The Medical Device Developer's Dilemma: Where to Spend Your First Development Dollars

Medical device development follows a well-established path from concept to commercialization, but the early stages often present a classic "chicken or the egg" dilemma. With limited initial funding, where should you spend those critical first dollars to maximize your chances of success?

Before diving into development strategies, one fundamental principle must guide every decision: ensure you're solving a problem that buyers will pay to solve. Novel technology, better performance, or cost reduction alone won't guarantee market success. This market validation should inform every subsequent development decision.

The Intuitive Approach: Prototype First

Most medical device innovators instinctively focus on developing prototypes or proof-of-concept demonstrations as their first step. This approach makes perfect sense when the core technology is genuinely novel and the mechanism of action remains unproven.

Consider developing a truly non-invasive continuous glucose monitor—a skin patch that measures glucose levels without any subcutaneous components or finger pricks. Here, proving that your sensing approach can reliably correlate skin-surface measurements with actual blood glucose levels is absolutely critical—without demonstrating this fundamental detection capability, no amount of downstream development matters.

When Prototyping First May Backfire

However, this prototype-first approach can be counterproductive when dealing with known technologies applied in new ways. Let's examine a concrete example:

The Pulse Oximetry Challenge: Current pulse oximeters are less accurate for people with darker skin tones due to melanin's interference with light absorption. Suppose you've developed an algorithmic solution that automatically detects and adjusts for different skin tones using the same hardware approach (660nm and 940nm light wavelengths) that's been used for decades.

The technology is proven. Your innovation lies in the software algorithm, not the underlying physics. So why not just build the algorithm and test it?

The Hidden Regulatory Trap

Here's where many developers get blindsided: rushing to prototype without understanding regulatory requirements often leads to expensive redesigns later.

In our pulse oximetry example, multiple FDA product codes could apply depending on your specific approach:

• DQA (Oximeter) - the primary classification with established consensus standards

• JOM (Software as Medical Device) - if your algorithm qualifies as standalone software

• DPZ (Physiologic Patient Monitor) - if integrated into monitoring systems

  
  

Each classification brings different performance requirements, testing protocols, and approval pathways. Some standards are critical to incorporate from day one of prototype development, while others can be addressed later. The key is knowing which is which before you start building.

A Strategic Alternative: Regulatory Assessment First

For known technologies with established mechanisms of action, conducting a comprehensive regulatory assessment before prototyping can dramatically improve your return on initial investment.

What does a regulatory assessment include?

• Identification of applicable FDA product codes and classification pathways

• Analysis of relevant consensus standards (ISO, IEC, ASTM)

• Review of FDA guidance documents and recent regulatory decisions

• Mapping of required performance testing and clinical evidence

• Timeline and cost estimation for regulatory submission

  
  

This upfront investment can save multiples of its cost in avoided redesigns and failed prototypes.

Choosing Your Development Sequence

The optimal sequence depends on your specific situation:

Scenario	Recommended First Step	Rationale
Novel Technology/ Unknown Mechanism	Proof of Concept	Must validate fundamental viability before investing on downstream artifacts
Known Technology/ New Application	Regulatory Assessment	Optimize prototype design by understanding requirements upfront
Usability Enhancement	Competitive Analysis + User Research	Understand current market gaps and user needs before technical development

Making the Right Choice

The key is honestly assessing which uncertainty poses the greatest threat to your project's success. Ask yourself:

• If the technology doesn't work as theorized, does everything else become irrelevant?

• If regulatory requirements are more complex than expected, will it force major redesigns?

• If users won't adopt the device, does technical excellence matter?

• If the market isn't ready to pay, is the entire premise flawed?

  
  

Your first development dollars should target your highest-risk assumption. For many medical device innovations using established technologies, regulatory assessment provides the best initial return on investment. But not always.

The goal isn't to follow a standard sequence—it's to ensure your first investment moves you efficiently toward proof that your device can succeed in the real world.