A proven approach to medical device software development: How to build a feasible software prototype, test it, and successfully launch your product

The medical software industry is rapidly growing, with the estimated market size increasing from $19 billion in 2022 to $167.59 billion by 2032. Such expansion prompts manufacturers to invest resources in medical device software developers and build the product that can attract more customers and unlock new revenue streams.
However, creating medical software is usually not simple: it requires special attention to industry-specific details, such as regulations and strict requirements for sensitive medical data traffic, and typically involves a longer development lifecycle compared to device-independent solution development.
Yalantis experts have collaborated to create the guide to developing feasible healthcare solutions that will help companies accurately estimate the necessary resources and understand all intricacies hidden beneath the surface.
We will:

• you through the process of developing medical device software and its distinctive features
• show you the ways to address main software development challenges
• give you some extra tips on choosing a reliable medical software development vendor

Medical device development focuses on the design, engineering, and maintenance of software that is intended to be part of or used with medical devices. It differs from other types of software development in several key ways:

I. Strict regulatory compliance

Medical device software is subject to strict regulations to ensure the safety, effectiveness, and quality of devices that have a direct impact on patient health. Different regional markets have their own mandatory regulations, each designed to protect end-users and ensure consistency in medical device safety:

• UNITED STATES: Food and Drug Administration (FDA). Medical device manufacturers should operate according to certain FDA regulation codes, such as FDA 21 CFR part 820 and FDA 21 CFR part 11. Additionally, there’s the FDA Guidance on software as a medical device (SaMD), which covers the development of software products intended to be used for medical purposes without being part of a hardware device.
• EUROPEAN UNION: Medical Device Regulation (MDR). Aside from complying with EU MDR (2017/745) that governs the development of all medical devices in the EU, companies should adhere to IEC 62304 and ISO 13485 standards that specify requirements for a quality management system for medical devices.
• CANADA: Canadian Medical Device Regulations (CMDR). Additionally, manufacturers must comply with ISO 13485 standard and undergo licensing through the Medical Devices Bureau. Similar to the EU, Health Canada also recognizes IEC 62304 for the lifecycle management of medical device software.
• JAPAN: Pharmaceuticals and Medical Devices Agency (PMDA). PMDA regulates the safety and effectiveness of medical devices in Japan, including software. Moreover, devices, including software, must be classified under the Japanese Medical Device Nomenclature (JMDN) system to determine their regulatory pathway.
• AUSTRALIA: Therapeutic Goods Administration (TGA). TGA regulates medical devices and medical device programming development in Australia. Additionally, manufacturers must register their devices on the Australian Register of Therapeutic Goods (ARTG) and comply with international standards like ISO 13485 and IEC 62304.
• CHINA: National Medical Products Administration (NMPA). NMPA regulates medical devices and software in China, requiring adherence to domestic standards similar to IEC 62304 for software development. Device classification and registration are mandatory.

WHY IMPORTANT: If custom medical device software isn’t compliant with the applicable regulatory standards, the consequences can be significant and potentially damaging to both the business and the end-users, and may include:

• regulatory rejection and product launch delays
• product recalls issues by regulatory authorities or manufacturers
• legal and financial penalties on software development companies
• insurance and liability claims from patients

II. Risk management throughout product development lifecycle

Risk management in medical software engineering involves systematically identifying, analyzing, and mitigating potential risks that could affect patient safety or device functionality.

This process is governed by international standards such as ISO 14971, which outlines the framework for identifying hazards, estimating the associated risks, and controlling them through various measures.

Key elements of an effective risks management strategy include:

• creating a risks management plan
• performing failure mode and effects analysis (FMEA)
• continuous monitoring throughout the product lifecycle

WHY IMPORTANT: Unlike other software sectors, the focus here is on safeguarding human life, meaning the stakes are significantly higher, and even minor software errors could lead to critical failures.

III. Extended software validation process

Validation is a critical aspect of medical devices software development that ensures the software meets its intended purpose and functions correctly under expected conditions. Validation includes:

• testing the software through various methodologies such as unit testing, integration testing, and system testing
• validation against user requirements and regulatory standards.

Importantly, validation is not a one-time process — it continues throughout the development lifecycle and even into post-market surveillance.

WHY IMPORTANT: The software validation process ensures the software performs safely and reliably, reducing the risk of malfunctions that could harm patients. It also guarantees compliance with regulatory standards, improves software quality, and protects sensitive patient data.

IV. Maintaining traceability at every stage

Traceability ensures that each phase of medical software development, from design to deployment, is fully documented and verifiable. This process involves:

• creating clear links between user requirements, design inputs, development outputs, and validation activities
• maintaining detailed traceability matrices that confirm that all regulatory, functional, and safety requirements have been met

WHY IMPORTANT: Regulatory bodies often require proof of traceability during audits or inspections, that’s why it’s essential to build a transparent workflow around maintaining it. Effective traceability reduces the risk of errors and makes it easier to manage changes throughout the product lifecycle.

V. Detailed usability requirements

Custom medical device software must be designed with a focus on extended usability requirements, ensuring it’s not only functional but also user-friendly and intuitive. These requirements often take into account the diverse range of users, including healthcare professionals, technicians, and even patients, each with different levels of technical expertise. In this context, partnering with a data engineering service provider can help optimize data flow and analysis, ensuring the software is both efficient and easy to use, ultimately improving the overall user experience.

WHY IMPORTANT: Usability testing, often mandated by standards like IEC 62366, plays a critical role in the design process. The software needs to be accessible, reduce the likelihood of user errors, and work effectively in high-stress environments like hospitals or emergency care.

VI. Focus on security and privacy

Establishing security practices early in the medical device software development life cycle is essential due to the sensitive nature of healthcare data (data life cycle management). The software must be developed in accordance with standards such as ISO/IEC 27001 for information security management and must also comply with healthcare-specific regulations like the Health Insurance Portability and Accountability Act (HIPAA) in the U.S.

WHY IMPORTANT: Since medical devices often handle personal health information, ensuring data security prevents identity theft, fraud, and potential harm to patients. Moreover, compliance with regulations like HIPAA and GDPR is mandatory, and failure to prioritize security and privacy can lead to severe legal and financial consequences, as well as damage to a company’s reputation.
Aside from including various practices into the product development lifecycle, medical device software can be enriched with tools to make data delivery, analysis, and usage more comfortable and insightful for healthcare providers. Below, you will find some examples of these tools.

Even though medical device software development services are complex and encompass a lot of processes, investing time and resources in them is worth a try. If done right, it gives your business numerous advantages among the competitors:

• ENHANCED MARKET COMPETITIVENESS. Custom medical device software allows businesses to offer advanced features that set them apart from competitors, such as AI-driven diagnostics or real-time data analysis, which provide unique solutions in the market.
• REGULATORY COMPLIANCE AND RISK MANAGEMENT. Ensuring that software meets regulatory standards (e.g., FDA, ISO, IEC) reduces the risk of legal issues, product recalls, and market entry delays. Along with that, comprehensive software testing and validation reduce the likelihood of device malfunctions or software failures, minimizing the risk of lawsuits or patient harm.
• IMPROVED OPERATIONAL EFFICIENCY. Custom software enables businesses to streamline operations, from automating repetitive tasks, such as device calibration or monitoring, to data flow optimization and post-release support.
• SCALABILITY AND FLEXIBILITY. Software that is designed with scalability in mind, allowing businesses to expand into new markets or incorporate new technologies with minimal disruption. This enables healthcare businesses to adapt quickly to changing market demands, regulatory updates, or customer preferences.
• FASTER TIME TO MARKET. Efficiently developed medical device software helps businesses reduce the time spent in iterative development and testing phases. Plus, software designed to meet industry standards right from the start reduces delays related to regulatory approval.
• COST SAVINGS. Well-designed software with fewer bugs and better documentation reduces future maintenance and support costs.
• BETTER CUSTOMER SATISFACTION AND RETENTION. High-performing medical device software enhances the user experience for both healthcare professionals and patients, leading to increased customer satisfaction and loyalty.
• MONETIZATION OPPORTUNITIES. Companies can generate new revenue streams through software-as-a-service (SaaS) models, licensing, or selling software updates and enhancements. Businesses can offer premium software features, such as advanced analytics or remote monitoring, at additional costs.
• IMPROVED BRAND REPUTATION AND TRUST. By delivering reliable software that meets the needs of users, businesses can forge long-lasting partnerships with clients, healthcare institutions, and distributors. A reputation for high-quality, compliant software fosters trust and strengthens brand image.

However, there is also a specific set of challenges when it comes to medical device software design. Those challenges are mainly connected to the stringent regulatory requirements, high-stakes user environments, and the need for robust security. Below, you’ll see how Yalantis team addresses these challenges if they arise to make the development process as smooth as possible.

Regulatory compliance complexity

One of the biggest challenges in medical device software development is adhering to the complex and evolving regulatory landscape. Compliance with standards like ISO 13485, IEC 62304, and FDA 21 CFR Part 820 can be overwhelming, especially for companies unfamiliar with these processes.

YALANTIS’ TIPS TO ADDRESS THIS CHALLENGE:

• Integrate compliance early in the development process by following a structured framework that aligns with these regulations.
• Maintain thorough documentation for each sprint.
• Conduct rigorous product testing to ensure that it meets compliance requirements.
• Work closely with regulatory experts to ensure that your software meets all the necessary requirements without slowing down the development timeline.

Risk management and patient safety issues

Software development for the healthcare sector focuses around patient data safety. It’s a high stakes environment, where even minor software errors can lead to things like wrong medication dosages, health complications, or even death. That’s why implementing comprehensive risks management strategies is critical for medical device manufacturers.

YALANTIS’ TIPS TO ADDRESS THIS CHALLENGE:

• Perform detailed risk assessments using methodologies like Failure Mode and Effects Analysis (FMEA) throughout the software lifecycle.
• Continuously identify, assess, and mitigate potential risks, ensuring that safety is built into every stage of development.

Usability and user experience

Medical device software is often used by healthcare professionals or patients who may not have extensive technical expertise. Ensuring the software is user-friendly and intuitive is a challenge.

YALANTIS’ TIPS TO ADDRESS THIS CHALLENGE:

• Include thorough usability testing in software development process.
• Design interfaces for medical professionals that minimize the risk of user error and work seamlessly in high-stress environments like hospitals.
• Adhere to the IEC 62366 usability standard, which guides the design of user-centered medical devices and ensures they are easy to operate.

Security and data privacy challenges

Medical devices often handle sensitive patient data, making security and privacy top priorities. Cybersecurity threats, such as data breaches and unauthorized access, are ongoing challenges in connected medical devices.

YALANTIS’ TIPS TO ADDRESS THIS CHALLENGE:

• Employ advanced encryption techniques for hardware medical device
• Implement secure data transmission protocols and continuous vulnerability testing to protect sensitive information.
• Ensure compliance with data protection regulations like HIPAA and GDPR, so your software is not only functional but secure.

By addressing these challenges head-on, Yalantis development team ensures that your embedded medical software is safe, compliant, and user-friendly, enabling you to focus on innovation while we handle the complexities of development (embedded software development).

Now, let’s talk about one of the main deal breakers for software development: its cost.

Understanding the things that influence the cost of software development services can help you budget effectively and make informed decisions. Here are the key elements that factor into the final cost of medical software development:

• Device complexity. The more complex the medical device and its associated software development process, the higher the development cost. Devices that require advanced functionality, such as embedded systems, real-time data processing, or integration with other devices and systems, will need more development time and specialized expertise, which increases the final price.
• Regulatory and compliance requirements. Adhering to strict regulatory standards such as FDA, CE, or ISO significantly impacts the development process. Ensuring compliance involves detailed documentation, frequent audits, and exhaustive testing, all of which add to the overall cost. Companies must also account for region-specific regulations, which may require additional customization and certifications, increasing both the development timeline and price.
• Development team experience. The skill level and experience of the medical device software developers team play a critical role in pricing. Highly specialized engineers, especially those familiar with healthcare standards and medical device software, often command higher rates.
• Testing and validation processes. Comprehensive testing is essential for embedded medical systems, covering functionality, usability, security, and compliance. Validation processes like unit testing, system testing, and field testing all contribute to the final cost. Additionally, post-market monitoring and updates to ensure the software continues to meet regulatory standards can also increase long-term costs.
• Maintenance and support. Ongoing maintenance, updates, and technical support are crucial for medical device software to remain compliant and operational. Factoring in long-term support costs ensures your software stays up to date with security protocols, regulatory changes, and user needs.
• Building from scratch or choosing a vendor. These two approaches are significantly different in terms of cost. A vendor might have a ready-made solution that can be adjusted to your needs, but won’t be able to meet every criteria. A software development team can build a solution specifically for your business, but it might be costly.

Below, we’ll expand more on how to choose a software development vendor for optimal results.

Medical software development process covers a huge variety of projects, from building embedded systems for life-saving devices to creating healthcare apps and AI-assisted health data analytics platforms.

This means that medical device software lies at the intersection of different domains, such as Internet of Things (IoT), artificial intelligence (AI), and machine learning (ML) algorithms, that are used to augment the final product with specific functionality, make it scalable, and personalized to your customer needs.

At Yalantis, we have experience building customized medical solutions for middle-sized hospitals and big healthcare enterprises. Here’s only a glimpse of what you can expect from our team:

• Custom healthcare solution development. Our healthcare solution development services focus on creating software that powers medical systems, including electronic health record (EHR) systems, telemedicine platforms, and patient management software. Additionally, we can integrate these custom solutions into your hospital legacy systems with minimal disruptions.
• Medical device development. We specialize in medical device software development, ensuring your device complies with global regulatory standards like FDA and CE while delivering reliable, safe, and efficient performance. Our team designs, builds, and maintains software for various healthcare devices, helping your business speed up time to market and ensure you’ll stand out among the competitors.
• Firmware development. Firmware development is essential for the proper functioning of medical devices, as it controls hardware components like sensors and communication modules. Yalantis specialists can develop and optimize firmware to ensure that it performs seamlessly within your IT infrastructure and can scale as your business grows (firmware development company).
• Remote patient monitoring (RPM) module development and integration. We build and integrate custom RPM solutions, enabling healthcare providers to track patient health in real time. This service allows businesses to offer innovative care models that improve patient outcomes while reducing hospital readmissions and associated costs.
• IoT data collection, management, and analysis. Healthcare providers collect and analyze data from numerous medical devices to get insights on patients’ health and promptly manage their conditions. Services such as remote IoT device management and cloud computing could help to make the process of data management faster and more efficient.
• AI and ML Implementation for predictive health analytics. We implement AI and ML algorithms to enable predictive health analytics, helping healthcare providers forecast potential issues and take preventive measures. This service enhances businesses’ ability to offer proactive healthcare solutions, ultimately improving patient care and optimizing resource management. Predictive analytics can significantly reduce healthcare costs and improve patient outcomes. By utilizing ml model development services, businesses can create precise and tailored models that address specific healthcare challenges effectively.

Selecting the right vendor for medical device software design is a critical decision that can affect the success of your product. Here are the key factors to consider when choosing a vendor for medical device software development:

• Regulatory expertise. Ensure the vendor has a proven track record of working with regulatory standards like ISO 13485, IEC 62304, and FDA guidelines. Vendors with experience in navigating these complex regulations can help ensure that your software complies with all necessary requirements.
• Experience in medical device development. Look for vendors with specific experience in medical device software development. A vendor with a portfolio of successfully developed medical devices will be better equipped to understand the intricacies of patient safety, risk management, and the healthcare environment.
• Quality assurance (QA) capabilities. Medical device software must undergo rigorous testing, including functionality, performance, and usability assessments. Make sure the vendor has experience with validation processes and can ensure the software meets high safety and performance standards.
• Cybersecurity and data privacy expertise. Given the sensitive nature of healthcare data, cybersecurity is essential. The vendor should have a clear strategy for safeguarding data, from encryption to secure communication protocols, and a history of complying with data protection regulations like HIPAA and GDPR
• Post-market support and maintenance. Medical device software requires ongoing maintenance to stay compliant with regulatory updates and evolving cybersecurity threats. Select a vendor that offers post-launch support and can provide regular updates and security patches.

Why partner with Yalantis on medical device software development?

With experience building custom medical solutions, from medical imaging software to e-prescription systems, custom EHR, and digital health platforms, Yalantis’ experts can create tailored and feature-rich medical device software and tick all the boxes off your product requirements list. By partnering with us, you’ll get the following benefits:

• Embedded compliance and security practices. Protection of sensitive data starts at the device prototyping stage and continues well into post-deployment activities with the regular security patches and firmware updates, and penetration tests.
• Risk mitigation and management. Yalantis cybersecurity experts perform regular vulnerability tests and attack simulations to identify weak areas in the software security and eliminate them.
• Cost management. We’re experts in developing cost-efficient medical solutions due to reuse of our expertise and using our proprietary code which already has embedded security tools. This speeds up the development process and allows your product launch earlier, while maintaining all the core functionality intact.