Considering the impacts of industry strategics

As many of us reading TMD either work for a major industry strategic or a company selling to one or competing with one, it’s easy to comprehend these goliaths have an impact on all of us. Here are the top 6 that we identified:

Most of these companies tend to be in the top 3 market share in the segments they participate in. As market leaders, these businesses focus on commercial execution and set the bar for pricing, clinical evidence, and reimbursements in their product categories. Smaller players can benefit by observing their moves and being more nimble and focused – especially when it comes to innovation. Watching how the market leader behaves can influence us in a specific market segment.

During the past 20 years, large healthcare companies (such as GE, MDT, Philips) have driven the industry to focus on their core competencies and then outsource the rest. This has led to a boon for medtech contract manufacturers, many of these big strategics are your customers. And as your customer, they’re very demanding – which usually makes us better (individually and collectively).

If you compete with one of these giants, they’ll definitely challenge you to make you better. Your agility and ability to innovate will be your competitive advantage.

Industry strategics are often the most active when it comes to M&A. They’re seeking acquisitions to (1) increase marketshare; or (2) improve their technology portfolio. Through these activities, they create value and opportunity for smaller players who innovate.

With a large portfolio of products, some of these large companies also become suppliers to the industry through re-selling some of their core products to small and big companies. B.Braun, Teleflex, MDT, and Cardinal are good examples of organizations with their own original equipment manufacturer (OEM) sales groups.

Industry strategics are risk averse when it comes to innovation and development. These market leaders are aggressive when it comes to commercial execution. If it means partnering with a smaller company that’s de-risked the innovation, that’s ok for them. It can create win-win scenarios for companies both big and small.

In summary, even though we may not always like some of these huge companies in our industry, they serve an important purpose in our medtech ecosystem. As you consider their impacts, think about the best ways you can take advantage of their presence in your markets.

ABOUT THE AUTHORS: CCEO Florence Joffroy-Black is a long-time MedTech M&A and marketing expert. She can be reached at florencejblack@medworldadvisors.com. Managing Director Dave Sheppard is a former medical OEM Fortune 500 executive and an experienced MedTech M&A professional. He can be reached at davesheppard@medworldadvisors.com. “Value = Strategic Fit + Timing® is a registered trademark of MedWorld Advisors.