INDUSTRY OVERVIEW The Medical Technology Industry in

ISSUE 2020 MEDICAL TECHNOLOGY IN GERMANY Europe’s Biggest - care Market

“Germany is an extremely important market for Aerogen, and we look forward to continuing to strengthen our commitment here. With an in-country office, and an experienced team we are working closely with our customers and partners to meet their individual needs and grow together.”

John Power CEO and Founder | Aerogen

EUR 30 bn 2/3 sales generated by Germany’s medical of medical technology sales in export technology industry in 2018 markets in 2018

EUR 387 bn EUR 60 bn total annual health expenditure in 2018 – domestic out-of-pocket healthcare more than 11% of GDP market in 2018

~100% 88% of Germany’s 82 million residents are covered of are enrolled in a by health insurance plan

Global demand for innovative medical technology Domestically, more than 99 percent of the country’s 82 million solutions continues to grow as we live longer, healthier residents are covered by . German health lives. “Medical devices made in Germany” make a signi- insurers cover around two thirds of Germany’s total annual ficant contribution to enhancing patient and health spend of EUR 387 billion (or 11.4 percent of GDP). The quality of life around the world. Medical devices devel- out-of-pocket market is worth around EUR 60 billion. oped in Germany benefit from a world-class research and business environment, with the sector’s predominantly With its state-of-the-art infrastructure and its central small and medium-sized companies enjoying an inter- location in Europe, Germany is also an ideal location for national reputation as innovators and market leaders. serving surrounding European countries with an additional potential market volume of more than EUR 1,500 billion. Internationally, the “Made in Germany” seal continues to be held up as a guarantee of quality. This is especially the case in the medical device sector. In 2018, almost 70 percent of medical technology products made in Germany were exported to international markets.

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The Medical Technology Industry in Numbers

Medical Technology Made in Germany Innovative Cluster Networks The German medical technology industry, made Germany is home to more than 30 specialized clus- up almost entirely of small and medium-sized ter networks focusing on medical technology. Their enterprises, is highly innovative and generates a goal is to achieve continuous innovation in research significant share of its revenues from exports. and development as well as in manufacturing by In 2018, the approximately 1,300 medical device connecting companies, hospitals, universities, manufacturers (>20 employees) and their 140,000 and other research institutions. Dedicated cluster employees generated more than EUR 30 billion in management teams help obtain funding for joint sales – an increase of more than four percent over R&D projects, provide share facilities, and organize the previous year. Export markets are particularly educational training programs for their members. important to German companies – around two thirds of sales in 2018 were generated outside the Germany’s industry domestic market. Exports grew nearly six percent numbers speak for to a total of more than EUR 20 billion in 2018. German Medical Device Manufacturer themselves and for Germany is the world’s largest manufacturing Revenue Development a secure and suc- nation and enjoys 9.9 percent share of worldwide in EUR billion cessful investment medical technology production. This is in second in the country place behind the USA (38.9 percent) and before Revenue generated abroad Japan (8.9 percent) and China (8.1 percent) Revenue generated inland respectively.

Growing Export Demand Medical technology "Made in Germany" is highly 2025 191 valued around the world. Although the US remains 186 1 76 the largest single market and demand from China 164 continues to grow, the largest share of German exports actually stays within Europe. Approxi- mately 42 percent of German exports go to EU 108 1125 member states and another nine percent to other 90 100 106 European countries. Nineteen percent of exports are shipped to North America and Asia respectively. 2014 2015 2016 2017 2018*

*estimat Setting International Standards Source: German Medical Technology Association (BVMed) 2019 Close collaboration between science and industry has helped establish Germany’s medical technol- German Medical Technology Exports by ogy sector as an international beacon of quality, Destination 2017 performance and safety standards. A number of in percent institutions – including the German Joint Federal Committee (JFC) and notified bodies like TÜV and DEKRA – are responsible for ensuring the safety Europen Unon 42 and reliability of medical technology products and services produced in Germany. The industry North Amerc 19 is also subject to EU directives and regulations governing certification and marketability. Imple- As 19 menting essential industry norms including ISO 13485 (regulation of quality management systems) Europe (non-EU) 9 and ISO 14155 (clinical evaluation of medical technology) are common practice. All of this leads Other 11 to medical technology developed and made in Germany that meets the highest quality standards. Source: BVMed 2019

3 MARKET OPPORTUNITIES

Healthcare Expenditure International Patients Healthcare expenditure in Germany totaled EUR Some 10 percent of German hospitals have a spe- 387 billion in 2018; representing a more than three cifically international focus and existing services percent increase on the previous year’s spending dedicated to patients from abroad. Doctors with level. The amount is equivalent to 11.4 percent outstanding qualifications, highly specialized of GDP or approximately EUR 4,600 per capita. nursing staff, excellent diagnostics facilities, and a superb medical infrastructure together ensure Health Insurance that German hospitals offer the highest quality With around 88 percent of the German popula- medical care. tion enrolled in a public health insurance plan, the public health insurance system plays the Key Market Data 2018 dominant role in the allocation of healthcare ·· More than 99 percent of Germany’s 82 million funds. Eleven percent of the population opt for residents are covered by health insurance private health insurance, with less than 0.2 percent Healthcare spend- of the population having no insurance cover. ·· Total annual health expenditure: ing grew by three EUR 387 billion (11.4% of GDP) percent to EUR 387 Public health insurance providers covered EUR ·· Hospital expenditure: EUR 94.7 billion billion in 2018 221 billion or approximately 57 percent of total ·· Outpatient expenditure: EUR 95.5 billion healthcare expenses in 2018. Private health insurance companies reimbursed an additional ·· Number of hospitals: 1,942 (one third EUR 32 billion of medical expenses. The remain- private ownership) ing amount is covered by government budgets, ·· Number of hospital beds: 497,200 state-mandated long-term care insurers, the social pension fund, state-mandated accident insurance ·· Diagnosis Related Group (DRG) System providers, employers, and private households. (hospital sector): 1,292 DRGs, 205 additional remuneration titles

In- and Outpatient Care ·· Number of active medical doctors: 392,400 In 2017, outpatient care accounted for more than ·· Number of dentists: 64,925 50 percent of annual health expenditure. The most significant outpatient facilities include doctor's offices (EUR 55 billion) and pharmacies (EUR 49 billion). Inpatient and partial inpatient institutions account for EUR 13.4 billion of total expenditure, of Total Annual Health Expenditure 2018 which EUR 94.7 billion was incurred by hospitals. in EUR billion

Hospital Care In Germany, 1,942 hospitals – with total capacity of more than half a million beds – treated more 387 than 19 million patients in 2017. The average hos- pitalization period was 7.3 days. The country also had approximately 1,142 preventative care and rehabilitation facilities with nearly 165,000 beds 263 treating around two million patients. The average 207 rehabilitation stay was 25.4 days. In order to build up the necessary infrastructure, more than 1000 155 ambulatory healthcare centers (Medizinisches 107 Versorgunszentrum - MVZ) have been established on campus by hospitals in Germany. According to the German Hospital Federation, hospitals also provide specialized ambulatory care in some 20 Germn Frnce U Itl Spn million cases each year. Source: OECD 2019

4 Industry Overview 2020 | gtai.com Medical Technology Trends

Germany’s Hidden Champions Telemedicine German medical technology is cutting edge. A Telemedicine is making further inroads into the diversity of companies – nearly all of them small German healthcare system. This is a development and medium-sized – develops and commercial- that could result in annual savings of EUR 5.6 bil- izes innovative devices across the range of more lion according to McKinsey & Company. Seven of than 500,000 individual products within the Germany’s 16 federal states already permit remote medical technology spectrum. Many specialize medical treatment by digital means, giving rise to a in very specific fields of application and product growing number of telemedicine service providers. types. While these companies may focus on niche markets, they are often global leaders in their Cara Care respective fields. Germany’s medical technology The -based start-up offers a digital therapy R&D infrastructure is highly valued highly as a that alleviates the symptoms of digestive disorders resource that allows these innovative companies for 86 percent of the patients who use its service. to adapt quickly to global market trends. This consists of an app-based questionnaire and “food diary” as well as individual analyses and con- Demographic Change sultations with nutrition advisers via video chat. Germany’s over-65 population will increase to 24 million by 2035. As such, 65-year-olds will represent Teleclinic Germany’s over-65 a third of the domestic population – with people This Munich-based start-up allows people population will rise aged 50 years and older accounting for half of the with private health insurance to consult doc- to 24 million by total population. Long neglected as consumers of tors via smartphone app, video call, chat and 2035 private consumer goods and services, yesterday’s normal telephone call. The costs are already senior citizens have become today’s “golden agers.” covered by some insurance providers in the Companies who establish a foothold in Germany’s same way as a traditional visit to the doctor’s forerunner “silver economy” are well positioned to office. Additional health insurance providers launch into European and international markets. are expected to follow suit in the near future.

Industry Spotlight – Germany is Europe’s Dental Land

Many segments within the German medical technology Europe’s biggest dental market is expected to keep sector reflect changing trends relatively quickly. Ger- expanding thanks to growing dental health awareness many’s dental sector is a particularly relevant example among the population - with an increasing willingness for early innovation adoption. Around half of all medtech and ability to pay for preventative and corrective treat- manufacturers in Germany are active in the dental sector ments alike. The gap in unmet medical and cosmetic in addition to orthopedics, digital imaging, disposables treatment need continues to rise as the population ages etc. The “dental” sector occupies second place – behind and has access to an increasing range of dental technol- X-ray equipment – in the country’s medical technology ogy solutions. Price-sensitive patients and dental health manufacturing sector. More than 60 thousand different consumers also benefit from the new economies of products cover the complete spectrum of dentistry – scale that are being created – especially in the lower from diagnostics through preventive medicine to tooth price dental implant segment. Fully integrated CAD/ restoration. Germany spends more on dental health per CAM systems with 3D scanning technology, used both capita than any other country in the European Union, with intraorally and in dental labs, together with novel some EUR 27 billion of overall health spending of EUR 384 ablative and additive manufacturing systems have billion in 2018 occurring in Germany’s dental practices. accelerated the manufacturing process significantly.

5 MARKET OPPORTUNITIES European and German Medical Device Regulation

CE Marking A transition time of three years was put in place International companies serving the German effective from May 5, 2017, when the MDR text was market are required to meet German and European published in the Official Journal of the European health and safety legislation requirements. Specific Union. From May 2020 onward, new medical German regulations must also be complied with devices can be certified only under the new Euro- in addition to European medical device directives pean Medical Device Regulation (MDR - Regulation (MDD) which from May 2020 is replaced by the (EU) 2017/745). Given the maximum validity of a CE European medical device regulation (MDR). Medi- marking of four to five years, this leads to the dis- cal device manufacturers are required to declare appearance of MDD CE markings by approximately conformity to European Union legislation (Confor- 2025. Selected key revisions of the new MDR are: mité Européenne - “CE”) for all devices with an ·· New risk classification rules according to intended medical purpose. The CE mark can be Regulation (EU) 2017/745, Article 51, Annex VIII applied to the device once conformity has been declared. ·· Specific risk reclassifications (some class I into class II, IIb into class III)

Medical devices MDD Conformity Assessment ·· Implant conformity assessment procedure made in Germany Medical devices, unlike pharmaceuticals, are not for class IIb implants identical to class III receive the CE mark certified by governmental institutions but by noti- ·· Introduction of new risk class I “r” for reusable indicating confor- fied bodies working on their behalf. There are some surgical devices. Unlike rest of class I products, mity with European 60 such notified bodies throughout Europe, of self-certification is ruled out as notified body standards which 10 are headquartered in Germany (e.g. TÜV must be involved for conformity assessment SÜD and DEKRA). In the case of low-risk products, the manufacturer can declare conformity with ·· Some devices without an intended medical EU regulation without involving a notified body. purpose are treated as medical products. These are considered as being similar to medi- The risk classification criteria are provided in Annex cal devices in functioning and risk-profile. IX of the European Medical Device Directive 93/42/ Annex XVI of the Regulation contains the EEC which, together with the intended use, are the list of the group of devices concerned. basis for risk classification in the individual case. ·· Enforcement of unannounced (supplier) audits for higher risk products In addition to the fundamental legal frame- work provided by the EU, additional German ·· Unique Device Identification (UDI) database regulation is in place for the following: with 21 elements of information per device

·· Use and upkeep of medical products ·· Individual clinical trials necessary for class III

·· Prescription requirement and pharmacy ·· Clinical information to be published in public requirement for medical products EUDAMED database

·· In-house-manufacturing of medical products ·· Notified bodies to produce clinical trial report

·· Refurbishment of medical products ·· New EU expert committee (Medical Device Co- ordination Group) may issue scientific statement ·· Safety manager and medical products based on clinical trial report of notified body

New MDR Conformity Assessment ·· Notified bodies to incorporate scientific state- The European Commission initiated a revision of ment (may provide certification with restrictions) the existing regulatory framework for medical ·· Obligation for implementation of post-market devices in 2012. The goal was to align the rules surveillance systems with the technological progress achieved since the early 1990s when the existing directives were put in place. It was also intended to har- monize national interpretations and to increase transparency for all involved stakeholders.

6 Industry Overview 2020 | gtai.com

Reimbursement in Europe and Germany

Reimbursement in Europe and Germany German Market Access after CE Certification and Clarification The first steps to accessing the European market of Reimbursement Status usually include the declaration of conformity in compliance with the European Medical Device Regulation. However, having been approved First step to take at EU level for the European market, international manu- CE certification (MDD/MDR) facturers are then faced with national health- care and cost reimbursement systems. Second step to take at national level German Act on Medical Devices (MPG) and reimbursement legislation Social Code Book 1 SGB V In Germany, manufacturers are confronted with a system that is characterized primarily by statutory health insurance and, to a lesser In-patient sector degree, private health insurance. Both statu- Out-patient sector Reimbursability granted as Reimbursability is subject tory and private health insurance are financed long as basic principles of quality to approval through insurance premiums (paid jointly by of care and/or efficiency are the insured person, their employer, the national not violated 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 facturer. In 2016, the German health authorities across the 28 member countries in the union. introduced an additional scrutiny procedure within the Health Care Strengthening Act intro- Innovation friendly DRG System ducing § 137h Social Code Book (SGB) V. This The innovation friendliness of the respective reflects in part the stricter stance of the new national health systems largely influences their European MDR aimed specifically at medical uptake levels of new technologies or commer- devices of increased risk class IIb and III or active cialization of new products. Germany’s inpatient implants with an especially invasive character. system is especially innovation-friendly in terms of The G-BA (German Joint Federal Committee) is product safety requirements and the availability now required to perform benefit assessments of immediate reimbursement. The German DRG for devices using a novel scientific-theoretical system allows for any CE-certified medical device concept whenever an NUB procedure is initiated. to be reimbursed under existing procedures and their DRG codes (unless prohibited in the individual Outpatient Sector Reimbursement case). While German authorities are merely execut- There are two independent general agreements Germany’s reim- ing a prohibition right in the inpatient sector, reim- for the private health insurance and statutory bursement system bursement of a novel technology in the outpatient health insurance systems in the outpatient sector, supports product sector is subject to approval in each product’s case. based on which a nationwide billing system for innovation approved and paid services has been agreed. The Reimbursement for Inpatient Innovations Uniform Evaluative Standard ("EMB") is applicable Pre-existing DRG codes and the corresponding for the statutory health insurance sector. Accord- fixed lump-sum budgets based on established ing to § 135 Social Book Section 1 SGB V, the G-BA technologies are not always sufficient to cover is required to assess and confirm the diagnostic or innovative device spending. Where this is the therapeutic benefit of novel diagnosis and treat- case, the German system offers the NUB procedure ment methods as well as the medical need for (Neue Untersuchungs- und Behandlungsverfahren - use and the product’s economic viability before a Novel Diagnosis and Treatment Procedures). With new method may be adopted in the EBM. Alter- NUB status granted and individual OPS (Opera- natively, individual contracts can be concluded tions and Procedures Code) codes put in place, between insurers and manufacturers for products reimbursement can be increased significantly and not covered by the statutory . a sustainable business case secured by the manu-

7 MARKET OPPORTUNITIES Medical Technology Landscape in Germany

Industry Hotspots European Cluster Excellence Initiative Germany’s medical technology industry stretches The European Cluster Excellence Initiative (ECEI) across the entire country, with the town of was launched by the EU Commission in 2009 as Tuttlingen in the southwest perhaps being the part of the European Union’s efforts to foster most well-known of the country’s numerous growth and creation of world-class clusters across medtech hotspots. The sheer density of device the EU. The European Secretariat for Cluster manufacturers there is often explained in terms Analysis (ESCA) was subsequently established in of the local precision manufacturing heritage order to offer practical advice to Europe’s cluster and, more specifically, cuckoo clock produc- management organizations. Today, ESCA is a tion. Different medical technology segments network of cluster experts from more than 30 are dotted around the country, with medical countries that consults cluster policy makers and optics, for example, being well represented in promotes cluster management excellence through the eastern German city of Jena, with some benchmarking and quality labelling of clusters globally leading manufacturers still bearing and their management organizations. In Germany, the city name in their own company names. 10 cluster networks with activities in the medical technology sector have already been ECEI certified. Promoting Partnership The small and medium-sized company nature go-cluster Initiative of most German medtech manufacturers makes The Federal Ministry for Economic Affairs and cooperation with academic, scientific and other Energy “go-cluster” excellence program brings manufacturer partners a common element of together more than 100 innovation clusters Medical technology company strategies. Pooled resources allow advan- from across Germany. Cluster members are at clusters can be tageous synergy effects to be effectively realized the cutting edge of innovation and represent found right across and research and product development costs to be the technological diversity within the country’s the country cut through joint purchasing initiatives. The close industry and technology sectors. The initiative proximity of medical universities, research institu- provides financial stimulus – in the form of sup- tions and large manufacturers to each other often port for innovative services and funding for novel constitutes the nucleus of local medtech clusters solutions – to optimize cluster management that support the industrial value chain at the local allowing member clusters to position themselves level. Today those medtech cluster networks, as highly effective and visible international clus- funded by national and regional governments, ters. Membership provides numerous advantages are equipped with staff and budgets of their own to innovation clusters, actors and partners. and represent the most significant landmarks in Germany’s medtech industry landscape. → www.clusterplattform.de

Digital Hub Initiative The Digital Hub Initiative, developed by the German Medical Technology Company Size by Revenue 2017 Federal Min­istry for Economic Affairs and Energy, seeks to support the establishment of digital hubs in Germany. The underlying < 50 employees idea of establishing 12 digital hubs across the 50-99 employees country is that cooperation between compa- 100-249 employees nies and business start-ups within a confined 250-499 employees area will boost innovation in the digital age. >500 employees → www.de.digital

Source: SPECTARIS 2018

8 Industry Overview 2020 | gtai.com

Medical Technology in Germany: Manufacturing Clusters Kiel Schleswig- Rostock Holstein City or Area of Cluster Location Lübeck 10-20 Companies Mecklenburg 20-40 Companies Western-Pomerania 40+ Companies Hamburg

Bremen

Niedersachsen

Berlin

Hannover

Magdeburg Münster Brandenburg Bielefeld Halberstadt North Rhine- Westphalia Göttingen Saxony-Anhalt

Düsseldorf Leipzig Lüdenscheid Dresden Thuringia Saxony Jena Hessen Ilmenau Marburg Koblenz

Frankfurt

Rhineland- Palatinate

Erlangen Saarland Nuremberg Saarbrücken Mannheim Baden- Württemberg Karlsruhe Bavaria

Stuttgart

Ulm

Freiburg Munich Tuttlingen

Source: GTAI 2017 based on Marcus Datenbank, Bureau van Dijk

9 INVESTMENT CLIMATE Europe’s Talent Pool

Engineering Tradition Competitive Labor Costs Germany enjoys a long and successful tradition in High productivity rates and steady wage levels mechanical medical engineering and high quality make Germany an extremely attractive invest- manufacturing. Medical technology companies and ment location. The labor cost gap between their employees alike can rely on Germany’s unique Germany and its eastern European neighbors education system, which produces the largest pool has been significantly reduced. In fact, Germany of talents and skilled people in Europe. Most stu- has gained the labor-cost edge in recent years. dents enroll in the public university system, which is practically free of charge. Since 2005, wages in the manufacturing sector have risen in most European countries (EU-28), High Academic Uptake with the growth rate averaging 2.7 percent. While According to the German Federal Statistical Office, some countries – particularly in Eastern Europe – Germany has a particularly high academic uptake experienced a rise of more than five percent, Ger- rate. In the academic year 2018/2019, some 2.9 mil- many recorded one of the lowest labor cost growth lion students were enrolled at more than 426 insti- rates (2.3 percent) in the manufacturing sector tutions of higher education. Germany’s share of within the EU. This has been another decisive argu- university students in the sciences, mathematics, ment in favor of Germany as a premium business computer sciences, and engineering is significant location. Highly flexible working practices such with 200, 000 additional students in those fields of as fixed-term contracts, shift systems, and 24/7 study in 2018. In the region of 40 percent of these operating permits contribute to enhance Germany’s students are pursuing courses in fields relevant for international competitiveness as a suitable invest- the medical technology industry, with over 500 ment location for globally active businesses. individual university programs throughout the country related to medicine. There are more than 140 bachelor and masters programs for students to Employee Distribution in the Medical choose from in the medical technology field alone. Technology Industry in Europe 2017 in thousands Dual Education System: Medical Technicians Germany operates a dual vocational training sys-

tem - combining the benefits of classroom-based 200 and on-the-job training over a period of two to three years. A total of 323 different recognized trades can be learned with regard to medicine; with specific advanced training courses avail- able to enable metal or electronics specialists to achieve status as recognized medical technicians. In close cooperation with the German govern- 100 85 ment, the German Chambers of Industry and 76 Commerce (IHKs) and the of Skilled Crafts (ZDH) ensure that exacting

standards are rigidly adhered to, guaranteeing 24 the quality of training provided across Germany. Germn Frnce U Itl Spn

One in five German companies take part in the Source: Statista 2019 dual vocational training system, thereby turning apprentices into specialists who fit each company’s needs. Most apprentices receive an employment contract after training. More than 70 percent are taken on as employees in production-based industries underlining the importance of the train- ing system. More than 1.3 million young people are currently in vocational training in Germany.

10 Industry Overview 2020 | gtai.com

Financing & Incentives

In Germany, investment projects can receive finan- Labor Incentives and R&D Project Grants cial assistance through a number of different ins- Once the location-based investment has been truments. These instruments may come from private initiated, companies can receive further subsidies sources or consist of public incentives programs to help put together a workforce or for deploy- available to all companies – regardless of country of ment in R&D projects. Labor-related incentives provenance. They fit the needs of diverse economic play a significant role in reducing the operational activities at different stages of the investment costs incurred by new businesses. The range of process. programs offered can be classified into three main groups: programs focusing on recruitment support, Early Stage Investment Project Financing training support, and wage subsidies respectively. Please visit Technologically innovative start-ups in particular our website for have to rely solely on financing through equity R&D project funding is made available through more incentives such as venture capital (VC). In Germany, apropriate a number of different incentives programs information: VC partners can be found through the German Pri- targeted at reducing the operating costs of www.gtai.com/ vate Equity and Venture Capital Association (BVK). R&D projects. Programs operate at the regional, incentives national, and European level and are wholly Special conferences like the German Equity independent from investment incentives. At Forum provide another opportunity for young the national level, all R&D project funding has enterprises to come into direct contact with been concentrated in the High-Tech Strategy potential VC partners. Public institutions such as to push the development of cutting-edge development banks (publicly owned and orga- technologies. Substantial annual funding bud- nized banks that exist at the national and state gets are available for diverse R&D projects. level) and public VC companies may also offer partnership programs at this development stage. Incentives in Germany Later Stage Investment Project Financing Debt financing is a central financing resource and the classic supplement to equity financ- Funding purposes ing in Germany. It is available to established companies with a continuous cash flow. Loans can be borrowed for day-to-day business Working Research & Specific Investments Personnel (working capital loans), can help bridge tem- Capital Development Purposes porary financial gaps (bridge loans) or finance long-term investments (investment loans).

Financing supported by any of the Besides offers from commercial banks, investors following public funding instruments can access publicly subsidized loan programs in (combinations of instruments usually possible) Germany. These programs usually offer loans at attractive interest rates in combination with Public funding instruments repayment-free start-up years - particularly to small and medium-sized companies. These loans Equity Mezzanine Grants Loans Guarantees are provided by the state-owned KfW develop- Capital Capital ment bank and regional development banks.

Investment Cash Incentives When it comes to setting up production or service facilities, investors can count on a number of dif- ferent public funding programs. These programs complement the financing of an investment proj- ect. Most important are cash incentives provided in the form of non-repayable grants applicable to co-finance investment-related expenditures such as new buildings, equipment or machinery.

11 SUCCESS STORY Best Practice Example: Aerogen

Germany Trade & Invest (GTAI) provides a range Project Information of inward investment-related services to inter- Aerogen established German subsidiary national investors. After careful consultation company, Aerogen GmbH, in November 2017. with the individual investor, a support program Since establishing its German presence, the of consultancy and information services – includ- company has expanded its international sales ing market analysis, tax and legal information as activities from its DACH market base, increas- well as partner and site selection – is provided ing its sales division to 12 employees. to help set the stage for investment success. Aerogen GmbH currently supplies over 350 hos- Company Information pitals in Germany, with the number increasing to Founded in Galway, Ireland in 1997, Aerogen is one 800 hospitals when accounts supported alongside of the world’s leading medical device company premium OEM partners are included. The company specializing in the design, manufacture and com- has recorded year-on-year growth of 44 percent, mercialization of aerosol drug delivery systems. generating EUR 14 million turnover in Germany. The company has partnered its technology with the world’s leading mechanical ventilation com- Strategic partnerships with leading companies panies. More than eight million patients in over 75 in the mechanical ventilation sector play an countries benefit from more effective and efficient important role in market acceptance of Aero- medical treatment made possible by the com- gen’s nebulizer technology for application in pany’s innovative aerosol drug delivery technology. aerosol drug delivery. A strong engagement of the Aerogen team in Germany and close col- laboration with premium OEM partners has resulted in Aerogen achieving 30 percent growth “We plan to continue to grow Aerogen as the gold on the previous year's results on end-user sales standard across intensive care units in Germany. in partners' exclusive hospital accounts. Additionally, we will grow our business from ICUs Market Expansion to wards for spontaneous patients, where we will Aerogen is seeking to consolidate its position focus on special treatment of illnesses such as in Germany by establishing its products as the asthma and COPD.” gold standard across intensive care units (ICUs) in Germany, while growing its business from Alyas Mussa, National Sales Manager, ICUs to wards for spontaneous patients, with Aerogen GmbH particular focus placed on special treatment of illnesses including asthma and chronic obstruc- tive pulmonary disease. The company’s core international business will continue its upward Product Information progression with high-growth opportunities The company’s patented vibrating mesh technol- targeted in new markets in Europe and beyond. ogy turns liquid into a fine particle mist, gently and effectively delivering drugs to the lungs of critically ill patients of all ages. Aero- gen’s products significantly improve aerosol drug delivery; resulting in better patient care across hospital intensive care and high-dependency units, emergency departments and wards as well as neonatal and pediatric departments. Delivering more than six times as much medica- tion as traditional nebulizers, the aerosol drug delivery system effectively speeds up recovery times and reduces hospital admission rates.

12 Industry Overview 2020 | gtai.com OUR PARTNERS Industry Associations and Organizations

Germany Trade & Invest works closely together with the respective German industry associations to provide support to foreign medical technology com- panies seeking to settle in Germany. SPECTARIS Industry associations function as the local inter- SPECTARIS is the German industry association for est groups of business operators within a specific the high-tech, medium-sized business sector and industry. They realize more than just the general representative body in the areas of medical tech- functions of professional associations for their nology, optical technologies and analytical, biologi- members. They also promote and represents the cal, laboratory, and ophthalmic devices. Innovation combined interests of the industry and trade and growth characterize the different industry companies; carry out active lobbying work by sectors. Technologies developed here are used representing the interests of the company in their in almost all branches of industry, making them activities with municipal, state, and federal gov- an important motor for the German economy. ernment authorities; offer various working groups as platforms for dialogue and exchange; and orga- In the medical technologies sector, SPECTARIS nize events and continuing education and training. represents around 160 companies in the industrial Germany Trade and goods and appliances sector – predominantly Invest would like The associations also provide information about small to medium-sized enterprises are posi- to thank both as- the local economic framework conditions in tioned within the sectors of industrial goods and sociations for the Germany and specific regions in the world. All medical appliances. The medical technology trade support and infor- members are also able to draw on the compre- association provides its members with support mation provided hensive advice and services of the responsible and information in various business areas and for the making of association. They are generally the first point- topics including financing, hygiene and process- this publication of-contact in the event of day-to-day business ing, compliance, regulatory affairs, HTA, market problems. Within Germany there are two associa- access, research funding, and public affairs. tions dedicated to the medical technology sector. → www.spectaris.de

BVMed BVMed represents more than 220 industry and trade companies. Among the members of the ”Health - Made in Germany“ Export Initiative association are 20 of the largest medical device The “Health – Made in Germany” export initiative manufacturers worldwide in the consumer goods is the first address for international partners look- sector. Its scope comprises the entire sector of ing to discover how they can gain access to and medical dressings, technical aids such as ostomy benefit from Germany's longstanding commitment and incontinence products or bandages, plastic to innovation, quality and reliability in health care. disposable items such as syringes, catheters The Federal Ministry for Economics and Technology and cannulae as well as the implants sector of (BMWi) initiative bundles key information and pro- intraocular lenses, hip, knee, shoulder and spinal vides vital business contacts fo rnew and fruitful implants, heart valves and defibrillators and cooperation. even artificial hearts. Homecare services and biotechnology procedures, such as tissue engi- → www.health-made-in-germany.com neering, are further member fields of activity.

→ www.bvmed.de

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Editor William MacDougall, GTAI Gabriel Flemming is the senior manager respon- sible for healthcare in Germany Trade & Invest's Layout Chemicals & Healthcare team. He advises and Danielle Röbbenack, GTAI provides support to international pharma, biotech and medical devices and related companies seek- Print ing to set up operations in Germany. He previously Kern GmbH, 66450 Bexbach worked as a technology scout responsible for www.kerndruck.de managing Deutsche Bank's patent value funds. Picture Credits For questions on how to establish your business Cover: ©BVMed – Bilderpool in Germany, please contact Gabriel Flemming Page 15: Germany Trade & Invest/Frank May at [email protected] Notes For more information about the medical All rights reserved ©Germany Trade & Invest, technology sector in Germany, please visit September 2019 our website: www.gtai.com/medtech Reproduction, in whole or in part, only permissible Contact us at our headquarters in Berlin: with express prior authorization. All market data Germany Trade & Invest provided is based on the most current market Friedrichstraße 60 information available at the time of publication. 10117 Berlin Germany Trade & Invest accepts no liability for Germany the actuality, accuracy, or completeness of the T +49 (0)30 200 099-555 information provided. F +49 (0)30 200 099-999 Order Number 20854

15 About Us Germany Trade & Invest (GTAI) is the economic development agency of the Federal Republic of Germany. The company helps create and secure extra employment opportunities, strengthening Germany as a business location. With more than 50 offices in Germany and abroad and its network of partners throughout the world, GTAI supports ­ German companies setting up in foreign markets, promotes Germany as a ­business location and assists foreign companies setting up in ­Germany. All investment services and related publications are free of charge.

Germany Trade & Invest Germany Trade & Invest Headquarters Bonn Office Friedrichstraße 60 Villemombler Straße 76 10117 Berlin 53123 Bonn Germany Germany T +49 (0)30 200 099-0 T +49 (0)228 249 93-0 F +49 (0)30 200 099-111 F +49 (0)228 249 93-212 [email protected] [email protected] www.gtai.com www.gtai.de