ARTICLE SUMMARY:
Start-ups can no longer postpone developing a reimbursement path and hope an eventual acquirer takes on that responsibility. LimFlow is an example of how a company prioritized reimbursement from the outset in developing its pioneering peripheral vascular technology and is now reaping the benefits of that approach.
It wasn’t that long ago that reimbursement was relatively low on the priority list of medtech start-up CEOs. The most common reason for that given by senior executives was that reimbursement was too complex for a start-up to take on and, anyway, that was something better suited for a strategic to handle following an eventual acquisition.
However, things have clearly changed. Strategics and most other potential acquirers now expect start-ups to have at least a mapped out general reimbursement pathway, if not an incorporated full-blown strategy. Even venture capitalists and other investors now expect potential portfolio companies to have a clear idea of how their products are going to be paid for before being considered for an investment.
As a result, start-ups are increasingly adding reimbursement to their list of early strategic priorities. In the process, they often find out another reason why it is beneficial to start early in developing a payment strategy: gaining reimbursement is a complex process with its three separate components of coding, coverage, and payment, each of which requires a different process and with that, different expertise. Oh and by the way, successfully navigating the reimbursement minefield takes a long time—another good reason to get an early start.
LimFlow is an example of a company that took those considerations to heart nearly from the outset of the peripheral vascular firm’s founding and has made reimbursement a priority ever since, a strategy that according to CEO Dan Rose has paid dividends as the firm has grown. Launching a reimbursement strategy for an early-stage company is a lot like charting a course when you know the final target destination, but don’t have a map to set the route to get there.
