “in-house” or “in-office”. Thus, currently, 3D printing service appears to add costs to the overhead of health care facilities. Some have suggested potential cost savings for the hospital to provide 3D printing service as part of the surgical care, but these remain to be anecdotal [27].

How will the service be paid in the future?

For either “in house” and “outsourced” 3D printing services to be paid consistently, future work must be done to a have a procedural terminology (CPT) code created and the associated professional and facility fee assigned. The reimbursement for the physician and hospital services would then need to be negotiated with payers, insurance groups and the Centers for Medicare and Medicaid Services (CMS). [27] To achieve such “code-able” status by the AMA (American Medical Association) [48], the procedure must be officially recognized as part of patient care, which has demonstrated sufficient clinical evidence that the procedure improves patient outcomes.

Although many recent papers have documented significant improvements associated with multiple outcome metrics including reducing operating time and surgical accuracy [13], the results are still too early and too little to convince the payers. Another added challenge also includes lack of an advocacy entity for this purpose. However, this will likely change as the field matures.

https://3dheals.com/idea-to-implementation-in-house-vs-outsourced-3d-printing-for-surgical-applications/

The post Idea to Implementation: Reimbursement, the Elephant in the Room appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA
(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

Clinical trial design should be an important part of the strategic consideration because more clinical evidence, especially in terms of clinical efficacy and outcomes, will strengthen arguments for reimbursement. According to ClinicalTrials.gov [52], a registry for clinical trials maintained by NIH and NML, “a clinical trial is a research study in which human volunteers are assigned to interventions (for example, a medical product, behavior, or procedure) based on a protocol (or plan) and are then evaluated for effects on biomedical or health outcomes.”

Good clinical trials serve several major purposes such as:

a) Informing consumers about the values of this technology.

b) Preparing data for new CPT coding and other reimbursement strategies from payers.

c) Inspiring creative innovations.

Data on clinical outcomes is crucial. In recently published studies, researchers have been focusing on the following outcome metrics: operating room time, hospital stay, surgical complication, and post-surgical accuracy. Non-quantitative outcome metrics include patient/family satisfaction.

There are two public clinical trials registered on clinicaltrials.gov for pre-surgical applications (Link). The first one is a recently completed randomized controlled clinical trial (Link) from Cleveland Clinic, “Acetabular Shell Positioning Using Patient Specific Instruments” which has shown a statistically significant increase in anteversion accuracy when using a 3D printed surgical guide over traditional planning methods in total hip arthroplasty (THA) [31]. A limitation to the study is a modest sample size of 36 patients although it is larger than most recently published studies. A second drawback of the study is the lack of information on other clinical outcomes, including hardware loosening and failure as a result of inaccurate placement. This latter issue will require long-term, continuous follow up with the patients.

The second study is currently enrolling (Link). It is focusing on 3D printed patient-specific simulations for endovascular aneurysm repair as a pre-surgical training tool.

https://3dheals.com/ideas-to-implementation%e2%80%8a-%e2%80%8awhat-are-the-major-operational-management-challenges-in-using-3d-printing-for-pre-surgical-application-today/

The post Idea to Implementation: Clinical Trials For 3D Printing Applications appeared first on 3DHeals.

Idea to Implementation: Talent Allocation in 3D Printing for Pre-surgical Applications

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA
(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

Currently, most medical centers rely on individuals who are 3D printing enthusiasts. These staff members are motivated and capable of learning new skills, often on their own time without additional compensation. Over time, as the demand for 3D printing increases, many centers will find themselves exhausted of manpower. Ultimately, letting hobbyists man the 3D printing center is not viable for a professional operating facility. To provide reliable 3D printing services consistently, talent allocation needs to be addressed. Typical skills necessary for staffing such center include the following:

a. Basic medical imaging knowledge: Knowing if the quality of the images acquired is adequate for 3D printing is crucial. This will require staff to understand the imaging protocol and why certain images cannot be used for printing

b. Good CAD/3D software understanding: Training staff to use basic (and sometimes open-source) 3D printing processing software is time-consuming. Familiarity with 3D visualization software will make the learning curve much lower.

c. Understanding of 3D printing hardware: Basic maintenance is often required when working with 3D printers. Although an engineering degree is not necessary since most commercial printers are fairly user-friendly, understanding the basic mechanics is necessary for troubleshooting.

d. Basic medical knowledge: Having a basic understanding of the clinical case is important to produce high-quality prints, with more attention to clinically relevant aspects of the case. This should also lead to better quality control of the final product.

Within the medical community, radiologists and radiological technicians are currently equipped with these professional characteristics and have the lowest barrier to entry to staff a 3D printing center. Due to the high cost of hiring a dedicated physician, the best choice to staff these centers is a highly trained and experienced radiological technician who is well versed in 3D software.

Many larger imaging centers have dedicated imaging post-processing labs (“3D labs”), where the technologist’s main role is to use various visualization tools to create 3D images for various clinical purposes. These staff members are ideal for future 3D printing centers because of their experience with existing post-processing software. If the volume for 3D printed models does not reach a level where a full-time technologist is needed, many of the same staff members can also be productive in other areas of the department.

Idea to Implementation: Clinical Trials For 3D Printing Applications

The post Idea to Implementation: Talent Allocation in 3D Printing for Pre-surgical Applications appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA
(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

Depending on existing infrastructure, creating an in-house center can be very expensive and require hard-to-find expertise. Often, it is not a viable initial option for smaller medical centers. Except for imaging acquisition, outsourcing is an option along each of the remaining six steps of the 3D printing workflow. Outsourcing these steps allows the medical center to bypass the initial cost/risk and associated operational challenges of creating an in-house service. Currently, several established companies like 3D System(NC, USA) and Materialise (Belgium) provide such services beyond their core businesses, including services on DICOM conversion, segmentation, and printing all-in-one services. The cost of these services can often amount to thousands of dollars. Although the absolute dollar value appears high for such services, in high-risk, rare, and complex surgical cases, the relative cost of adding a 3D printing step is actually tolerable to most healthcare providers.

However, on the other end of the spectrum a larger academic center may be prepared to heavily invest in creating a centralized 3D printing center. The Mayo Clinic was one of the first medical centers to demonstrate its investment (51) It has made significant strides in exploring the innovative use of the technology, creating quality standards, and generating global influence in this field. Almost all the surgical departments, from pediatrics, neurosurgery, to orthopedics, are now routinely using their 3D printing service. The widespread acceptance of the technology within the Mayo Clinic has significantly increased the case volume and helped to justify the cost. It is now one of a few go-to institutions for educating clinicians and 3D printing industries about medical 3D printing, which acts as additional revenue stream.

Providers should consider the following questions when making the decision on creating an in-house 3D printing service versus using outside vendors:

What is the existing infrastructure that could be used for 3D printing?

Existing personnel and software may be available to be part of the new service. For example, several larger hospital systems including Cedar Sinai and the Kaiser Permanente groups have existing funding for innovative projects such as simulation programs that include 3D printing services. Medical centers with comprehensive imaging services are often equipped with high-quality imaging hardware that can generate high-resolution medical images required for 3D printing. Some newer scanners (e.g. GE) are already equipped with existing 3D printing protocols from various popular prosthetics or device companies. Additionally, many imaging and medical centers have purchased licenses for popular 3D visualization software packages such as Vitrea (Vital, USA), which contains many similar post-processing functionalities to other 3D printing specific software. Some of the larger companies like GE and Siemens, are already adding 3D printing functionality into their newest software. Highly-trained technicians who are already familiar with post-acquisition imaging processing already have many of the skills required for 3D printing. The learning curve for these centers will be significantly less steep than a center without experienced personnel in 3D visualization software.

What is the turn around time required for the applications?

Turn around time is a critical factor to consider as many surgical cases are urgent and need to occur in a timely fashion. The medical center needs to identify the slowest point among the production steps and investigate if the most time-consuming step can be performed faster if outsourced. Good and effective communication between the requesting clinicians and the 3D printing team is the most important step to quickly conceptualize the best 3D printing strategy. Because many surgical cases require more timely response, a few major academic hospitals, like Boston Children’s Hospitaland the Mayo Clinic, have officially incorporated 3D printing for surgical planning as part of their Electronic Healthcare Records (EHR). Ineffective initial communication with either in-house or outsourced 3D printing services will prove costly in time and money. The next most time-consuming and labor-intensive step is segmentation and image post-processing. If in-house bioengineering and/or 3D software expertise are already available, then it is much easier to keep this step in-house, since communicating to a multidisciplinary clinical team can be more effective when the engineering step is completed in-house.

On the other hand, some outsource vendors have experienced design/engineering teams who can offer faster printing and shipping/transportation strategies. They may more quickly scale and modify production to shorten turn around time and meet the demand.

What is the equipment needed to achieve the end point?

Software and hardware requirements will highly depend on the goals of the 3D printing center. For example, the resolution and material requirements for creating a pre-surgical educational model for the patients or medical students will be much less than a pre-surgical model intended for a pediatric cardiothoracic surgeon to simulate the intra-operative environment for complex congenital heart disease. Flexible materials which cost significantly more than typically used resins may be needed for pre-surgical models for complex vascular surgery. The size of the model required will also help determine what hardware is needed. For example, a pediatric heart model is small enough to fit inside the popular desktop SLA printer Form 2 (FormLabs , USA) but an actual sized adult pelvis will not fit.

How much does the clinical team want to be involved in the printing process?

In general, when extensive multidisciplinary communication among different clinical and engineering teams is needed, an in-house 3D printing service is intuitively more efficient and convenient for rapid prototyping and correction of errors and defects in the model. The cost and time of re-designing and reproducing a model will increase significantly with outsourcing.

Again, the steps where clinical team involvement can occur are variable depending on individual cases. For example, in complex maxillofacial cases where the surgeons often want to see a variety of surgical strategies, it may make sense to keep the design/segmentation steps in-house and outsource the final printing with an outside vendor. Models intended for educating patients (patients’ families) and students/residents usually do not require extensive in-house multidisciplinary discussion and can be outsourced easily.

What to look for when selecting for an outsource vendor for pre-surgical 3D printing:

Given the promise of the healthcare market, more and more 3D printing companies are now interested in providing services to healthcare providers. Because of isolation from the healthcare facility, it is important for outsource vendors to understand and respect the sensitive nature of the medical record. It is imperative to prepare a HIPAA compliant data transfer process. Currently, some hospitals use LifeImage (MA, USA) as a way to transfer images. For complex cases, the ability to effectively communicate with the radiologist and treating clinicians requires the vendor to have certain healthcare familiarity or clinical experience. Even with experienced vendors, occasional unsatisfactory products may still be produced and it is important that the vendors can provide adequate customer service to either effectively rectify the mistakes or design backup plans in case of such failure. For example, making multiple versions of the prints with different design or structural emphasis is one such strategy.

Table V summarizes the pros and cons for in-house and outsourced solutions. Many facilities will start with a combination of in-house and outsource services. Depending on the clinical needs, medical centers now have many choices in combining the two services to achieve optimal results. There is also a new growing trend of collaborative works between specialized 3D printing companies with large healthcare systems. (53)

Table V. In House vs. Outsourcing: Pros and Cons

https://3dheals.com/idea-to-implementation-talent-allocation-in-3d-printing-for-pre-surgical-applications/

The post Idea to Implementation: In House vs. Outsourced 3D Printing for Surgical Applications appeared first on 3DHeals.

Hui Jenny Chen, MD and Michelle Gabriel, MS, MBA
(This blog is adapted from our A Roadmap from Idea to Implementation: 3D Printing for Pre-Surgical Application: Operational Management for 3D Printing in Surgery)

There are many active discussions in professional societies and across legal forums, but current regulatory, policy, and legal guidelines are very incomplete or non-existent for medical applications of 3D printing, ranging from medical device manufacture to pre-surgical applications. As more healthcare providers and legal experts are getting involved in the field, the final details on regulatory and legal issues for the production process will slowly but surely unfold. In fact, several major law firms are now leading the way in establishing a subspecialty related to medical 3D printing as can be seen in several recent publications. [45,46]

Because 3D printing pre-surgical applications are very new, healthcare and service providers can only speculate on potential regulatory and legal issues based on similar scenarios with applications of other new technologies. Therefore, it is foreseeable that regulatory issues may need to be carefully considered every step along the way, from design to production. For example, in the medical imaging post-processing (for example, segmentation and DICOM to STL conversion), there is currently no established software standard. Although a few popular software systems such as Mimics (Materialise, Belgium) and Osirix (Pixmeo, Switzerland) are FDA-approved, it is still debatable if FDA-approved software must be used. Many current users default to FDA-approved software, fearing pending regulatory ruling that could make their new workflow obsolete, but in reality, there is no evidence that using non-FDA-approved software would necessarily produce lower quality products. It is also unclear how extensively the FDA should be involved in software development intended for pre-surgical 3D printing applications. For example, although it is commonly accepted that FDA approval is needed when software is used for diagnostic and treatment purposes, multiple software selections are often involved in the process. Some argue that the CAD component of the workflow need not be FDA-approved, but others will argue that every single design step will ultimately affect the quality of the final printout. Very recently, during the draft of this book, Food and Drug Administration published a new draft laying out a framework to discuss developing more specific guidelines for the industry, signifying the importance of staying up to date on the regulatory rules related to this new technology. [59]

Additionally, the associated ownership, patent, and liability issues associated with digital design are also increasingly gaining attention. [46, 54] The intensity of the debate on whether a 3D digital file can be patented was demonstrated in a recent case involving Align Technology Inc. (California, U.S.A.) and ClearCorrect (Texas, U.S.A.). [54] As another hypothetical example, if a color-coded congenital heart model is proven effective in pre-surgical planning for pediatric congenital heart disease, should and can the color-coding process be patented? Also, if there is an unexpected corruption of 3D Printing digital file for an implant which subsequently causes harm in patients, who should be liable for the mistake and to what degree? Similar questions need to soon be addressed by lawmakers and the legal community.

In the manufacturing process itself, safety guidelines for managing 3D printing material, operating 3D printers, and post-print processing must be followed to OSHA standards. We will cover material management in a different post. For patient care, more stringent requirements need to be met as the 3D printed product is used in close proximity and sometimes direct contact with the patient. Currently, only a handful of materials are FDA-approved and can be sterilized sufficiently to be within the operating field. An even smaller number of materials can be used for implant production. [47]Full understanding of the toxicity and biocompatibility of the 3D printing material used will be critical in compliance with future regulations in pre-surgical applications.

Regulatory concerns have significantly increased the complexity of many 3D printing applications. A 3D printed surgical guide is one such example. A Patient Specific Instrument (PSI), or 3D printed surgical guide can be produced on an in-house 3D printing center within 24 hours. However, due to regulatory concerns, many healthcare providers choose to use outside medical device vendors with regulatory approval. This significantly increases the turn around time to up to weeks, markedly decreasing the appeal of using a patient-specific instrument (PSI).

Idea to Implementation: Organization and Staffing of A Multidisciplinary 3D Printing Team

The post Idea to Implementation: Knowing the Unknown — Regulatory and Legal Issues Related to Pre-surgical Applications Using 3D Printing appeared first on 3DHeals.