Medical devices in spotlight as driver for

economic growth
By JOHN BROSKY
Medical Device Daily European Editor

DÜSSELDORF, Germany – Lights, cameras and political action!

For the first time in its 40-year history, the world's largest trade fair for medical technologies
found itself at center stage as the German Chancellor, Angela Merkel, arrived for the opening
ceremonies at the massive Düsseldorf Messe.

In her inaugural speech, Merkel moved medical devices into the public eye and forward on
Germany's political agenda ranking the sector alongside automobiles as a leading engine for
exports and job growth.

"Set against the background of its economic significance and demographic developments, it is
important that this sector should be put in focus," Merkel said.

The pack of photographers and reporters following the Chancellor into the exhibition halls for a
tour of Germany companies stirred excitement at an event that is normally the crowded but quiet
province of distributors cutting deals for new products.

Medica 2010 saw a parade of political dignitaries following the path of the German Chancellor,
each equally determined to show the national flag in order to boost exports of medical devices.

Merkel was followed on the second day of the event by Courtney Gregoire, director of the
National Export Initiative (NEI) for the U.S. Department of Commerce, and the third day saw a
visit by the Right Honorable Lord Ara Darzi, MD, the high profile former Under-Secretary for
Britain's National Health Service (NHS).

Germany leads the parade not only because it is the host country for Medica, but more
importantly for the robust growth medtech brings to the nation's economy.

The sector grew by 5.5% in 2010 with 41% of the revenues coming from exports and is creating
more jobs than can be filled by qualified personnel (Medical Device Daily, Nov. 11, 2010).
First steps overseas for Obama's export initiative

A high growth sector with a strong profile for future growth, medical technologies are a priority
for support for the export initiative, Gregoire told Medical Device Daily.

"We have over 420 U.S. companies here at this show, and the U.S. Foreign and Commercial
Service is working directly with 250 of them setting up meetings at Medica," she said.

According to Gregoire, the worldwide market for medtech is $341 billion and American
companies can be leader in several segments for both the manufacturing and innovation.

U.S. exports of medical devices are estimated to be over $36 billion, "and I believe we can do
better," she said.

"This translates into a tremendous potential for creating jobs at home both in research and
development and manufacturing, which is the right combination."

NEI was established following a pledge made by President Barack Obama in his State of the
Union Address to create two million new jobs by doubling exports over the next five years.

Gregoire said she began work in May crisscrossing the country meeting with companies and,
specifically, attending a Medical Device Exporter Seminar in Minneapolis for small and
medium-sized companies sponsored by Medtronic (Minneapolis) and hosted by the Department
of Commerce's International Trade Administration (ITA) and AdvaMed (Washington).

"There were more than 40 suppliers who developed a product, signed a deal with Medtronic, and
then never thought any further about exporting the product themselves," she said.

Gregoire said Medica is her first visit to a foreign trade show.

"After seeing the traffic at this event, the message I am taking back is that Medica is a premier
show U.S. companies need to seriously consider," she said.

There is a tremendous opportunity to test market products, to grow from one market into a
second then a third, she said, adding, "This is a fast track into international markets."

"I met with one U.S. business that has been coming for eight years, that is profitable working in
15 countries, and whose chief executive told me his entire international marketing effort is
Medica," she said. "He gets the biggest bang for the buck in three days here meeting with all his
distributors and buyers."

"I have heard there can be barriers to entering foreign markets, but this is where distributors and
partners like the US Foreign Commercial Service can open doors and help align with local
requirements," Gregoire said.
Where Germany has won share of exports with high-end and high-priced products, and China is
gaining share with low-end products at low prices, Gregoire said the positioning for U.S.
companies will be with high quality and innovative products.

"What I have heard here is there is a recognition that American companies deliver quality
products, which attracts distributors, and the other piece is staying on the cutting edge and
remaining innovative, continually finding the unmet needs and creating the next products to fill
that need," she said.

Quality in healthcare is cheaper

Darzi arrived at Medica 2010 describing himself as an ambassador for healthcare and life
sciences and "proud to be wearing the British hat."

Asked whether he was a buyer or a seller, he replied, "A bit of both, actually."

"We have some 300 companies here for exporting, and I am meeting with them, as well as with
larger companies, such as Panasonic, who represent an inflow as investors interested in
establishing operations in England," he said.

A renowned pioneer minimally invasive and robotic surgery who holds the Hamlyn Chair of
Surgery at Imperial College (London), Darzi led a year-long review of the NHS that resulted in
the report calling for a controversial overhaul of the system (MDD, July 3, 2008).

"Quality needs to be the organizing principle for healthcare, which is the one industry where
quality is cheaper and a lever for reducing expenses," he told MDD. "It is not quality that is
straining healthcare systems today but the large-scale of inefficiencies in those systems."

"When we look at the manufacturing of a diagnostic test see here at Medica with the efficiencies
of moving it through the supply chain, and then if we map out the inefficiencies in a patient
pathway for care where that diagnostic is used, the contrasts are startling," Darzi said. "If we get
that right in healthcare, we will save huge sums of money."

Among the vast displays of products at Medica, Darzi sees the future in Halls Two and Three
dedicated to bio-chemical assays.

"The impact of molecular diagnostics is going to be a complete disrupter and will force a
rethinking of the models of healthcare," he said. "There are tremendous opportunities in
diagnostics for preemptive treatment, more personalized care and greater patient participation
in that care."