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A N A L Y S I S  O F  T H E  B I O M E D I C A L  I N D U S T R Y
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A N A L Y S I S O F T H E B I O M E D I C A L I N D U S T R Y

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  • 1. ANALYSIS OF THE BIOMEDICAL INDUSTRY: THE MIRANDOLA DISTRICT CASE
  • 2. Definition of biomedical
    • three different business units:
    • pharmaceutical
    • biotechnologies
    • medical device technology industry (MDTI) (Mirandola)
  • 3. MDTI – Industry Structure
    • 9000 companies in EU
    • 6000 in USA
    • 400 in Canada
    • In all areas companies are for 80% small-medium sized
  • 4. MDTI – Products Areas
    • Complex technological products: the most profitable (x-rays, dental care, hortopedics, electromedical devices, etc)
    • Disposable: accessories, contact lens, canulas, DNA tests
  • 5. MDTI – Market
    • Value: about 190 bln$
    • 100 bln$ in USA
    • 66 bln$ in EU
    • 24 bln$ in JAPAN
  • 6. HEALTH AREAS
    • RENAL area:
      • Renal healthcare: (45 bln$) major deamand source, especially USA
      • Dialisys products: (8.3 bln$) sub-sector, involves directly Mirandola. 3 competitors (Gambro, SWE; Fresenius, GER; Baxter, USA)
  • 7. HEALTH AREAS – 2
    • CARDIOVASCULAR area:
      • About 14 bln$, high concentration in cardiovascular products market
    • TRANSFUSIONAL area:
      • 1.4 bln$, growth rate 5%
  • 8. MIRANDOLA: FIGURES
    • 35 direct-to-consumer companies and 35 intermediate product companies (6% revenues on final sales
    • 16% biomedical devices, 84% disposable
    • 2001:
      • 560 mln euros revenues
      • 3941 employees
  • 9. MIRANDOLA: COMPANIES
    • 5 multinational groups control 5 major companies, which earn alone about the 80% of total sector revenues. Multinationals compete in both renal, transfusional and cardiovascular areas, hence the demand of biomedical devices and disposables produced in Mirandola district. The groups are:
    • GAMBRO: (21000 employees, swedish, 40 countries) leader in renal products and healthcare. Owns all over the world about 700 clinics where about 55000 patients are given treatments. Total revenues: 3.2 bln$
    • GAMBRO DASCO, Medolla, 710 employees
  • 10. MIRANDOLA: COMPANIES - 2
    • B BRAUN: (29253 employees, german). 4 core divisions: anestetic products and services, rianimation and infusions (Hospital Care), surgical products (Aesculap), in-house patient care products (Outpatient Market), dialisys systems and products (MedTech). Tot rev: 2.7 bln$
    •  B BRAUN Carex, Mirandola, 111 employees
    • TYCO: (260000 employees). American multidivisional company, healthcare sector counts for 6.7 bln$ in revenues
    •  MALLINCKRODT DAR, Mirandola, 331 employees
  • 11. MIRANDOLA: COMPANIES - 3
    • FRESENIUS: (66000 employees, German), mostly in USA. Fresenius Medical Care, 43445 employees, treats about 120000 patients. Tot rev: 5.5 bln$
    •  FRESENIUS Hemocare Italia, Cavezzo, 143 employees
    • SORIN GROUP: (4841 employees, Italian) cardiac rhythm control, cardiac surgery and vascular care. Tot rev: 671 bln$
    •  BELLCO, Mirandola, 404 employees
    •  DIDECO, Mirandola, 654 employees
  • 12. DISTRICT STRUCTURE
    • 577 mln Euros revenues within the district
    • Percentage on total group revenues:
      • GAMBRO DASCO: 6.86%
      • DIDECO: 20.79%
      • BELLCO: 12.32%
      • MALLINCKRODT DAR: 0.58%
      • FRESENIUS HEMOCARE: 2.16%
      • B BRAUN CAREX: 0.96%
  • 13. DISTRICT STRUCTURE - 2
    • Among control groups, just Tyco diversifies its activities in sectors different from the biomedical one.
    • The most important productions are biomedical devices and disposables, filter machines for dialisys, apparats and cases in atossic plastic, selftransfusion systems, etc.
    • GAMBRO and FRESENIUS main income area is USA (about 50-60% of total), while SORIN, TYCO and B BRAUN sell more in Europe
    • Controlled Mirandola companies direct sales mostly to controllants, followed by sanitary systems (public/private) and commercial third parts
  • 14. DISTRICT STRUCTURE - 3
    • EBITDA:
      • GAMBRO DASCO: 9.41%
      • DIDECO: 18.93%
      • BELLCO: 14.00%
      • MALLINCKRODT DAR: 20.11%
      • FRESENIUS HEMOCARE ITALIA: 18.64%
      • B BRAUN CAREX: 1.91%
  • 15. STRATEGIES
    • Relatively few competitors on global market
    • Necessity of continous innovation, cost reduction and organizational flexibility
    • Central factor: right allocation and management of networks hubs
    • Challenge: increasing capitalistic mentality in far-east could lead to the creation of large-dimensioned asiatic competitors (especially China)
  • 16. STRATEGIES - 2
    • Defending strategies:
    • Protect technologic leadership not in a passive way (positional advantage) but active (overwhelming technologic improvement skills and better human resources
    • Exploit potential advantages resulting from chinese competitive opening
    •  Joint ventures in China aimed at producing disposable (low added-value products)
  • 17. GLOBAL SCENARIO FOR MIRANDOLA
    • Increasing demand in sanitary specialistic areas
    • Cost-efficiency and and technologic superiority
    • Exploitation of the network potentiality, especially for R&D centers
  • 18. MIRANDOLA: OVERVIEW
    • Mario Veronesi: founder and designer (Modena)
    • Pattern of development known as biomedical pyramid: small firms earn and develop thanks to research and innovations sold to larger organizations which exploit them
    • Mirandola  80% comes from disposable (differs from other districts because it is linked to more specific healthcare applications
    •  just a few portion involves complex technologic applications, which require huge investments and continous research, but grants better incomes
  • 19. MIRANDOLA: OVERVIEW - 2
    • Strategic relevance of European market, but USA stand as the most profitative and attractive market, even if it is difficult to reach and serve
    • Asia acquires importance over years, growing in quantity and quality
    • Good management and satisfying operative results within the district, but dynamically less attractive than former periods
  • 20. DANGERS AND THREATS
    • Lack of physical infrastructures (viability) and economical structures (public and private)
    • Collaboration and presence of laboratories and R&D structures is still too weak if compared to other districts
      • Joined to italian cronic lack of capital and resources, led firms to focus on disposable, the less technologic area (despite it is quite specialised)
      • This entails a future direct competition with China and Far East
  • 21. FUTURE AND HOPES
    • Even if never solved, logistic issues have never prevented Mirandola from being competitive
    • Focus on quality of technics, still required by multinational controlling groups
    • New market opportunities (Asia)