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Medical Technology

Europe’s Biggest Market

Demand for innovative medical technology solutions continues to grow as we live longer, healthier lives. In 2017 spending on medical technology in Germany reached an estimated record high of EUR 36 billion. This creates growth opportunities for the medical technology industry, which in Germany is made up almost entirely of small and medium-sized companies. The positive outlook in the domestic market, combined with strong exports of “Medtech Made in Germany,” resulted in a 4.8 percent domestic industry revenue increase. The following information is designed to help international manufacturers understand how to expand in the German healthcare sector as well as outlining the range of support services provided by GTAI.

Germany’s Medical and Research Actors Respond to Corona Crisis

The German medtech market is the largest in Europe with record spending of around EUR 38 billion in 2019. With increased demand being created by the Covid-19 pandemic, this figure will be surpassed in 2020 and subsequent years.

Hospitals to double number of ICU beds

Although a number of industry sectors will experience significant to minimal foreign direct investment decline as a result of the ongoing crisis, the healthcare sector will record an increase according to forecasts. 

Germany’s two thousand hospitals currently have a 500,000 bed capacity. Intensive care unit capacity has been increased from 12,000 beds to 40,000 beds in recent weeks. German federal and state governments intend to further double the number of ICU beds in a joint effort and require hospitals to take immediate action in an effort to prepare for worst case pandemic scenarios.

Increased manufacturing capacity through diversification and partnering

Ventilators and personal protective equipment (PPE), specifically masks and gowns, are among those products most desperately needed in hospitals. Current demand exceeds available supply even though many global players including Drägerwerke, B. Braun and Siemens Healthineers are German in origin, and have significant on-site manufacturing capacity (as do international players including Johnson&Johnson, Hamilton et al). The European Commissioner for the Internal Market has called for quick action beyond the traditional medtech industry, urging manufacturers to increase and diversify production. Positive examples include textile and shoe manufacturers who have begun producing masks and gowns. 

In Germany, textile manufacturers and even automobile industry suppliers have proven to be capable of diversification by adapting their production lines to make new products like filtering face piece (FFP) masks. MAHLE, a specialist for combustion engine technology and car air conditioning, is working with underwear maker Triumph to this end, forecasting short-term output of 1.5 million FFP3 masks a month. 

Medtech clusters to set up special corona networks

Bringing together industry partners has been a key capability of Germany’s network of 30 medtech cluster networks across the country. In the face of the Covid-19 epidemic, this infrastructure has proven invaluable. MedicalMountains in Tuttlingen has set up the “Corona Drehscheibe” (Corona Hub), an online partnering platform specifically designed to coordinate regional demand and supply, purchasing agencies and manufacturing capacities. The national medtech industry association BVMed and SPECTARIS – covering optical, photonic, analytics and medtech industries – are also hosting Covid-19 specific information and partnering services.

New European Medical Device Regulation (MDR) to be postponed

EU and German legislators have taken immediate steps to guarantee uncomplicated procedures of conformity assessment with the European Medical Device Directive MDD and national Medical Device Law MPG. On March 30, EU Commissioner Stella Kyriakides announced the intention to postpone the more scrutinous European Medical Device Regulation MDR for one year until May 2021, the initiative yet to be confirmed and legalized by EU Commission and EU Parliament. Industry associations and manufacturers had previously voiced concerns at being able to comply with the new regulation, thereby putting supply and patient safety at potential risk. 

Exemption of conformity assessment for masks and ethanol disinfectants

As well as putting the more strict legal system of conformity assessment for medical devices MDR on hold, very specific steps have been taken to ease restrictions on related products including FFP2 and FFP3 masks which are not legally considered medical products. PPE with regulatory compliance in countries including Canada, China, USA, and Japan may now be marketed in Germany without undergoing the standard non-medical CE conformity assessment procedure. Germany’s testing institutes DGUV (IFA) and DEKRA have installed an alternate quick testing process to provide momentary exemption of CE-marking obligation where certified products are unavailable. Ethanol-based hand disinfectants have also been exempted from conformity assessment entirely, allowing pharmacies and manufacturers to immediately market such products after notifying the appropriate agency (BAuA).

Centralized PPE procurement

Protective mask and gown procurement of the German federal government has been put under centralized management by the Federal Ministry of Health. A general call for offers has been put in place online in an “open house” format with fixed pricing, date and means of delivery all being mandatory elements for offers (priority granted for products made in Germany). 

For further information on medical technology in Germany please contact our industry specialists.

Video: Smart Hospitals in Germany

With aging populations and increasing demand for medical services, AI and other digital innovations are going to become a crucial part of the healthcare of the future. 

Latest Publications

The Medical Technology Industry in Germany The Medical Technology Industry in Germany | © GTAI

Industry Overview: The Medical Technology Industry in Germany

Germany is the world's largest manufacturing nation with a share of 9,9 percent of worldwide medical technology production.



 


Medtech Radar: #2/2018: Digital und intelligent | Gabriel Flemming Medtech Radar: #2/2018: Digital und intelligent | Gabriel Flemming | © BIOCOM AG 2019 | December 2018

MedTech Radar

#2/2018: Digital und intelligent






 



Fact Sheet: Medical Technology Cluster in Germany Fact Sheet: Medical Technology Cluster in Germany | © GTAI

Fact Sheet: Medical Technology Clusters in Germany
The publication provides a countrywide overview of more than 30 specialized medical technology clusters. Germany's clusters provide benefits along the entire value chain.

Facts & Figures

THE GERMAN MEDICAL TECHNOLOGY INDUSTRY IN NUMBERS (2017)
Sales30.6 bn
4.8% increase in 2017
Lead market in Europe
Exports

64% (19.08 bn) of the production are exported, 2.5% increase in 2017. Target markets:

  • European Union 41.6%
  • Europe (non-EU) 9.3%
  • North America 19%
  • Asia 18.6%
R&D Expenditure9% of annual turnover in 2017
Employees≥ 200.000; 15% in R&D
CompaniesStructure: approx. 1.250 manufacturers, dominated by SME’s

Manufacturing and Innovation Clusters in Germany

Medical Technology in Germany: Manufacturing and Innovation Clusters
Medical Technology in Germany: Manufacturing and Innovation Clusters | © Markus Datenbank, Bureau van Dijk

Innovation Infrastructure

Innovative Strength

The German medical technology industry generates one third of its turnover from products less than three years old. The approximately 1,250 manufacturers (each with more than 20 employees) active in the medical technology sector invest around nine percent of their turnover in R&D. However, this is only one indicator for the high level of Germany’s innovative strength. In terms of all European patent applications in medical technology in 2017, Germany is on the first place within the European Union. From a global perspective, Germany was second only to the US in terms of number of medical technology patent applications in 2017.

Research and Product Development

The small and medium-sized company nature of most German medtech manufacturers makes cooperation with academic, scientific and other manufacturer partners a common element of company strategies. . R&D projects can count on numerous types of financial support in the form of grants, interest-reduced loans, and special partnership programs, some especially created for small and medium-sized enterprises (SMEs). Many collaborative projects are coordinated by medical technology cluster organizations with centralized management and project management staff: Germany is home to more than 30 innovation clusters in medical technology. Their goal is to achieve continuous innovation in research and development as well as in manufacturing by connecting companies, hospitals, universities, and other research institutions.

Market access: CE Marking and Reimbursement

Mandatory Conformity Marking

International companies serving the German market are required to meet German and European health and safety legislation requirements. Specific German regulations (MPG) must be complied with in addition to European medical device directives (MDD) and medical device regulation (MDR). Medical device manufacturers are required to declare conformity to European Union legislation (Conformité Européenne –“CE”) for all devices with an intended medical purpose. The CE mark can be applied to the device once conformity has been declared: Medical devices, unlike pharmaceuticals, are not certified by governmental institutions but by notified bodies working on their behalf. There are some 60 such notified bodies throughout Europe, of which 10 are headquartered in Germany.

Reimbursement Benefits

After having been approved for the European market, international manufacturers are then faced with national healthcare and cost reimbursement systems. In Germany, manufacturers are confronted with a system that is characterized primarily by statutory health insurance and, to a lesser degree, private health insurance. Both statutory and private health insurance are financed through insurance premiums (paid) jointly by the insured person, their employer, the national pension fund etc). While most EU countries have a DRG system in place for the inpatient sector, there are a number of different institutions, financing and reimbursement systems in place across the 28 member countries in the union.

Reimbursement Strategies

The innovation-friendliness of the national health systems largely influences their uptake levels of new technologies and commercialization of new products. Germany's inpatient system is especially innovation-friendly in terms of product safety requirements and the availability of immediate reimbursement. The German DRG system allows for any CE-certified medical device to be reimbursed under existing procedures and their DRG codes (unless prohibited in the individual case). While German authorities are merely executing a prohibition right in the inpatient sector, reimbursement of a novel technology in the outpatient sector is subject to approval in each product's case.

Business Information

Different covers of GTAI brochures Different covers of GTAI brochures | © GTAI

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