SANTA CLARA, Calif. – It has never been easy to get payers to reimburse in a timely and adequate fashion for novel diagnostics, making it notoriously difficult to build a business from them. But a few high-flying diagnostics companies, such as Madison, Wis.-based Exact Sciences Corp. and Redwood City, Calif.-based Guardant Health Inc., have been blazing the trail recently on how to rapidly scale up to become valuable commercial entities from origins as a research-based startup.

Med-tech companies brought in more money than each of the last two years in every type of financing, aside from private placements, with about 11% of the funds flowing into digital health companies. In total, the industry raised $40.67 billion, an increase of 98% over 2018, which logged $20.6 billion and was more in line with the $19.4 billion raised in 2017.

Will the digital transformation in health care start to benefit consumers in 2020? That was one of the challenges addressed in a recent report from PwC Health Research Institute titled “Top health industry issues of 2020: Will digital start to show an ROI?” The report predicts that in the next year, health system leaders will tout their investments in technology and transformation.

Wells Fargo Securities LLC recently published The MedTech Manual – 2020 Outlook, in which it says the medical device sector “will continue to be a port in the storm because the political focus will remain on drug pricing and increasing access to [health care].” Overall, the industry has performed quite well in comparison with other health care sectors during 2019. The financial firm’s senior analyst Larry Biegelsen and colleagues wrote that they expect the medical device sector to continue moving in a positive direction despite Medicare for All (MFA) rhetoric and an upcoming presidential election.

A total of 18 med-tech companies that have gone public on U.S. exchanges this year are showing a positive percentage change in stock value on average of 43%, despite large price drops for Personalis Inc. and Guardion Health Sciences Inc.

Medtronic plc, of Dublin, reported good news in terms of its quarterly results Tuesday, with key revenue segments coming in line with or beating expectations. Wells Fargo's Larry Biegelsen noted that coronary and structural heart sales of $955 million exceeded the consensus of $949 million and his organization's $923 million estimate. The company pointed to its transcatheter aortic valves as helping in the boost, following the expansion into the low-risk patient population.

Axonics Modulation Technologies Inc., of Irvine, Calif., reported revenue of $1.3 million for the third quarter of 2019, up from $0.2 million in the same period last year, but below Wall Street's forecast of $1.4 million. CEO Raymond Cohen attributed the miss to a seasonal slowdown in implants of Axonics' rechargeable sacral neuromodulation (r-SNM) system in international markets, as well as some U.S. physicians who were waiting for the device to win urinary approval. That milestone came Thursday when the U.S. FDA approved Axonics' r-SNM for the treatment of overactive bladder (OAB) and urinary retention. The indication for urinary retention represents the largest segment of the market for SNM devices and comes just two months after FDA approved the r-SNM to help patients with fecal incontinence. (See BioWorld MedTech, Sept. 10, 2019.)