EMDT_European Medical Device Technology

European Medical Device Technology, Summer 2015

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emdt.co.uk European Medical Device Technology Summer 2015 | 21 cardiology. Recent examples for innovative research projects are the artificial heart invented by Professor Alain Carpentier of Georges Pompidou European Hospital in Paris and the percutaneous heart valves developed by Professor Alain Cribier of the Charles Nicolle Teaching Hospital in Rouen. Financing: France's Weakest Link Despite their innovative spirit, French com- panies suffer from their modest size: 94% have fewer than 250 employees, including 45% of very small companies with fewer than 20 employees. Because these small companies often find it very difficult to cross the critical threshold for market- ing their innovations, French companies are ultimately easy targets for takeovers by foreign multinationals. According to Alain Ripart, senior vice president of Sorin CRM, "Much valuable public and private aid for innovation exists in France during the start-up phase. But companies cannot surmount their eighth year—a real 'valley of the shadow of death'—when they need to accept a roll-out and marketing effort that consumes a lot of capital." The way venture capital is organised in France means that most funds are limited to less than eight years, which is often too short a timespan to sustain medtech com- panies' capital. According to a 2012 report by the French Strategic Analysis Centre and General Inspectorate of Finance, "there is a shortfall of three to five years of sustained financing for French medtech companies to reach a critical size. This is when they are generating a turnover of 100 million euros, which they need to raise funds from development capital sources." Industrial Recovery Plan in Sight It is no surprise that France's medical device industry, which exports, on average, just 29% of its production, has a balance of trade deficit in excess of two-billion euros, according to the latest figures from the French Directorate-General of Cus- toms and Indirect Taxes. Most French SMEs focus little of their attention on international markets, concentrating their resources instead on meeting the draco- nian clinical assessment requirements for access to the reimbursed market in their own country. Even in France, successful business is no certainty: trapped between reimbursement tariff cuts of 85-million euros a year since 2012 and campaigns for hospitals to pool their purchases—saving 213-million euros on purchasing individ- ual medical devices and 149-million euros on biomedical equipment by 2017—French medtech companies' sales margins have been slashed. "This sector suffers from the absence of companies big enough to exert a rip- ple effect on the industry's stakeholders," acknowledges the French Ministry of the Economy, Finance and Industry. With the exception of three big companies—Essi- lor, a major player in ophthalmic optics, bioMérieux in the field of in vitro diagnos- tics, and Air Liquide, whose Air Liquide Healthcare subsidiary manufactures ven- tilators and anaesthetics – France has no international champions. More generally, there are only about sixty intermediate- sized firms (251-5,000 employees) among France's 1,100 medical device companies. Just 16 of these originated in France and dedicate over 50% of their business to medical devices. For the past two years, the public authorities have been stating their intention to effect change. France has identified the medical device sector as one of four priority strategic sectors for the future, and has made a commitment via the Contract for the Healthcare Tech- nology and Industry Sector. The French industrial plan for medical devices intends to reach 20% of intermediate-sized med- tech companies by 2020. This plan aims to produce French influencers in medical imaging, cardiovascular treatment, ortho- paedics, endoscopy and neuromodulation. For the time being, however, the following French companies have enjoyed a signifi- cant capital boost from public strategic investment funds: EOS Imagine, Super- sonic Imagine (medical imaging), Stentys (vascular stents) and Mauna Kea Tech- nologies (optic biopsies). This is a good start, at least. Unimed SA Lausanne, Switzerland phone +41 21 624 21 51 fax +41 21 624 53 32 www.unimed.ch e-mail: info@unimed.ch medical devices needles and probes Unimed SA Lausanne, Switzerland phone +41 21 624 21 51 fax +41 21 624 53 32 www.unimed.ch e-mail: info@unimed.ch medical devices needles and probes

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