- The U.S. Surgeon General this weekend echoed recommendations from the American College of Surgeons advising hospitals to consider canceling elective surgical procedures while addressing the novel coronavirus pandemic.
- The surgeons' group additionally encouraged providers to move elective inpatient diagnostic and surgical procedures to outpatient settings "when feasible," and urged an immediate decrease in use of essential equipment and supplies that may need to be funneled to COVID-19 care, including ICU beds, personal protective equipment, terminal cleaning supplies, and ventilators.
- Separately, a survey of more than 60 orthopaedic surgeons, interventional cardiologists and anesthesiologists published last week by investment firm Jefferies suggested U.S. cancellations and delays were already on the rise. That came before the World Health Organization declared the outbreak a pandemic.
In reporting quarterly results earlier this year, several medtechs acknowledged some manufacturing or supply chain vulnerabilities in China, as well as potential revenue hits from postponed or canceled surgeries in the region. The scope of impact from lost procedures is now much wider, as the U.S. finds itself in the throes of the COVID-19 pandemic.
"Each hospital, health system, and surgeon should thoughtfully review all scheduled elective procedures with a plan to minimize, postpone, or cancel electively scheduled operations, endoscopies, or other invasive procedures until we have passed the predicted inflection point in the exposure graph and can be confident that our health care infrastructure can support a potentially rapid and overwhelming uptick in critical patient care needs," ACS wrote Friday.
That inflection point could be months down the line. Revenues should theoretically be realized in the long term, but that doesn't mean medtech companies won't feel the pinch, analysts at Jefferies said in a note to investors late Sunday.
"While most cases are likely to be shifted out as opposed to canceled out right, a concern for device companies is their ability to withstand a protracted turn down from a cash perspective," the analysts wrote.
A joint letter Sunday from the American Hospital Association and related organizations urged the Surgeon General Jerome Adams to clarify guidance on elective procedures, painting a tricky cost-benefit picture as hospitals face a down-period for the lucrative procedures.
"It is imperative to note that 'elective' simply means a procedure is scheduled rather than a response to an emergency. For example, 'elective' surgeries could include replacement of a faulty heart valve, removal of a serious cancerous tumor, or a pediatric hernia repair," AHA wrote.
"Often, if these types of procedures are delayed or canceled, the person’s condition gets rapidly worse and can even be life threatening ... The resulting decline in their health could make them more vulnerable to COVID-19."
AdvaMed's Mark Brager, vice president of communications, commented via email Monday that the trade association welcomes the Surgeon General's guidance and is "confident patients and physicians can work together to decide which procedures are necessary and which can wait until this public health emergency has passed.”
The statements follow a Jefferies survey published last week of 62 doctors that found 23% had already noticed an increase in deferrals and cancellations, with more than half of respondents expecting the trend to continue. Cardiologists saw the highest impact at 29%, followed by orthopaedic surgeons at 23% and anesthesiologists at 13%.
According to last week's estimate, the U.S. could see 3% to 4% of procedures impacted across orthopaedics and interventional cardiology.
More broadly, the National Association of Manufacturers last week released a survey of its members, wherein 78% of 558 respondents anticipate negative financial impacts due to COVID-19.
Those findings preceded the World Health Organization officially labeling the disease a pandemic and the administration declaring a national emergency. Some 35.5% reported they were already facing supply chain disruptions, and 53% anticipated changes to operations in the coming months.
Most medtech companies have not issued updated financial guidance since factoring in the situation in China. Radiation oncology tech maker Varian Medical Systems and Conmed are among those that did so last week.
Varian announced March 9 that while orders had not been canceled, it expects revenue to be impacted negatively due to COVID-19 and estimated second quarter earnings to range between $800 million to $825 million, originally projected at $828 million. Meanwhile, Conmed management said March 10 it expects first quarter growth to range between 2% and 4% compared to its previous expectation of between 5% and 6%.